To think my parents are making a mistake?

[FizzyCherry]

My parents are both of retirement age, Mum is 69, Dad is 72.
Due to various reasons they didn’t get a mortgage until 20 years ago and both still work to pay it off, but they have at least 7 years left on it.

They have decided they want to retire, sell the house and buy a static home at a holiday park. They’re convinced it’s their ideal solution.

I totally understand their logic but I can’t help feeling they are being lured into a situation they will end up regretting.

If they sell the house, they can clear the mortgage and buy a static home outright with money left over.

However, they still have to pay the equivalent of 2/3 of their mortgage in ground rent and various other fees.
The park has swimming pool, gym etc, they are “free to use” - but that’s another £120 a month membership (!)
They must vacate their home for the whole of February every year so the site residents can avoid council tax.
Plus a friend of theirs lived somewhere similar that the owner decided to sell to developers. They were given £45,000 to “buy somewhere new”, after having lived there 10 years. They only owned the home, not the land, so that actually wasn’t a bad offer, but obviously nowhere near enough to start again.
So although they won’t have a mortgage, their outgoings will still be quite high, and they won’t have the same income, and they will need at least one car because this place is in the middle of nowhere. Plus at the end of the day, they will have nothing to show for it.

I have visited and it’s nice, but I think they are so attracted to the idea of living on a holiday park they are not seeing the full picture.

In addition, it’s in the countryside, where my mum has always insisted she could never live.

I asked if they would even consider this village if they were looking at houses, they said not for a second.

I fully support them in needing to make a move (and the house they’re in they only bought when I was 20, I only lived there 2 years so there’s no childhood sentiments involved).
Nor is this about inheritance before anyone says anything.
Although we’re not well off now, my husband stands to inherit quite well and my parents have never had much, plus have several kids, so it’s never been something we really think about,

But AIBU to be wary of this solution? Their current house is five minutes from mine and they are convinced that I’m trying to put them off because it’s convenient for babysitting etc but I genuinely am not remotely thinking about me or my needs, I’m an adult who can sort my own life.

I haven’t told them this but my husband and I have been trying to work out a way to help my parents pay the mortgage off but we’re just not in that position right now.
Nor can we offer them a spare room for February every year, we don’t have one. Nor do my siblings (one does but he lives abroad and my parents don’t like flying so he comes here for visits).

I suppose what I’m looking for is reassurance that I am BU, or at least more experiences of why I’m not.

I have suggested they look at retirement flats etc, my mum thinks they are for “old people”.

They like their house and would stay if they could afford it.

WWYD?

I understand that they don't want to think about getting old, but now really isn't the time for them to be sticking their heads in the sand about what is happening. Healthy life expectancy in the UK is around 63 years with most people expected to have 15 years of "not good" health at the end of their lives.

Hopefully your parents will be the exception and live into their 90s in great health, but if not they will struggle in the conditions of a static with the cold in winter massively exacerbating a number of health conditions. Further, if they have any issues that land them in hospital, it is probable that the inability to adapt the static will mean that they won't be able to go home from hospital.

I worked for a large UK wide holiday park for several years as an owners admin. A lot of people love ownership, but it is not cheap. Our site fees were up to £8k a year, averaging at about £5.5k. Owners also had to upgrade or remove the van from park when their caravan became 15 years old, even if they had only owned it for 2 years. Water, elec, insurance is all charged through the park so mark up is put on that, also any jobs you want done on the caravan that are arranged through the office will have a mark up put on them, of quite a drastic percentage. Not to mention seasonal jobs like drain downs etc. There are a lot of hidden costs that don't get mentioned in the sales speech, and the amount of times over the years we had people in tears handing their keys over because they couldn't afford it anymore was quite high. Also be wary that parks require legal evidence of a residential address to prove that you are not living on park, a photo card and legal document stating where they live which is required every year. It's not just to avoid paying council tax, if it's not a residential park you cannot use it as a main residence.

Show them this: www.thephraa.website/media-reports/

I haven't had time to read the thread. There was something on one of the news programmes about this recently - people being stiffed by the companies that own these sites. I don't remember the details but I think if a site sells then depending on the terms and conditions in your contract you might be forced to sell at a massive discount. I think you've got every right to be concerned for them. I would start researching it and showing them what could happen - look out for money watchdog type programmes or websites that give real life examples of who this has happened to.

If the site fees are 2/3rds their current mortgage and they will have to factor in a replacement home every 10 years and the extra heating bills. That is only if the site fees stay the same they are probably looking at more outgoings than they currently have. On the one hand their mortgage will come to an end on the other the fees will mean they will always have to work.

Depending what they are looking for if they moved to somewhere like Spain they could probably get a small house within a few kilometers of the beach for around £40,000. No site fees, no having to replace a mobile home every 10 years. They would have money in the bank and better weather all year round.

And if they want a swimming pool they would have the Med down the road or spend a bit more and they could have their own pool.

Friends who have taken the plunge don't regret it.

I don't think YABU. You should be concerned. And you are probably likely to be a lot more wise on current situations that could effect them.

I would show them some alternatives (smaller houses etc) or give them a breakdown of costs if they stayed in their current house to show it in a positive light.

Its the residents on holidays parks that dont pay council tax, I assume the park itself pays business rates which will be included in the sites monthly fees to residents/caravan owners.

Holiday parks are not suitable for long term living in my opinion.
What happens if they need to adapt access for instance?
I know someone who wanted to put a ramp onto their caravan, park rules said it had to be done through their contractors. No chance to get several estimates etc

A residential park may be a better alternative ( not all are retirement villages) . Still got monthly ground rent to pay but they're usually in cheapest council tax band.
Around here the units on residential parks are also increasing in value

But I really think your parents should seek financial advice. There may be a way to reduce the mortgage. I really do wonder if they've included ALL expenses, depreciation, gas, electric, winter storage, cost of renting in February, cost of purchasing another unit, rising fees...

They will have these expenses forever whereas the mortgage will be paid off in years.

It doesn’t sound like the best idea in the world but ultimately it’s up to them.
Maybe go over for a coffee and have a chat with them about your concerns - sound them out. For example, where are they planning to spend the month of February every year?
Why won’t they consider downsizing from the house they are in at the moment to maybe a 1 bed house or apartment? Least then they won’t have to vacate for a month! Have they been to stay on a holiday park in the depths of winter? Just so they get an idea of what it will be like when the weather is shit! Not quite as appealing as it is in the summer!!

All you can do is raise the questions, hopefully it will at least get them mulling things over a bit but yeah, if that’s what they want to do I don’t think there’s much else you can do.

OP I work for an MP. When people's lives go wrong, we are often their last port of call to get help.

We have a lot of people contacting us about park homes. It all depends on the owner. Get a bad one, and you can be screwed.

Avoid like the plague. There have been parliamentary debates about some of the problems that people have had.

it's not an investment it's a liability

Those static homes are horrible to live in. Always cold, damp and freezing in winter. I had to visit clients in homes like that when I was a carer and all they could talk about was what a mistake it was to ever move into a caravan!

It is a liability
Ask them if they can afford to upgrade too
Parks don't like old vans spoiling the look of the place

Has anyone mentioned how the one who is left, once one passes on, will manage costs on only one pension.

After a certain age/decline in mobility they would become very dependent on others. If they can't walk or bus to the shops/doctors how do they see it working?

Surely it isn't a case of avoiding council tax if it is one of the costs included in the park fees!

Still a terrible investment though. They depreciate like mad.

Show them this.

www.bbc.co.uk/news/uk-england-hampshire-41621685

There are also stories of Local Councils claiming several years of backdated council tax if caravan owners can't prove they have an alternative permanent address.

I've dealt personally with couples who have lost their life savings and ended up living in council temporary accommodation - this is not a good move.

OP, yanbu. It sounds like a dreadful idea and if they were my parents I would be doing all I could to talk them out of it.

Sounds like an awful plan. Can you and your siblings get together and all tell them what a tipis idea it is? Couldn't they just downsize (sounds like they have a house with at least two bedrooms) to free up some money?

Can't you do them a balance sheet? X amount in now, Y amount out. X amount in in caravan home, y amount out?

I'm a similar age to your parents OP. I very briefly thought about buying something like that, not a holiday place, but in a static home retirement village. Having looked into it I decided that it would be the biggest disaster I could get myself into.

Basically, on these sites the residence are at the mercy of the owners of the site. Get a bad one - and that's more common that you might suppose - and you can find yourself up a very nasty creek without a paddle and financially ripped off.

Yes, ultimately it's their decision, but you're clearly a caring daughter and you're right to be concerned.

I wouldn't touch one with a barge pole.

I think there are a lot of disadvantages to your parents plan and they stand to lose a lot of money on it as it sounds like they do not resell easily. A gym membership would be less than £120 a month. They are freezing cold in winter and if they have to move out that will be expensive to book into somewhere for that month. Unscrupulous park owners who charge enormous annual fees.

All you can do ultimately, and it sounds like you have already done this, is to point out the disadvantages. The alternative presumably is to downsize from their existing house to a flat or smaller house? Do either of them get a lump sum from their pension they can use to clear the mortgage? How long until they retire? Any chance of using savings or overpayments until they retire to clear the mortgage? I am amazed your Dad got a mortgage that long as most lenders, quite rightly, do not give mortgages past the age of 70.

Following as my mother has talked about buying one of these as a BTL. Think it is a poor idea

First off, I feel so sorry for your parents. What I dilemma to face late in life.
I've read most of the replies and agree with others that the static sounds bad. No need to repeat what others have posted.

I'm assuming there's little chance of your parents selling up and getting a council house/flat certainly not a private rented one.
Otherwise, have you considered you and your siblings remortgaging your own properties to bail out your parents? I'm sure legally it could be drawn up that any future inheritance must first be used to pay back all the siblings who helped, before whatever remains is split equally.

What happens when they become more frail? Is there space for a wheelchair? Commode? Steps to the door? Handrails? Room for carers to get around? Space to wash etc? All very good whilst you're mobile and independent, bloody nightmare as you become older and need more assistance and adaptions.

My Uncle did this waaay before he reached retirement age and he absolutely loves it. Just lives there with his dog, stays with my DGM in January when everyone has to vacate which she doesn’t mind at all. It’s ideal for him. I have visited it a couple of times and it’s absolutely lovely, not one bit like the images of a caravan I had in my head ; the area is nice too.

It is ultimately up to them but I wouldn’t say they’re making a huge mistake- provided they have somewhere to stay for a month a year. I suppose one concern I would have is if, God forbid, something were to happen to one of them would the other be terribly isolated in that area? That would probably be my biggest concern tbh.