Does Your House Control Your Future? An informative, hands-on guide to why you should move your life and memories here.
Step 1: A quick review. IS IT time to sell the house?
Owning your house today just doesn’t make as much sense for seniors as it does for the young folks. So let’s take a look at the real world of homeownership, get realistic about what you’re up against, and understand why it may be a good idea for you.
Getting serious about future maintenance:
YES NO MAYBE
Let’s add it up:
Will I need a new roof or roof repair? Roof Does my house need new paint?
Do my windows need to be repaired or replaced?
Will my furnace last another 5-10 years?
Will my air conditioner last another 5-10 years?
Will I spend $2,500 a year or more the next 5-10 years on lawn and landscape maintenance?
Maintenance As a long-time homeowner, you know some maintenance costs are reasonable and manageable under any circumstances. But others will send a shudder down
Let’s take a look:
• Average roof replacement – $20,000 using composite shingles, according to CostVsValue.com. • Painting a 3,500-square-foot house – $5,500, not including paint and other supplies, according to GaltTech.com. • Replacement windows for an average home – $11,000 depending on size, shape and quality, according to CostVsValue.com. • Replace your furnace and central air conditioner system – $10,000, according to CostHelper.com. • Lawn care – $25,000 over the next 10 years, according to The-Lawn-Advisor.com.
That’s more than $71,000 out of your pocket over the next 10 years, just to stay even. Plus, none of this adds value to your house, which means you won’t be able to recover your investment when you sell. The best it can do is make your house a bit more attractive than your neighbor’s, which may be priced about the same as yours.
your spine. All estimates at left found on national websites. Your personal experiences may vary.
Step 2: It’s time to sell. So let’s get started.
Real Estate Value.
If you plan on waiting for the value of your house to come back to what it was a few years ago, it’s likely to be a very long wait. In fact, the first quarter of 2011 saw home prices decline to levels last seen in 2002.
Houses are selling. People are buying.
So try this test.
Using the Compound Annual Growth Rate calculator you’ll find at www.investinganswers.com/calculators, enter what you think your house was worth 5 years ago, what you think it’s worth today, and how long you’d be willing to wait to regain the difference. Hit calculate, and it will tell you the compound annual growth rate you’ll have to achieve to reach your goal.
Our point is this: Owning your house was a good long-term investment
into short-term. The time to sell is now.
houses nationwide in March 2011 to 444,000 in April. That’s an increase of 10.4%. AND the Commerce Department reported annual rates of 629,000 housing starts and 624,000 housing permits for June 2011 – significantly better than the 570,000 housing starts and 609,000 permits many economists had expected.
Based on the Case-Shiller Index, if the answer is more than 2% per year, the Federal Housing Finance Agency and most economists would tell you you’re kidding yourself.
Add it all up. Or in this case, subtract: So assume your house will increase in value at a reasonable 1.5% per year for the next 10 years. Now, from that number, subtract what you estimated (on the previous page) you’ll spend on those maintenance, repair and replacement costs.
when you bought it. But now, long-term has turned
Sales of existing houses rose from 402,000
Does that actually seem worthwhile? And remember, 10 years from now you’ll be 10 years older, too.
You’re in the catbird seat. As a long-time homeowner, you’ve built up a tremendous amount of equity. You may
Selling and moving can be easy. But first, you have to get started. Have I researched the local real estate market? Have I talked to a realtor? Do I have a realistic estimate of my house’s value? Have I heard about programs to make selling and moving easier?
have even paid off the mortgage. So you’re in the
best position to negotiate, because you have the most flexibility in terms of pricing and closing. Everyone wants to get as much as they can for their house, but those with the most flexibility actually have the power to do so.
Plan on bringing all your memories with you.
“But I just can’t leave the memories behind.” We understand. Many of our residents felt exactly the same at first. The thought of leaving a place that was connected to so many happy memories just sort of stopped them in their tracks. But then they took a step back to really understand why they felt that way and what it all really meant to them. And they all realized their memories and their house were two entirely different things. They realized it wasn’t the mark on the wall where they proudly measured each new inch that each child
It wasn’t the house that was important. It was the people and the events that had become part of the fabric of our lives.
grew. It wasn’t the stairway their daughter descended in that beautiful prom dress, with the smile and confidence of the woman she would become. It wasn’t the house that was important. It was the people and the events that had become part
or perhaps you’re thinking you have everything you want right where you are now. Do you really? Are you sure about that? Let’s take a look. Is my home safe and easy to move around in? Are going to the grocery store and cooking still among my favorite things to do? Is doing the laundry easy and convenient? Do I see as many friends as I’d like, as often as I’d like? Is my family comfortable with my current living situation? Am I getting enough exercise?
of the fabric of their lives. They realized those wonderful memories didn’t live in their house.
Do I spend too much time alone?
Those memories were wrapped tightly in their hearts, and would travel with them no matter
Do I still use every room in my house?
where they chose to live.
Am I prepared to spend more than $71,000 over the next 5-10 years in maintenance costs alone?
YES NO MAYBE
Leaving your house could mean you’ll live longer, happier and healthier, too. It’s no surprise that the natural inclination for most people is to stay in their house as long as possible. Traditionally, declining health and the need for greater medical support was the only reason people would consider any other option. Today, however, an increasing number of healthy, active adults are choosing to leave their houses for a different type of support: social.
Active adults are choosing to leave their houses for a different type of support: social.
Feeling lonely isn’t exclusive to singles. It can affect couples, too. Perhaps one or both people aren’t as mobile. Or, trying to maintain a large house ties you down from pursuing other more enjoyable activities. Your close friends may have moved away or passed on, or your family doesn’t visit as much as you’d like. There are a number of reasons why one or both of you may want to expand your circle of friends. The benefits of social interaction aren’t just anecdotal. Research shows that social engagement can lead to better health and longevity, while social isolation can lead to poorer health and a shorter life. So moving into a place where you can easily connect with others has these key benefits:
Supports better overall health
The National Social Life, Health and Aging Project showed that people who feel the most socially connected are five times more likely to report very good or excellent health than those who felt the most socially disconnected and lonely.1
Improves memory and cognitive function
An active social life can improve brain power, increase our ability to concentrate and slow the rate of memory loss2 and other cognitive loss.3
Reduces heart disease, especially in women
Studies suggest that symptoms of depression and lack of social support (isolation) are associated with more heart attacks, open-heart surgeries and deaths from cardiovascular disease in women.4
Increases probability of living longer
A comprehensive study conducted by researchers at Brigham Young University suggested strong social relationships add, on average, 3.7 years to the lives of those who avoid becoming isolated.5 The U.S. Department of Health and Human Services published a report6 stating that people who move into a community setting live longer than those who remain in their houses during the later years of life, partly because their quality of life vastly improved.
1. Journal of Health and Social Behavior, 50(1):3148 (March 2009), Benjamin Cornwell, PhD, and Erin York Cornwell, PhD. 2. “Effects of Social Integration on Preserving Memory Function in a Nationally Representative U.S. Elderly Population,” Karen A. Ertel, M. Maria Glymour, Lisa F. Berkman, American Journal of Public Health, July 2008, Vol. 98, No. 7. 3. International Council on Active Aging Research Review, 7(41) 2007 and 8(12) 2008. 4. Psychosomatic Medicine 55:426-433 (1993), L.H. Powell and colleagues. 5. “Social Relationships and Mortality Risk: A MetaAnalytic Review,” Julianne Holt-Lunstad, Timothy B. Smith, J. Bradley Layton, PLoS Medicine, July 2010. 6. U.S. Department of Health and Human Services: Continuing Care Retirement Communities: A Background and Summary of Current Issues, Jacquelyn Sanders, page 8, 24, February 1997.
Step 3: It’s time to shake hands with the future. Chances are, your answers to the questions in this workbook have made it pretty clear that owning your house today isn’t the great idea it was 10 or 15 years ago.
The great news is that you still have tremendous profit potential in your house, which means when you sell, you’ll still be ahead of the game. But your life and your future should be about a lot more than money. Things like independence, opportunity, comfort, convenience and security, with a little freedom to pursue your passions. After all, life can be so rich when you just decide to make it so.
So why not decide to do just that?
Come on. let’s get started. 1-800-336-8511 www.presbyterianmanors.org
P.O. Box 20440 Wichita, Kansas 67208-1440 1-800-336-8511 www.presbyterianmanors.org
Our mission is to provide quality senior services guided by Christian values.