Over the course of a lifetime, an individual can look forward to many new experiences and milestones. For aging adults, a common experience or milestone that will inevitably occur is a change in housing. For some, this can be an overwhelming experience that is full of uncertainty, change and stress. For others, it can be an exciting new chapter, full of new friendships, memories and hobbies.
Depending on a senior’s health status, mobility and need for care, there are a wide variety of housing options to choose from in Ontario.
Life Lease housing developments have been around for many years, but with an expanding senior’s population, this particular housing option has becoming increasingly popular in Ontario. According to the CMHC, there are currently more than 45 Life Lease projects across Canada and many successful projects exist in the United States and Great Britain.
What is the definition of a Life Lease? Life leases are meant for seniors that are on average, 55 years of age or older. Similarly to purchasing a home or condominium, a life lease gives the owner a life time right to occupy a unit and have access to communal facilities and services.
Interested in learning more? Here are five facts about Life Leases that most likely, you didn’t know before:
Life Leases offer a sense of community and provide assurance that you will be sharing the building with people in your same age group.
It’s only natural to want to develop friendships, companions and have a sense of community as we get older. For this reason, Life Leasing housing developments can be the perfect choice; seniors can enjoy a sense of security and peace of mind, while living in a neighborhood that has shared values and similar lifestyles.
A Life Lease plan allows residents to purchase and sell their property at market value.
Life Lease can be closely compared to condominium ownership – in terms of investment return, security of tenure, and property management. When the owner wishes to buy, sell or transfer their property, they receive the market value of their unit (similar to a condominium or detached home).
Life leases can be acquired through a single upfront payment.
The typical cost of a Life Lease is the cost of the construction of the specific unit plus a proportionate share of the common areas of the building. Fortunately, there is no “developer’s profit”!
A Life Lease can be significantly lower than a comparable rental or condominium unit
A Life Lease can often be one of the least expensive housing options for seniors. Residents are required to pay a modest Monthly Occupancy Fee, which generally covers maintenance, insurance, management, and lifestyle services. Usually the monthly occupancy fee is between $150 and $250 (this amount will vary and usually depends the size of the unit, the type of project etc.)
Life leases allow seniors to use their equity and earn a return similar to the equity growth from their previous family home.
As stated above, Life Leases can be closely compared to condominium ownership – especially when it comes to a profitable return on investment. According to the CMHC, “The older homeowners typically are often able to use the equity resulting from the sale of their earlier homes for the up-front payment. In many cases, financing is also available for some portion of the value of the life lease.”
To be safe rather than sorry, it’s always best to directly contact the Life Lease Project you’re interested in. They will be able to answer any of your questions or concerns. Good luck with your move!