RETIREMENT
Retirement Villages Still A Safe Bet
Demand for propery soars
R
JESSICA KOLVER
Jessica Kolver has been working in the property industry for the past five years, managing advertising, marketing and sales. Before joining Engel & Völkers, she worked at Dunn Properties, as Sales Manager at Liberte Properties and also did a stint as fashion buyer at Truworths. She holds a B. Com. degree from the University of Stellenbosch.
esidential units in retirement villages have proven to be some of the best property investments, with unsurpassed high returns being the order of the day.
La Récolte Retirement Village, situated in Stellenberg in the Northern Suburbs of Cape Town, is an exclusive development offering residents the ideal place to call home. Advantages include lock-up-andgo lifestyle, state-of-the-art security and facilities, as well as luxury finishes.
We’ ve seen an upward trend in the demand for retirement properties. This sector is driven by ground rules, supply and demand, and at the moment demand far outweighs supply.< end breakaway box >
Most of the retirees today form part of the baby boomers, born between 1946 and 1954, making them between the ages of 63 and 71. Since 2011, baby boomers have entered the retirement phase and will continue to do so for the next 10 years. According to studies, most of the baby boomers are well educated and had successful careers. However, many are not financially prepared for retirement as they have high levels of debt and are the first generation in history to enjoy the widespread use of credit.
This has changed the way we see retirement and its products and services significantly.
This group also received improved medical care, medicines and lead healthier lifestyles than their predecessors. This leads to a demand for retirement villages and less availability in existing traditional old age homes. Living longer is a challenge for people who retire on a fixed budget, having to pay for medical care out of their own pockets, due to the rapidly increasing medical costs and services putting pressure on medical schemes. These costs could derail their financial plans during retirement.
We’ ve also seen much interest from children of baby boomers. They were born between 1966 and 1976. Generation X( Gen Xers), as they are known, often support their parents in some way and also see buying into a retirement village as an investment in their own future retirement.
Prime investment
Those in the position to do so, would be smart to invest in retirement villages. It’ s been clear, for several years now, that this market doesn’ t follow the residential market. There is oftentimes a waiting list of people who want to purchase homes in the established villages, making it an ideal investment.
Although one can only live in a retirement village from the age of 50, those able to should consider investing much sooner due to the massive long-term benefits. Not only does it allow you to plan ahead for old age, you also invest at today’ s prices, ensuring that your capital investment increases in value. The developments usually include a selection of various sized apartments, townhouses or houses. A wide selection of residences caters for the varying ages and needs of retired individuals. Many retirees buy a home where they can still enjoy their independence, with the option of moving into an assisted living suite or frail care facility within the same development. It’ s all taken care of
When you stay in a retirement village, you become a member of a small community with like-minded residents that are at a similar stage in their lives. Many retirement villages also offer regular activities and trips. Chances are great that you’ ll make friends, so you’ ll never be short of company. Another advantage is security. Most retirement villages come with the latest safety and security measures such as 24-hour security with access controlled gates, electrical fencing, closed circuit television( CCTV), alarm systems, and more. It offers peace of mind whether you’ re at home or away. As with all properties, position is key. Apart from security, frail care facilities and a lock-up-and-go lifestyle, retirees want to be close to shopping centres, recreational facilities, hospitals and clinics, and have easy access to highways. Retirement homes are designed around your needs, allowing you to live your life to the full without worrying about anything. You have DStv connectivity, Fibre Internet, optional homecare nursing, landscaped gardens and affordable, stable levies. You can go away for long periods to visit your kids or go on holiday. It’ s completely stress-free and the perfect option for anybody 50 years and over. It offers every comfort and convenience, whilst being close to city amenities. Every retirement village has its own legal structures which important implications. It’ s therefore important that buyers understand what they are buying into before signing any contracts. They should also ensure that the Retired Persons Act is adhered to by the developer and ensure they are aware of the levies, and other costs involved.
Once all that is taken care of, investors can sit back and be confident that they have bought into an asset class which will offer great financial returns in years to come,”
SOURCES larecolte. co. za, Engel & Völkers
28 NOVEMBER 2017 SA Real Estate Investor Magazine