One of the hardest things that adult children must sometimes do is to assist their parents in downsizing.  Most of the time, this means also getting the parent(s) to agree to sell the home, perhaps also to move into a seniors facility (independent living, assisted living or skilled nursing) or perhaps to move in with one of the adult kids. Very often, leaving the house also means leaving a good deal of memories and perhaps independence.  It can be terribly difficult for everyone involved.

Sometimes our older family members can live at their own home until they die, which is what they want and what makes everyone happy. As they age, there are services which can come to them (cleaning, meals being prepared or dropped off, errands being run.driving services provided when reflexes slow or eyes fail). In those cases, perhaps worrying about real estate can wait.

For others, though, either medical needs or social needs drive the change to a place with many other seniors. For some, this infusion of new friends can be an emotional lifeline that greatly improves the quality of life.  Particularly for those who lose the ability to drive and move about independently, a transition to a seniors facility can mean a reconnecting with others which was lost due to lack of independence.  I have seen that with some of my own relatives.  (more…)

Recently I read an article on Realty Times about the tax credit for non-first time homebuyers. Did you know that it may be used for “move down” buyers as well as “move up” buyers?

There are some caveats – the home cannot cost more than $800,000 and a couple cannot earn more than $255,000 per year.  Owners must have been in the home for five consecutive years of the last eight.  This may be the ideal help for Silicon Valley seniors wanting to downsize.

To read the article on Realty Times, click here.

Yesterday some clients of mine asked me about seniors selling their home and purchasing another residence while keeping the older, lower property tax rate. I did a little digging and thought I’d share what I found.

There are actually two propositions involved.  Prop 60 applies to moves within Santa Clara County, and Prop 90 relates to moves between counties which are participating in this benefit to seniors (only these few, as of the date of this posting: Alameda, Los Angeles, Orange, San Diego, San Mateo, Santa Clara, Ventura).

Some of the basics:

• Homeowners 55 and older at the time of sale of the original property.
• Homeowner must be on record both for the home that’s sold and the replacement property.
• The replacement residence must be equal to or lesser in value than the original residence.
• There are special rules for multi-family (duplex, triplex, fourplex) properties and for mobile homes.

In the most typical scenario, a senior homeowner would sell a house (or townhome or condo) and “downsize” to another, less expensive, smaller house or condo.  If the homeowner had been in the first property for a very long time, then the low tax rate would be hard to give up, but Props 60 and 90 enable that homeowner to go to another, less expensive home and carry the old tax rate along – one time, and either in the home county or in one of the participating counties. 

I have known seniors to sell a house in Los Gatos, Saratoga or San Jose and move to The Villages or to gated senior communities out of the area but closer to their grown kids and make use of these two propositions.

For more information and to get all the details, please click on the links above.