Retirement Apartment - not sold Dad’s house yet

lisyloo

Bolt1234 said:

Quite Peter!  Where does the elderly person live whilst they are desperately trying to find somewhere (at 90!).  

One option is to buy somewhere, then it will be in a chain, so he can move from one to the other.

Another option is a bridging loan.
This will be expensive as you are asking a bank to take the risk and as neither the family not the builders will take the risk then of course this will cost (which again indicates the perceived risk).

lisyloo

Bolt1234 said:

This is 10 years worth!  

yes everyone agrees it's a lot, but you have no rights to insist they reprice their pricing or perception of the risk.
Either buy somewhere in a chain, or get a loan from the bank or look somewhere else with better terms.

Why not buy rather than rent?

GDB2222

Bolt1234 said:

This is 10 years worth!  

I’m surprised that they require that the money is in a bank account, where it will lose value. A well invested portfolio would provide better protection against inflation, which is surely what both the elderly person and the assisted living place require. 

It could  be worth asking them to get their decision reviewed by a more senior manager, given your circumstances?  

silvercar

You would have thought that retirement builders would have plans in place to assist in these sorts of situations. Would putting a charge on the property satisfy the builders? At least that would guarantee them their money once the sale happens.

GDB2222

lisyloo said:

Bolt1234 said:

This is 10 years worth!  

yes everyone agrees it's a lot, but you have no rights to insist they reprice their pricing or perception of the risk.
Either buy somewhere in a chain, or get a loan from the bank or look somewhere else with better terms.

Why not buy rather than rent?

There are a load of expenses involved in buying a place like this. SDLT is just the start. Some companies take a percentage of the sale proceeds. The OP would have the job of finding a buyer, which is not at all easy. There have been loads of threads about retirement properties sitting on the market for years, with service charges having to be paid. 

user1977

silvercar said:

You would have thought that retirement builders would have plans in place to assist in these sorts of situations. Would putting a charge on the property satisfy the builders? At least that would guarantee them their money once the sale happens.

If they're relaxed about not having any security over the money in a bank account, surely they'd be as happy knowing that he owns a house (easy to prove) and that he's actively trying to sell it (also easy to prove). What's the risk? He still hasn't sold it years in the future? He sells it and fritters away the proceeds (which he could just as easily do with the cash in the bank)?

lisyloo

GDB2222 said:

Bolt1234 said:

This is 10 years worth!  

I’m surprised that they require that the money is in a bank account, where it will lose value. A well invested portfolio would provide better protection against inflation, which is surely what both the elderly person and the assisted living place require. 

It could  be worth asking them to get their decision reviewed by a more senior manager, given your circumstances?  

investments for a 90 year old?
Anyway he doesn't have a large potfolio. He has £20k cash and £700K in an illiquid unexchanged property.

lisyloo

GDB2222 said:

lisyloo said:

Bolt1234 said:

This is 10 years worth!  

yes everyone agrees it's a lot, but you have no rights to insist they reprice their pricing or perception of the risk.
Either buy somewhere in a chain, or get a loan from the bank or look somewhere else with better terms.

Why not buy rather than rent?

There are a load of expenses involved in buying a place like this. SDLT is just the start. Some companies take a percentage of the sale proceeds. The OP would have the job of finding a buyer, which is not at all easy. There have been loads of threads about retirement properties sitting on the market for years, with service charges having to be paid. 

Good points, but it does depend on exactly what you buy.
A lot of 1 beds will be below the stamp duty limit.
Our parents had very low transactional costs (the estate agents and moving costs are there if you move into rented).

it's not at all easy selling a mccarthy and stone (and their ilk) property, but there are some that are better, but is the selling a priority for him in his position?
I've sold one and it went very quickly for asking price.
if it's one with more reasonable charges then there will be a demand in future.
He'll have released enough to see him through a few years in a nursing home and if it were me I'd want my Dad to do what was best for him not his beneficiaries.

lisyloo

user1977 said:

silvercar said:

You would have thought that retirement builders would have plans in place to assist in these sorts of situations. Would putting a charge on the property satisfy the builders? At least that would guarantee them their money once the sale happens.

If they're relaxed about not having any security over the money in a bank account, surely they'd be as happy knowing that he owns a house (easy to prove) and that he's actively trying to sell it (also easy to prove). What's the risk? He still hasn't sold it years in the future? He sells it and fritters away the proceeds (which he could just as easily do with the cash in the bank)?

Well clearly they aren't as happy knowing that or there wouldn't be an issue.
One risk is that there proves to be some sort of issue e.g. subsidence or that it just doesn't sell.
How do you prove that someone is actively selling it and not sabotaging deals?
The risk is they have a 90 year old they can't shift who isn't paying the bills.

But I agree with you about the security of a bank statement i.e. zero.

user1977

lisyloo said:

user1977 said:

silvercar said:

You would have thought that retirement builders would have plans in place to assist in these sorts of situations. Would putting a charge on the property satisfy the builders? At least that would guarantee them their money once the sale happens.

If they're relaxed about not having any security over the money in a bank account, surely they'd be as happy knowing that he owns a house (easy to prove) and that he's actively trying to sell it (also easy to prove). What's the risk? He still hasn't sold it years in the future? He sells it and fritters away the proceeds (which he could just as easily do with the cash in the bank)?

Well clearly they aren't as happy knowing that or there wouldn't be an issue.
One risk is that there proves to be some sort of issue e.g. subsidence or that it just doesn't sell.
How do you prove that someone is actively selling it and not sabotaging deals?
The risk is they have a 90 year old they can't shift who isn't paying the bills.

All properties can be sold, even something fit only for demolition is likely to have the bulk of its value in the land. We're into the realms of particularly obscure risks if the property isn't really worth anywhere near what it appears to be, or the owner prefers to be in major debt for his rent and risk eviction, rather than bother selling the house to cover the costs.