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Housing Options for Cash Poor Seniors
Many seniors find themselves thinking about housing options in retirement. As the Boomer generation continues to retire, many seniors are finding themselves house rich and cash poor. Some seniors are deferring their property taxes, but are still struggling to afford the monthly costs of staying in their homes. Even a seemingly small expense like a hydro bill could be the bill that forces them out of their homes or leaves other needs, such as food or medications, unmet. There are also many senior homeowners who are able to meet their monthly costs, but who live in fear of what would happen if they are faced with a major repair or replacement such as a roof or vehicle.
BC is considering The “Homeowner Expense Deferral Account” would allow low or moderate income seniors to not pay for utilities, home insurance and repairs until their death or the house is sold. That’s when the government could recoup its money, along with a basic low-interest charge. What BC also needs to do is help house-rich, cash-poor seniors live in their homes longer by offering a government-backed homeowners line of credit.The vast majority of seniors do not receive ongoing government-subsidized support for either their housing or daily care. B.C. already has a similar Property Tax Deferment Program currently used by over 35,000 homeowners over age 55, charging only 1 % interest. 50 per cent of B.C. seniors live on $24,000 per year or less and housing is the top concern everywhere. The practical effect of a deferral program could be an extra $6,000 to $11,000 in additional annual income to participants. B.C. now has the fastest growth rate for seniors in Canada, expected to account for one-quarter of residents at its peak in 2031.
The rules around the rapidly growing assisted-living sector — in which residents with relatively minor health problems live in their own apartments but are offered meals and housekeeping — need revising. That’s because residents are moved into nursing homes — also called residential or long-term care — if their health deteriorates temporarily. A recent advocacy report suggests accepting a broader range of health problems in assisted living, including palliative care for the dying. It further estimates that up to 15 per cent of people in residential care — with its higher nursing costs — could be living at home with extra help or in assisted living.
It is clear that we need to make some changes to ensure that seniors have affordable, comfortable housing and care so that they can stay at home if they so choose. Another option is to downsize – sell their current home and purchase something smaller. This can be stressful and or empowering depending on the situation. If you or someone you know is struggling with housing and debt or finances, you should setup a free consultation with a bankruptcy trustee before making any decisions.