My father has been living on a shoestring for most of my life (divorced), and I've always been worried about how/whether I'd be able to support him in old age. My hometown is a relatively cheap place to buy a house, and I've been wondering for a few years how feasible this would be. Do you have experience doing this or thinking about doing this? I'd love your thoughts on the idea in general and our specific circumstances below.
My parents are both in their early 70s, and both in great health. My mother has a pension and some savings, but my dad's living situation has always been a mystery. I understand from my sister that he gets a miniscule pension from a government job many years ago, and we assume that he is receiving Social Security. He's been visiting the doctor regularly only for the past few years, which suggests that he's taking advantage of Medicare, for which I'm incredibly grateful.
He has been stubborn about money in the past, refusing to let me pay for him to visit when I was working abroad, e.g., not letting me pay for the hotel on a vacation I invited him to join. I definitely need to talk frankly with him about his income and plans (with my mom as well) - I know that I've put it off for ages because I don't live in the same place, am nervous based on previous money conversations, etc., and need to just bite the bullet and go for it. His current living situation is a tiny basement apartment, a place that hurts me even to think about.
Our hometown is a place where it's possible to buy a fixer-upper in a shitty neighborhood for half of my take-home annual pay, and a decent 3-4 br. in a decent neighborhood for 1.5x that amount. My sister and I have talked briefly about the possibility of working together to buy him a house, and my dad has talked longingly of being able to buy a house; sometimes I get on Zillow and poke around and see things that I think he would like and could make his own and could be a place for him to live independently for a fairly long time. My dad is an engineer and has been his own super/mechanic/plumber/electrician for the past 40 years, and so we might even be able to find a place for a bit less that he would enjoy investing sweat equity into to make his own. The idea that a better place to live could help him age happily and healthily in a home of his own is very attractive.
I've daydreamed about finding an affordable house with a few bedrooms and multiple baths so that he could have roommates (who could be company and also help defray the cost of the mortgage), but it would be more expensive to go this route, and I'm less sure about his ability to find/retain roommates at his age. I've mostly been looking at 2-br, 1-ba places. There aren't a lot of ranch-style places in our city, but I'm finding a few that could work.
My partner and I live and rent across the country - while we may eventually buy a place, it's not on our radar for at least a couple of years. I have fantastic credit, enough savings to put a 10-15% down payment on the places that I'm looking at (have discussed with partner), and my sister may be able to contribute as well. I've found some general articles about tax considerations (e.g., buying as an "investment home" and then charging rent, co-signing on a mortgage if the parent can't qualify on their own). From an earlier Ask about aging parents who are stubborn about money, I've learned about BenefitsCheckup.org, which motivates me to think about proposing this to him in concert with talking about SNAP and other assistance programs ("Dad, if we get you on SNAP then you would be able to afford this mortgage out-of-pocket - how awesome would it be to have enough room for your books!"). I will certainly talk with a financial planner at some point if we decide to go ahead with this.
The main concerns I can think of: complexities around multiple-people purchasing - contingencies that always come up in owning a home, which would fall on my sister and I (and our partners) to deal with (and probably more on my sister and her partner, since they live in our hometown) - it would be my first home purchase, and so I might be giving up any first-homeowner credits or advantages that my partner and I might want to use later - potential credit issues for me/my sister if something went wrong (this seems unlikely while my father is alive, if he's on a fixed income) - our hometown isn't a growth market, and so we'd go into this knowing that breaking even would be great, and that we might even lose a little money - it might take a while to sell the house whenever that *does* become necessary, and so we'd be on the hook for paying the mortgage while trying to sell it in future....
Does anyone have any experience doing this? What worked well? What was disastrous? What else should I be thinking about? Thank you! |
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