Retirement villages

[Diemme]

Has anyone had any experience of elderly parents moving into retirement accommodation, particularly mcarthy and stone or elysian. My parents are looking into it and I've been really happy for them. But now I'm feeling uneasy about it. There's a LOT of small print which is hard to feel completely clear on. Has anyone got any experience, good or bad.

@titchy

Except if there is no cash in the estate to pay the service charges, there will be late payment fees in top of the service charge itself. The eventual sale may not even cover these.

Although you wouldn't be liable of course, but your parents may not like the thought of leaving a bankrupt estate.

It sounds like the whole thing is a rip-off and if this became more widely know the concept of retirement villages would be dead in the water?

Can you look at resales where your parents are considering buying?
Have they sold, at what price compared to new? Use Rightmove sold prices for this info.
If your parentsdidn't buy new they would get better value for money too.

The place they're looking at is brand new so no resales. I really need to get this clarified. If it looks like I'll inherit a debt that I couldn't afford to pay then I have to advise them against going ahead and destroying their dream. Really difficult situation.

Technically you can't 'inherit a debt'
That's right isn't it?

Is it also worth looking at the length of the lease?

Is there not a further problem if a parent needs to sell to fund a transfer to a care home but the flat doesn’t sell and fees eat into the remaining value in the property?

How old are they? How long would they reasonably expect to live there?
I think it would be a much better plan if they are early 70s, less so if they are late 80s.

You can’t inherit a debt. But you might not inherit anything if the debt eats up all the estate.

Can they find another M&S development and buy an apartment second hand? They're incredibly overpriced brand new but much more reasonable after the first owner has moved on. My GGran lived in a similar set up and she was at 'home' right until the end of her life with social events and warden support

A potential financial big hit for the family when it comes to selling on as they can be difficult to sell.
But for the elderly relative as far as quality of life goes they offer companionship, new friends, a social life, hairdresser's, concierge, someone to help in an emergency etc

My family all agreed that the benefits for our elderly relative far outweighed any inheritance. Better to have them safe and happy than lonely and living alone. At the end of the day it's their money and they worked hard for it - why shouldn't they be comfortable in their old age.

My mother lives in one of these. She loves it, but I'm expecting a nightmare when she passes on. Hopefully the service charges (about £500 per month) will come out of the estate. However, once we get probate, surely the flat will go into my name and then I will be liable until it sells. Many flats in this retirement village seem to take 18 months or longer to sell. I'm concerned that they will become harder to sell in the future, as more people wake up to the fact they are a rip off. My mother has made it clear that she doesn't really care what sort of a mess she leaves for my sibling and me.

In related news, I believe that you can disclaim an inheritance within 2 years of the person's death.

I'm also not convinced that my mother will be able to afford the service charge long term. She has a history of poor investment choices and living beyond her means.

Thanks for sharing that article @ZadieZadie. I've already read this and it does scare me.

My DM lives in one. Her monthly service charge is nowhere near £500.

I wouldn’t buy a new one.

Until COVID she had a great social life. Walking distance from supermarket. She is very happy there

Don't touch McCarthy and Stone. A family friend had to move out because she needed full time care, and in theory should have sufficient funds to pay for a private care home for the rest of her years. But her flat won't sell (it's on for less than half what she paid for it), and she's still having to pay the service charge. In the meantime she's had to move to a council funded care home, which is adequate but far from what she was hoping for.

The resale issue is not just an issue when the owner dies.

@Hayeahnobut yes, this also really concerns me. My mother sees herself in a private care home if she needs full time care in the future, but I'm not at all sure she could afford this if her flat doesn't sell.

I don't like M & S
I work in lots of these complexes are some are excellent. I don't know if Housing 21 are national but they are much better, a mix of rented and partiality owned. I've been in others that are fine too

Some of the modern Anchor ones are nice too.

If you are in any flat/apartment complex where you pay a service charge, surely that is payable until you or your estate sell the flat, that is not peculiar to M&S or just retirement flats.

You can't inherit a debt.

My gran lived in a retirement village managed by The Retail Trust, so almost like a charity I think. She rented rather than bought. No idea about charges, etc. She loved it. Very nice grounds. Safe. Lots of company when she wanted but the privacy of her own bungalow. Independence but wardens a phone call away who would come if needed. Evening entertainment in the main house.

You can't inherit a debt, but you can inherit a flat that doesn't sell, and then be liable for the service charge, council tax etc

There are lots of different schemes out there so you have to research what you are getting into.

I know of a scheme where the service charge is made of communal expenses that are just recharged at cost. The expenses are estimated in advance; contracts drawn up with gardeners etc; and service charge bills sent out. If one of the tenants died and the beneficiaries tried to wriggle out of paying the SC, how do you think the scheme-wide shortfall would be made good? by the magic money tree?
The budget is drawn up on the basis that everyone pays up, it couldn't work otherwise.

The apartments are tiny. None of my mum's belongings would have fitted.

My mother lives in one she bought a few years back. Not Macarthy and Stone we had heard too many stories about them upping costs constantly.
She's in one that used to be managed by BUPA. The cost have risen very slightly, but not much over the last 6 years.
Hers is part of Goldsborough

My DP are in a village run by extra care. It's been great during covid and they have made some great friends. There is a service charge which is quite high and you have to sell the property back at the end to them. However , I'm not bothered about this it's their money and they are are having a great life at the village.

The ones with a good community feel, interesting activities, proper management and some shared facilities seem to be great. The bigger they are the better chance of finding other like minded folk living there. M&S are, in my opinion, shockingly overpriced for what they are when bought new but I would imagine a probate second hand one could be a great choice.