“Live Free and Die,” by Henry Grabar, Slate
“Is Grandma having trouble with her property taxes? A new Manhattan-based startup wants to buy her house and let her live there, for free, for the rest of her life. This makes sense as a business for a couple of reasons: For one, seniors have the nation’s highest homeownership rate. Close to 80 percent of Americans over age 65 own their homes. At the same time, older Americans are increasingly likely to retire without the savings to see them through their twilight years. In 2013, median retirement-account savings for families age 56–61 was just $17,000—and even the mean, $163,577, is considered far below the recommended rate of 10 times your salary. Put the two together, and you’ve got the idea behind the startup, Irene. The company will even take care of property taxes and maintenance, so your grandparents don’t have to clear out the gutters or risk falling into foreclosure. The trade-off: a sale price far below market value.”
LTC Comment (from Stephen A. Moses, Administrative Coordinator, Center for Long-Term Care Reform):
Interesting twist on the reverse mortgage idea, but have they considered the least recognized reason why reverse mortgages lag? To wit, Medicaid exempts the home and all contiguous property up as much as $858,000 in some states, at least $572,000 in all states. If you can keep your house rent free and get home care from Medicaid (New York is especially generous), where’s the advantage of selling the house for half price? That’s a question this new start up should consider.
#homeownership
#goldencareagent
