People rent in retirement for all sorts of reasons. Some have never been homeowners, some sell their properties to boost their pensions, and some sell up in order to enjoy more flexibility in terms of where they live. A sub-category of this third group may be both landlord, as they are renting out their own home, and tenant, as they want to live elsewhere without losing the safety net of owning their own property.
What's more, is the number of retiree renters is on the rise. This creates opportunities for landlords, especially those looking for tenants who are keen to stay in a property for more than six or twelve months. However as with any rental demographic, it's important to think about the needs and wishes of this group of tenants in order to boost your chances of a successful let.
Specialist retirement properties
Usually marketed at the over-60s, and sometimes the over-50s, these properties are usually clustered together in a "retirement village". Some have shared onsite facilities such as a concierge, communal garden, café or even a library, while others rely on attracting residents by virtue of appealing to those who want to live close to others of a similar age.
Most retirement properties are sold on a leasehold basis. If calculated per square footage, sold property prices for these sorts of homes are frequently cheaper than for homes sold on the open market. This, together with leases that are often 999 years, can make them attractive purchases. As a potential landlord of one of these properties, it's important to bear in mind that when you decide to sell, you automatically have a reduced pool of potential buyers. This need not necessarily be a concern provided you are selling somewhere that's attractive either to another investor, or to an owner-occupier. However it does highlight the importance of ensuring you're buying the right property in the first place.
Homes on the open market
Unsurprisingly, the importance of buying the right property in the first place also applies to any purchase made on the open market. Where you choose to make that purchase may be influenced by factors other than your target rental demographic. For instance, perhaps you want a property that's close to where you live to make managing and looking after it as easy as possible. Alternatively, perhaps you're looking to buy somewhere with the ultimate intention of moving into it in your own retirement. You might also of course be led by what you can afford to pay, in which case price will be at the forefront of your mind. You shouldn't forget to include projected rental yield in your financial calculations.
The other point to bear in mind when buying on the open market is that you may face greater competition for properties. This can drive up sold property prices and mean that you end up paying more than you'd hoped. That said, as with any rental investment purchase, it's imperative to set a budget and stick to it.
What to look for in a property
Of course retirees are not a generic category, and different tenants will have wildly differing needs. However without making assumptions, there are several features you might wish to look for, or to add to a property. For example:
1. Proximity to amenities
Easy access by foot or convenient public transport to local shops, doctors' surgeries, hospitals and places of entertainment such as cinemas, theatres and restaurants are high up many people's wish lists. Retired people may be even more mindful of the need to ensure they can access such facilities without relying on a car or the necessity of a lengthy or convoluted bus ride.
2. Car parking
Despite (1) above, plenty of retired people run a car, and plan to continue doing so. Even if they don't they may have visitors, potentially including carers, who arrive by car and need somewhere convenient or accessible to park. Consequently a property with its own car parking will almost always be preferable. On-street parking, unless it's private allocated parking within a very close distance of the property, is less attractive especially to anyone with mobility issues. Nowadays it's also a bonus if the parking area allows for the installation of an electric vehicle charging point.
3. Outside space
While many people choose to scale back the size of their gardens if they move house as an older person, it's rare for someone who's always enjoyed gardening to choose a new property without its own outdoor space. It need not necessarily be very large, but as a landlord you're likely to find that properties with some sort of garden, terrace or balcony let more easily than those without. Although many tenants will be happy to take on the gardening themselves, if you have concerns you can always arrange for a gardener.
4. Not too many stairs
It's a bit of a cliché to suggest that retired people always want bungalows. Indeed there's plenty of evidence proving that younger people also appreciate single storey buildings, so they are definitely worth considering. Places such as Eastbourne and Bournemouth, that are traditionally very popular with retirees, tend to have a plethora of bungalows, but you can find them in most neighbourhoods. In some areas you may find their popularity, which is often to do with the larger than average plots many are situated on, means they attract a premium that can put them out of your reach. In those circumstances, or for your own reasons, you might want to consider a traditional two or even three storey home. Choosing a property without multiple steps up to the front door or a terraced garden is probably sensible.
5. A downstairs bathroom
Downstairs bathrooms, or at the very least a toilet, are much appreciated by anyone with mobility issues. In a similar vein, a home that isn't completely open-plan can also work better for anyone who needs to sleep downstairs.
Nethouseprice newsletter
You can sign up to our newsletter and join Nethouseprice’s community of over 160,000 members who get regular property tips, relevant offers and news, click here http://nethouseprices.com/auth/user-register
Make a comment