Through the course of the coming decade, the majority of the baby boomer generation will be retiring from their careers, if they have not done so already. CBC reports that the median age in Canada, 40.6, is the oldest in history. Of course, this means that a large percentage of Canada as a whole should be looking ahead to plan what to do with their properties.This property decision is made even more critical due to the percentage of wealth that the average Canadian has in real estate. A recent Ipsos poll of 18,000 people found that for all Canadians the percentage of total household assets tied up in real estate is 77%. Clearly, a number of Canadians are counting on their homes and other property to finance their retirements. They will need to access their equity for liquidity.&nbsp;There are several options people can consider when entering retirement. These options range from selling their home outright and moving into a smaller space, moving abroad and opening up their family home to renters, selling or renting to finance a stay in a retirement homes, gifting or selling the home to your children, and the list goes on.We would like people to begin thinking about their options as it is never too early to start a plan for something so significant. However, before you action any of the ideas that we will speak about we strongly urge you to seek professional tax and legal advice that is tailored to your specific situation. A great idea can turn into a nightmare if you have not structured it to account for all of the consequences. Spending your sunset years in the CRA office is no one’s idea of a relaxing retirement.When people retire and the nest empties, senior couples likely find the need for maintaining a large property, initially meant for their family and children, an expensive and unnecessary burden. Moving into a smaller, yet still comfortable, home may be something to consider. National Bank notes the growing trend of people moving from their family home into a condo. There are several pros and cons to weigh when deciding if moving into a smaller space; it has to be right for you. As we know, smaller does not necessarily equal less luxury, as many condos can be beautiful and high quality. With the same luxury experienced in a house, condos also offer less maintenance. As people age, physical maintenance of a property can become impossible and eventually very expensive when they are unable to do things themselves. National Bank also points out that condo fees include various maintenance services in common areas. Downsizing into a condo may also accommodate physical disabilities that older people may face. Elevators rather than stairs, for example. Considering what you need and what is important to you will allow you to manage more affordable condo fees as well. By looking for a property that has what you value, security for example, and passing on things that you don’t, a tennis court or pool, you’ll maximize your efficiency.A very interesting compromise for those that don’t need all of the space that they did when the family was growing is to renovate your home to accommodate your changing situation and create cash flow. If it is manageable for you, this can be a great solution and an alternative to selling your home. Your home is made more comfortable, you retain full exposure to the capital appreciation of the real estate market, and you can generate cash flow to finance your daily needs. Renovations can be split into two categories. The first is where you add things to make your life more comfortable. Walk-in baths, a main floor bedroom, ramps, whatever is required to suit your specific situation. The second is where you modify your home to accommodate renters. This includes creating a separate entrance, an additional kitchen, separating rooms if your target clients are university students, wherever is required to maximize the potential of your space without turning your life upside down.&nbsp;National Bank also mentions the decision of moving from the city or the suburbs into rural areas or small towns. This can either involve moving your main place of residence or a second home, which we will talk about later. When moving your primary residence into a smaller community, there are several things to consider. First, are you comfortable possibly being farther away from everything you know? Will there be adequate healthcare, shopping, or other resources accessible? How long is the drive to the closest emergency room? National Bank points out the lower cost of living farther from the city. Lifestyle is an important factor; are you really suited for a rural life? In addition, city services such as snowplows might not be available in the area. If you elderly, perhaps taking care of your own roads is less than ideal. This said, it could also mean “going home”. Returning to where you grew up can be the most comfortable decision ever.&nbsp;Another popular idea for the elderly is moving into an intergenerational home. For elderly people, this may entail moving into one of your children’s homes. In many cases, these are single-family homes, but can include condos or duplexes for additional privacy. If you decide to buy a home with your children, both generations can be responsible for mortgages and other expenses. This is a practical idea given the housing affordability challenges that many young people face and a way of essentially providing a down-payment for a child.Older people may also decide to own a property abroad. Whether it be Florida, Hawaii, France, Spain, or wherever calls your name, there are things to consider. Whether you stay in Canada full-time or not can determine how you pay taxes, pensions, the ability to seek healthcare, and more. It is important to remember that owning two properties means you are responsible for double the housing maintenance. Perhaps renting your properties between uses or using it as an Airbnb may allow extra cash to flow in. Selling your home may also enable you to fully live out your retirement dreams across the ocean.<figure class="table"><table style="border-color:hsl(0, 0%, 100%);border-style:solid;"><tbody><tr><td style="border-color:hsl(0, 0%, 100%);border-style:solid;height:100px;width:50%;"><figure class="image image-style-align-center image_resized" style="width:100%;"><img src="https://files.rifo.co/CompanySite/38/38_图片 2.jpg"></figure></td><td style="border-color:hsl(0, 0%, 100%);border-style:solid;height:150px;width:100%;">&nbsp;While structured financial products such as reverse mortgages are also an option, the goal of this blog was to provide solutions that kept you in complete control and ownership of your property and wealth. We hope that you gain access your home’s equity and enjoy a long, happy and healthy retirement. Start thinking early and see a tax and legal professional.</td></tr></tbody></table></figure>

Retirement Plan for Elderly Home Owners - Real Estate Planning

RIFO lays out real estate options for the elderly home owners in Canada and abroad with reverse mortgage, re-financing, house downsizing or renting out

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