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Retirement properties – a good deal?

THE QUESTION

Do you have experience with renting Retirement properties?  Is it a good idea to buy a flat at the seaside and rent it as a retirement property?

THE ANSWER

There are two issues here:

  1. Renting properties that are part of a retirement complex.
  2. Buying a flat and renting it to a retired person – or people.

Number one is a great idea if you have cash to burn! No mortgage lender will touch these with a bargepole.

Retirement properties have covenants that restrict who can buy them, who can live in them and whether they can be rented.

All retirement properties will be restricted to people who are over 55 years old.  Some will only be able to be bought by buyers over that age and many will only be permitted to be occupied by the owner and renting out is prohibited.

If you want to park your cash in a flat that can never be mortgaged, can only ever be sold to someone over 55 and has age restrictions on who can live in it, great.  The reality is there are probably much better, less restricted deals around.

This really is a cash buyer only purchase.

Number two is a different issue.  If you want to buy a ‘normal’ flat and rent it to retired people you could do that, but you could not promote it as ‘retirement property’.  That term has a very specific legal meaning.

 

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