Expanding Our Retirement Living Options

August 23, 2009 by  
Filed under Retirement Planning

Mrs. ToughMoneyLove and I returned this evening from a weekend visit to a new community being developed on the Cumberland Plateau in Tennessee. Although not explicitly marketed as a retirement community, clearly the target buyers are retirees and retirement-hopeful baby boomers. We discovered while on a trail ride that some folks we know are building a house and plan on retiring there this winter. 

This community hit our personal sweet spots – spectacular equestrian facilities, lakes for swimming, fishing and low-impact boating, a natural setting, and endless outdoor amenities all rolled into a unified 5,000 acre low density development. It reminded us of a North Carolina community where my father lived for a number of years, except with horses replacing golf as a point of emphasis. All of the grandchildren loved to visit there.

So we placed a deposit on a condo in a low rise building that hasn’t come out of the ground yet. When construction is finished next spring, we will spend time there enjoying the environment and exploring the condominium lifestyle for possible future retirement. For much of the time over the next few years the developer will use the condo to house overnight visitors who are looking at purchasing property, guaranteeing us a steady rental income. A good deal all the way around. I plan on writing more about this community and our visit there on my Go To Retirement blog, so take a peak over there this week if that is a topic of interest to you.

If you have any experience with condominium living or insulated concrete form construction (which these condos will use), I would appreciate your feedback in the comments section.

For some other reading, check out these personal finance carnivals where my writing appeared this week:  Carnival of Personal Finance and Carnival of Money Stories.

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6 Responses to “Expanding Our Retirement Living Options”
  1. My Journey says:

    I live in a townhouse now (legally organized as a Condo) and it has turned me away from any form of Home Owners Ass’n for the rest of my life. The petty BS that comes with it is way too much for me. I don’t exactly see Mr. TML taking BS from a 87 year old because you hung your towel over a railing (yes that was a problem in my neighborhood) OR some random woman complaining anonymously on an internet message board that you drove too fast out of the community.

    Good luck!

  2. PW says:

    Having taken care of several groups of senior family members that live or lived in condos, here are the problems: the mangement fees become huge (they pay themselves first),and not much recourse. The maintenance/repairs on the buildings can be astronomical. If pets are allowed they can do some serious damage to the common areas of the building, and grounds & all owners pay for cleaning. They can change rules, increase fees. Some are now defaulting on common area utlitilies, insurance premiums, etc. These condos I reference are located in expensive good Chicago areas,1 townhouse unit got 2 dogs (allowed) and they bark constantly, and the assoc. can do nothing about it. Other unit owners are trying to sell. Some of the condo owners are just absurd in their complaints and demands. I have rented condos when on lake vacations and have seen where pets are allowed, they have damaged the interiors, left muddy footprints on the common areas, and pooped outside and no one cleaned it up. I guess it depends on your ability to accept things like that. Condo living does have it’s advantages, such as someone else taking care of the property-you pay for that–someone rents it out, etc. I like the vacation rentals but am not certain I would want to live in one. They seem to have escalating management fees and repairs after about 10-12 yrs. There never seems to be enough $ in the management account. One of our seniors condo assoc. gave each condo owner a bill for $15,000 for balcony repairs-last yr. This year they are getting a bill for $25,000 for window replacement/repairs. These are well built units,about 12 yrs old. That is a lot of $ to come up with after paying assoc. fees. But I do like to rent them out when on vacations at lakes. In this market you can get a good deal for renting because there are so many that don’t sell, you can name your price. Is the aggrevation worth the tax write offs-which is why my husband and i considered buying one. We decided probably not worth the aggrevation. Read the fine print–I know you will!!

  3. kitty says:

    I’ve lived in condos all my life – I am single and pretty helpless in terms of repairs so I’ve always thought I cannot handle a house. I just get all panicky when something breaks… Plus, all the stuff like grass-cutting, snow-removal, etc.

    In general, my experience has been positive. Now I live in a townhouse-style condo, before I lived in one bedrooms. These aren’t retirement condos, just normal condos.

    1) Insurance is much cheaper: all condo associations have policies that cover buildings, you only need to buy insurance to cover your belongings or, if you wish, some additional improvements that you put in.

    2) You don’t own the outside structure, so you aren’t responsible for roof, walls, grounds. No need to cut grass either. In townhouse-style condos you usually have your own heat/central AC (if it has it) so it’s your responsibility. In one level condos, it’s often common – but do make sure your unit has a thermostat, you don’t want others to control the temperature in your place.

    3) Snow is taken care of.

    4) Closing costs are considerably less than for a house. For example, you don’t need to have a surway.

    5) termites, etc. will be taken care of by the management.

    1) There are rules. What you can and cannot put on your porch may be regulated; some improvements require approval; you may not be able to get a satellite dish, etc. If you decide to replace the windows, your window will have to look the same as others.
    2) You may pay for stuff you don’t need e.g. you may not use pool, but it is still part of your common charges.
    3) The only control you have over necessary (or not so necessary) expenses is your voting power. But you can be outvoted. For example, our condo complex decided to change the siding. I don’t think the old one was that bad – if it had been my house I’d probably waited. The place was built in 1974, so I think siding should last longer than that. Not only that, but it turned out to be more expensive than they planned, they decided to do it within 2 years instead of 7, so they took a loan. No lien on property, thankfully, just power to assess. But… for 7 years, we have an assessment of $140 a month in addition to common charges. I voted against this, by the way, but was outvoted. At the same time, I am usually quite busy, so I don’t have time to go to the meetings, just sign the paper and send it in. If you have time or desire you can go to all meetings then you have more ability to influence the decisions; you can even get yourself elected to the board. Being a lawyer would give you an advantage in dealing with boards anyway.

    4) if heat is shared than people are likely to to care even if costs are part of common charges. People are much less careful with “common” money than their own. From personal experience — now that I have my own heating/cooling bill, I pay a whole lot more attention to how much heat/air I use.
    5) Foreclosures affect condos more than houses. If there are too many foreclosures, your common charges may go up to compensate if people aren’t paying; there may be an assessment. Banks owning a number of units may not care about the property and vote down necessary repairs.

    Some things to watch for:
    1) Read condominium by-laws before you buy, make sure you can live with them
    2) Sound proofing. See how the place is built. Carpets on upper floors really help, especially if you have one level. Also, my previous condo had a layer of sancrit between the floors. It was much better than many places that didn’t have it.
    3) If your place hadn’t been new, I’d suggest to check history of common charges. In my previous place, I’ve lived for 7 years, and they have only raised common charges once and by less than 5%. At the same time, they needed an assessment when they had to replace roofs, so reading their annual reports is important too. Since your place is new, you’d have no history to go by. You’d probably not need any repairs for a while either.

    BTW – I didn’t find pets to be a problem. I have a cat. Our condo has rules that all cats have to be indoor-only and that dogs should be walked in a specific areas and that the owners have to clean after them. It seems to work fine. In terms of barking – in townhouse style condos the sound isolation between units is pretty good, so I don’t really hear dogs even though my neighbors on both sides have them. With my previous neighbors, I heard the dog barking from the street, but once I was in my unit, I couldn’t hear it any more. You do need to check how the condos are built – in some place where I lived, especially in one level condos, it was a problem; in others – it wasn’t.

    This is about it… I might think of more stuff later.

  4. Bucksome says:

    Mr. Boomer and I downsized from a 4 bedroom ranch-style home to a 3 bedroom townhouse style condo two years ago. Part of this change involved moving 20 miles closer to work and saving me 90 minutes a day in commuting.

    We love condo living and don’t regret the decision. We do live in a small association (51 units) and haven’t had any problems with our neighbors, HOA or the management company.

    I think trying it out like you are is the way to do it.

  5. MasterPo says:

    My father always advised me to avoid condo living. All the reasons Kitty gives above.

  6. Rick Beagle says:

    “It was Grassley himself who devised the “Throw Mama From the Train” provision of the GOP’s 2001 tax cut. The estate-tax revision he championed will reduce the estate tax to zero next year. But when it expires at year’s end, the tax will jump back up to its previous level of 55 percent. Grassley’s exploding tax break has an entirely foreseeable, if unintended, consequence: it incentivizes ailing, elderly rich people to end their lives—paging Dr. Kevorkian—before midnight on Dec. 31, 2010. It also gives their children an incentive to sign DNR orders and switch off respirators in time for the deadline. This would be a great plot for a P. D. James novel if it weren’t an actual piece of legislation.”

    I read this today and thought of this article. Pfft, don’t retire, off yourselves! Come on, it is truly a fitting end for a “no tax” conservative. Okay, I really don’t wish an ill fate on anyone, but it sure is creepy how many high profile people have died this year…. Don’t let the kids work on the car… just saying.

    Rick Beagle

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