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the way home

For more and more Canadians, it seems like a straightforward retirement strategy: Sell your home when you retire, move to a smaller one in a smaller community, and live off the proceeds worry-free.Fred Lum

The Way Home is a series looking at the challenges faced by different generations of people who are in the market for a home – from first-time buyers and growing families to baby boomers who are downsizing.

When Thelma Plecas and John McCaskie look back on the process of moving out of their Vancouver home and downsizing, they admit it was difficult to determine where to go.

The couple had lived for nearly three decades in that spacious place, a home that Mr. McCaskie, a former banker, built himself. Their four children and six grandchildren all spent time splashing in the backyard swimming pool. They adored their neighbours, sharing a cul de sac where everyone watched out for one another.

Having both retired in 2001, however, the avid travellers found that taking care of the 3,500-square-foot home was increasingly becoming a chore. Still, they weren't sure they wanted to leave the community they loved or whether a smaller house or a condominium would suit their lifestyle best.

They took their time figuring things out, ultimately moving to a condo in need of renovations in a concrete-and-brick building with water views in Victoria.

"Before we moved, it was kind of an agonizing process for both of us to make that decision to leave Vancouver," Mr. McCaskie says, noting that they have grandchildren in the city as well as on Vancouver Island. "But we both reached the age where we weren't interested in doing maintenance on the house or the pool much any more.

"For people in our age bracket, deciding to move can be a tough decision, and it's one we wrestled with," he adds. "There are certain advantages with a condo. We wanted to travel and it just makes it so much easier; rather than having somebody look after your house, you can turn the key, walk out the door, and forget about it until you get back."

The two are glad they've made the move, even after having to unload so many of their cherished possessions to fit into their smaller space.

With the aging population, the term downsizing comes up all the time. For more and more Canadians, it seems like a straightforward retirement strategy: Sell your home when you retire, move to a smaller one in a smaller community, and live off the proceeds worry-free.

However, as the Plecas-McCaskies can attest, it's not as simple a process as it may seem. Renting is an option for many seniors, while those who wish to own real estate grapple with what type of property to take on in their later years. Approximately 77 per cent of Canadians aged 55 to 64 own their homes, the highest rate of home ownership among all age groups, according to Canada Mortgage and Housing Corp. That decreases to 71 per cent among those aged 75 and up.

For many, leaving the place they lived in for decades doesn't seem nearly as appealing when they get to that stage.

"We had wonderful neighbours in a very friendly, very safe, beautiful area," says Ms. Plecas, who worked as an educator at various levels, including at the couple's own now-defunct college that helped people on income assistance find and maintain employment. "For me it's all about the people. One of the challenges here [in the condo] is that, if there is anyone in the elevator, they say hello but that's about it. … I was hoping for some camaraderie. I go to yoga two or three times a week so I'm starting to meet people that way. But missing my friends and my family in Vancouver has really been difficult for me."

About 85 per cent of Canadians older than 55 want to remain in their present home for as long as possible, even if there are changes in their health, according to CMHC.

Aside from considerations related to leaving your social network and having to give up so much square footage, there are the financial considerations of downsizing.

Sherry Cooper, chief economist with Dominion Lending Centres, says that condos are more expensive to build per square foot than single-family homes. And while it may seem logical to move to a remote or rural location to save money on another property, a lot of seniors find they have to return to a town or city if they experience health problems that make proximity to medical facilities necessary, or if they want or have to work.

"You get less for your money per square foot in a condo than in a home," says Ms. Cooper, also the author of The New Retirement: How it Will Change Our Future. "If you sell a single-family home and buy a condo of the same size in the same location, you're actually going to end up paying more for the condo than what you get for your house. And that's not taking into account maintenance or condo fees and all the other things that go along with the cost of moving.

"It's not necessarily true that you will need less space as you get older," she adds. "Supposing you have grandkids, you want them to be able to come and stay. People start working from home, so they may turn a bedroom into an office. People do move to smaller, less expensive locations, but as long as you're going to keep working it's hard to do that. Most people want to stay in their homes for a lot longer than they might imagine."

Brad Moldowan of Vancouver is a seniors real-estate specialist, a designation for realtors who are qualified to address the needs of home buyers and sellers aged 50 and up. He says leaving the family home doesn't necessarily mean moving to a condo.

"There are different ways to downsize, or rightsize, as I call it; it's not always down," Mr. Moldowan says. "Sometimes it's lateral. It may not be about having a smaller house or a less expensive house, but people may need a house that's equipped properly for their needs as they age; they may not be able to get up and down stairs.

"A lot of people have gone from a house to a condo not because it was financially motivated but because it was the right fit," he adds.

He has seen what can happen when seniors are adamant about staying in their homes, sometimes beyond a reasonable point. He recalls an acquaintance who was living in the same house for decades. It's worth far more than what she and her late husband paid for it, but she was subsisting on Domino's pizza because she knew one would last her three meals.

"A lot of people are asset-rich and cash poor," he says. "They don't realize they can rightsize to something that will make sense to correct their situation and improve their quality of life."

The CMHC's Housing for Older Canadians report notes that many seniors want and expect to age in place and do not seriously consider alternative options until circumstances force them to do so. At the same time, they may not make adequate preparation for remaining in their homes, such as installing accessibility aids, and tend to shun certain supports for aging in place, such as live-in caregivers or home sharing.

Mr. Moldowan says that if someone is pondering making the move to a condo, the sooner the better.

"Do you want to be making these decisions when you've got all your faculties or when you're starting to get sick? The time to do it is when you're completely aware," he says. "It's definitely hard. It's emotional. We have things in our home that mean stuff to us. … Personal stuff is a treasure and a memory. Your home is your shrine to your life, so it's very, very emotional [to leave]. If you've just lost a spouse or you're not well, it can be very stressful stuff."

Mr. Moldowan encourages seniors to have a whole team in place for the selling and buying of real estate aside from a realtor: an accountant, lawyer, investment adviser, and, in some cases, even someone to help you go through your personal belongings to start downsizing.

A condo's strata fees have to be calculated into monthly expenses; there is the potential for special assessments to hit people hard in the pocketbook, too, if a building is in need of major repairs. Mr. Moldowan urges downsizing seniors to scrutinize the strata council's minutes and other documentation during the research phase of a purchase to reduce the risk of an unexpected large payment.

Helping Ms. Plecas and Mr. McCaskie make their move was the agreement he negotiated with the buyers of their Vancouver home: After selling it, they leased it from the new owners for a year. The extra time meant they weren't in a panic to find a place that would suit their lifestyle and budget.

"Conceptually when a house changes hands, the possession date and the date that title transfers have to be the same day, but I say no to that," he says. "Let's give you time to gather up all your things in a nonstressful way and move on your own time."