Welcome to this month’s installment of Dear Urbaneer, where I take on fascinating real estate questions from our clients and readers. 

This month, I am helping a homeowner who has roots in Toronto, but who has spent the last several years living out of province. She wants to return to the City for her golden years and be well-positioned to age in place. She is wondering if it is preferable to buy or rent when making a move to age in place.

Dear Urbaneer,

Five years ago, my partner and I moved away from Toronto to a bucolic ocean setting on the west coast. Although we are grounded in retirement and happy, I worry about our future and fear isolation. Having easy access to amenities, health care, entertainment and our larger established social circle cultivated over decades are qualities of life we are beginning to prioritize again. 

We are not quite ready to move back to Toronto full-time just yet, but are planning our next steps, and are working out the timing. In addition to figuring out when we make the move, the other question is, if the goal is to age in place, is it better to rent or to buy a home? We are also thinking about living part-time in Toronto to start and keeping our west coast property for the time being. 

Signed,

Ready, Set, Golden Years 

Here is my reply:

Dear Golden Years:

Throughout my 35-year career, I have seen many Torontonians cash out of their “Bright Lights Big City” lives for an episode of “Escape To The Country.”  After crossing the tightrope of hopes & dreams while spinning the plates of higher learning, career-pathing, & child-rearing and a quick change side show of opening-this & gala-that, when some folk finally cross the threshold of retirement they realize just how burnt out they are. Rather than try to decompress amidst the freneticism of a population stuck in gridlock and 5 minutes late, they just pack up one day, say “Bye!” and wake up the next day to feed the alpacas. If this is you, pat yourself on the back and say ‘Well Done’.

One might call it a rite of passage.

But what we hear less of but is equally common, is that a lot of those same people return to the urban centre they fled in their mid to late 60s a decade later. Why? They start prioritizing proximity to amenities that are particularly supportive of aging in place, that are convenient, socially stimulating, and life-enhancing. Think spoiling grandkids, giving up night driving (or driving altogether), and hitting the thrift shop.

There is also a sense of community being in an urban area, a tradeoff for wide open space in rural settings, where quietude- but also isolation- characterizes the experience. 

And you are wise to be thinking ahead. It’s during this time period that you find yourself when you are approaching, but not yet arrived at, the need for housing to be supportive of aging in place. It’s when you’ve got time to pause, think and weigh all the options, with ultimate control over the situation.

In a past Dear Urbaneer post – Dear Urbaneer: What Is The Best Process For My Elderly Parents To Downsize And Sell Their House? – I counselled a client whose parents had to move quickly, as a spot in their desired retirement home had come up. The family was faced with a series of decisions and weighty tasks, such as deciding to sell or rent the family home, downsizing from a lifetime of accumulated goods that wouldn’t fit in a smaller home, and navigating a completely different lifestyle. 

The message of that particular story is- if you plan ahead when decisions are not urgent, the change can be more gradual, and you can steer your own ship more expertly as you move to the next phase of your life. 

For more extensive care, the question of when to move really depends on the situation, but there are telltale signs, around memory loss, limited ability to conduct daily tasks safely and mobility challenges, as outlined in this Forbes article: “When Should You Move To Senior Living?”

So- in other words, don’t leave this decision too late, as things that we take for granted in our current residences, may be the source of new challenges as we age. And remember housing is intended to be supportive of whatever stage we find ourselves in: student, first-time homebuyer, growing family, property ladder climber and downsizer. 

Furthermore, it takes time to cultivate a community in which to age in place, to maximize your care and make sure you are getting the most out of the city. 

I speak from my own experience. I bought my place in PEI in my 40s to age in place there. 

For the first 15 years, I came once or twice a year for a week, but when the pandemic came I had a great reason to move here for an extended period of time. 

I always say to people, don’t leave it too late to move into your final residence because you need to be active, engaged, and willing to integrate and develop your social network. A lot of people leave it too late when they don’t truly have the energy, health or motivation to begin a new chapter. 

There is merit in becoming a familiar face in the community so that your friends and neighbours will be innately checking in on you, and likewise you for them.

So to answer your first question, the advice is to make the move sooner rather than later. Also, you’ve mentioned a desire to either buy or rent your own residence with your partner, with plans to age in place together.  Before we explore the pros and cons of these through the lens of aging in place, let’s explore some of the other options that are becoming more common.

Choices For Aging In Place

The lockdowns of COVID-19 had many lasting impacts on housing. 

The lockdowns shone a bright light on gaps in the system when it comes to elder care, including housing, and care policy. This new awareness has paved the way for a few different models of homeownership that are growing in popularity, in part because of the challenges of affordability in a pricey city like Toronto, but also as families or groups of friends, or like-minded investors, have taken matters into their own hands, -so to speak.

Multi-generational housing (which I wrote about in last month’s Dear Urbaneer: What’s Driving The Trend For Multi-Generational Housing In Toronto Real Estate?)  – is a viable option to let parents age in place, cared for by their adult children. They can live in the main dwelling, in an in-law suite, or perhaps reside in an outbuilding (like a garden suite or laneway house).

This is a great background piece on multi-generational housing:  With COVID-19 Outbreaks In Long-Term Care Facilities, Is Multi-Generational Housing Better?

Another popular option for aging in place is co-ownership, which I wrote about here: How To Create Co-Ownership Options With Freehold Housing

ONe more! I weighed the pros and cons of various options between downsizing, staying put, and aging in place, or moving into a retirement community here: Dear Urbaneer: Do We Age In Place, Downsize, Cohouse Or Move To A Retirement Community?

There is another phenomenal gathering steam as well, Naturally Occurring Retirement Communities (NORC), which is outlined in this article from the Walrus: “You Don’t Have to Move into a Nursing Home. There’s a Better Way.” Essentially, seniors realizing the limited autonomous options available for elder care, are taking matters into their own hands by establishing self-sufficient retirement communities in condo and apartment buildings. 

It’s part network, part housing community, and these age-in-place groups can even exist within other buildings that house the general public, unlike a retirement home or Long Term Care Facility. There are clusters of single-family homes in neighbourhoods that satisfy the criteria as well.

Essentially, these communities (you generally need to be 65+ to apply/join) offer options for leisure, programming, on-site health care and more, as determined by the residents themselves.

These NORC groups have done well in the United States, but have not had a lot of traction yet in Canada – with the exception of Toronto. The University of Toronto Health Network runs the NORC Innovation Center, which supports seniors looking to DIY aging in place.

Supply & Demand, With A Twist

The mismatch of supply and demand is always a storyline in Toronto, usually contributing to rising or declining prices across various housing types.

But for aging in place, there is a mismatch between the supply of housing that is appropriate for aging in place. The end result has been seniors moving into nursing homes or similar, when other options may have been more appropriate.

It’s a well-known fact that homeowners are staying put in their homes for longer than in generations past, which has been impacting the natural filtering of stock into the property ladder. However, this article from the Globe and Mail explores how this may be in part because there is no where really suitable for seniors to go: “Forget Downsizing: Canadian Seniors Staying In Large Houses Well Into Their 80s, Due In Part To Lack Of Options.”

A CBC article looks at the irony of such razor-thin vacancy rates driving up rents in a number of cities across the country, as well as leaving seniors with limited options, who would prefer to rent (which is a common choice as people age). However, retirement homes abound, and more are being developed all the time, but they can be very pricey- and not necessarily what all retirees want: “It’s Nearly Impossible To Find A Place To Rent. But Retirement Homes Have Room To Spare”.

And then there is the introduction of this policy, where sick people who have had serious health complications and hospital stays, and need higher level care when discharged (i.e. Long-term care facilities), that these patients can be sent to a home up to 70km away from home, regardless if the home is one that they chose (or would choose), if that is where the space becomes available. This CBC article – “Ontario Moved 424 People Into Nursing Homes They Didn’t Choose” – outlines some of the pitfalls associated with that policy, the reality of space, and what families are up against. 

 So, back to your question about renting versus buying to age in place, and the timing of the move. Here are my thoughts.

‘Try’ Before You Buy

One option that people in your position take on is by having a pied a terre in the city, either as a longer-term lease, or as a short-term rental. This lets you experience what life might be like on a more everyday basis, in your desired neighbourhoods (and city), offering a different and more immersive experience than simply staying in a local hotel or with friends for shorter periods of time.

However, be careful with this option. And here is why

In your case, you indicate that you will be living part-time in Toronto, while still keeping your rural residence. How often do you think you might be in Toronto, over the course of a year?

 If you were to lease an apartment in Toronto for a year, at which point it would roll over into a month-to-month rental, you run the risk of being caught in a perpetual playback that says “I’m not going to Toronto frequently enough to justify this expense.” So to overcome this you might start scheduling flights which run the risk of being ‘too structured’ and, by default, ‘more obligatory than fun’. That’s going to cloud your desire to move back to the city.

Is owning or renting better? That depends on a number of variables, so below are some points to consider.

• How do you feel about owning vs renting?

The other main criterion is what is more important to you: the ease of turnkey living, or are you someone who really values the concept of owning and growing the value of a real estate investment? 

How much control do you require over your living arrangement to be happy and satisfied? Renting invariably means that you’ve got less control over things like renovating and decorating (to a certain extent), pets and other rules, a tradeoff for the freedom that comes with turnkey living.

Or, are you, like me, a person who has to own their residence because when we do, we fully invest in them physically, mentally, emotionally and spiritually. The space becomes ‘a place’. This may be because we feel most at home when we have security of tenure, agency over our environment, and/or freedom of creative expression. If you can buy a property and enjoy all of these privileges, why would you rent an apartment and have none of them, if you know that is a high priority?

Home ownership represents a lot more than just shelter, and hits on psychological, psychological and emotional levels, as I have written about in Maslow’s Hierarchy Of Needs And Toronto Real Estate For Buyers and Maslow’s Hierarchy Of Needs And Toronto Real Estate For Sellers

There is no right or wrong answer here, it is just a question of having a hard look at what would make you happiest, reconciling your own priorities.

• Do the numbers work?

In your case, you intend to keep two residences. Do you have the cash flow to support paying rent, without the support of asset growth in a real estate investment? Do you have other liquid assets to support your lifestyle if you tie more of your money up in real estate?

The other question is to really think about how often you’ll be visiting Toronto, and how long it realistically would be to when (and if) you moved back full time?

In Toronto, shelling out 48k to 60k a year in rent to visit, say once a season, might seem wasteful. But if you are there monthly, or more, it might seem more appealing, depending on your financial situation.

Whereas,  buying a condo, and spending 20k a year for common fees, utilities and taxes along with a mortgage payment (if you finance), might be even more appealing, as you own the asset and its growth might offset the costs. 

I do believe it’s wise to have a diverse portfolio, including investment vehicles that generate higher returns and some that are more liquid but we’re also not taking our money with us so we should spend it on quality of life. 

Here’s a piece that sheds light on that perspective from the Globe & Mail, entitled,  “Many Canadians Underspend In Retirement For No Good Reason. Here’s What They Can Do.”

• What’s your timeline?

Along the same lines, how long do you intend to own, if you do? It takes several years (estimates say around seven years) to break even from a property purchase, when you consider fees, costs and more. 

Age is a factor here as well if your goal is aging in place, as the general answer here to how long you’d like to stay in your home is “as long as possible”. That’s not always clear-cut when aging. Have an honest think about what timeline is reasonable and likely, and if you could realistically look at generating a return on your investment if you were to buy. 

• How do you feel about maintenance?

Hands down, one of the best parts of renting is that you don’t have to engage in maintenance, which is not only convenient, it can be very important in the context of aging in place. Some tasks that you may feel comfortable, or not mind doing now as a homeowner, may become difficult or even impossible in the future, as health and mobility might be negatively impacted as you age.

If you did opt for ownership over renting, can you outsource maintenance and other tasks? Does that fit the budget?

For Both Owning & Renting

Take the real estate mantra, location, location, location to heart. Choose a home in a location where you’ll have easy access to healthcare, public transit and amenities that are meaningful to you, that will boost your lifestyle. Having to move a few years in, because you can’t get around easily without driving yourself, for example, will erase any gains, and you’ll have to start over again, possibly without the benefit of time to make a slow and steady decision as to what suits you best.

As you can see, renting versus buying is never a one-size-fits-all, and when you incorporate the priority for aging in place, the question becomes more complex. That’s why you need a seasoned realtor by your side who can truly, deeply understand the pros and cons, support your decision (whatever it is) and help you find the property that suits you, and your priorities, best.

I am here to help!

If you enjoyed this topic, here are some supportive blogs that may engage you:

• Dear Urbaneer: What’s Driving The Trend For Multi-Generational Housing In Toronto Real Estate?

• What’s Trending In Toronto Real Estate?

• Dear Urbaneer: Do We Age In Place, Downsize, Cohouse Or Move To A Retirement Community?

• With COVID-19 Outbreaks In Long-Term Care Facilities, Is Multi-Generational Housing Better?

• Dear Urbaneer: What Are The Tasks & Timeline When Selling Your Home?

• Dear Urbaneer: What Is The Best Process For My Elderly Parents To Downsize And Sell Their House?

• Dear Urbaneer: What Are The Buyer Profiles For Multiplex Properties?

• Design Innovations For A More Affordable Canadian Housing Future

• All Residential Properties In Toronto Can Now Become Four Units As-Of-Right

Want to have someone on your side?

Since 1989, I’ve steered my career through a real estate market crash and burn; survived a slow painful cross-country recession; completed an M.E.S. graduate degree from York University called ‘Planning Housing Environments’; executed the concept, sales & marketing of multiple new condo and vintage loft conversions; and guided hundreds of clients through the purchase and sale of hundreds of freehold and condominium dwellings across the original City of Toronto. From a gritty port industrial city into a glittering post-industrial global centre, I’ve navigated the ebbs and flows of a property market as a consistent Top Producer. And I remain as passionate about it today as when I started.

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Thanks for reading!

-The Urbaneer Team

Steven Fudge, Sales Representative
& The Innovative Urbaneer Team
Bosley Real Estate Ltd., Brokerage – (416) 322-800

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