It is a difficult decision to make, but sometimes it may be the best option. If your loved one needs assistance with activities of daily living and selling their home would allow them to move into an assisted living facility, then it may be worth considering.

It is exceedingly common for different members of the family to have opinions about which option is the best. "Should we sell their home?", "We should let them age in place like they want!" and "You're all wrong we should rent it and become rich" are common opinions that we hear when families discuss options for paying for a loved one's care. According to Genworth, a leader in senior care research, the median yearly cost for a private one bedroom residence at an assisted living facility in California was $63,000 in 2021. That yearly cost has grown 6% over the past five years.


There are many factors to weigh, including your family members wishes, their health and care needs, the market value of their home, and your own financial situation. Ultimately, the decision should be made based on what would be best for your loved one and what would allow them to maintain the best quality of life possible.


Making the decision to sell your parents' home in order to pay for assisted living can be difficult. There are many factors to consider, and it's important to weigh all of the pros and cons before making a decision. In this blog post, we'll explore some of the key considerations you should take into account when making this decision. Since real estate is often someones most valuable asset, it is important to understand all of the ways in which that asset could generate cash to cover the costs of a senior living community. We'll also provide some tips on what to do if you decide that selling their home is the best option.

Wouldn't renting our parent's home provide long term income?

One option to consider when deciding whether or not to sell your parent's home is to rent the house to pay for their recurring bills. This could provide you with a long-term income stream that could help cover the monthly costs of assisted living. There are however, some things to keep in mind if you go this route.


First, you'll need to make sure that the property meets all safety standards. You'll also need to find reliable tenants and manage the property on an ongoing basis while making sure that the rental rate follows fair market value so that the incoming cash covers your loved ones monthly expenses.

Things to consider when renting a property for the first time

  • Who will manage the property?
  • Who will tenants call with problems and who will be responsible for repairing broken items?
  • Who will collect the rent or chase it down when it's late?
  • How will tenants be screened while following fair housing guidelines and protecting the interest of the property owner?
  • Is it possible for that person to view a family home as a business going forward and does that person have experience running a business?


Keep in mind that this person will now be responsible for paying the property taxes, keeping account for all finances of the property, making sure that all payments are made on any mortgages and maintaining an account for any repair cost. Leaving this up to a family member can make one person feel like they are doing an unfair share of work.

Does your family member have a reverse mortgage?

This is important to consider because a reverse mortgage may only be used for a primary residence. Even if your family member lived in their home when they applied for the reverse mortgage, the loan would become due and payable once their home is rented out. This means that the equity that your family member used to supplement their income would have to be paid back and the reverse mortgage loan would end. Since the home is now being rented to generate cash, your family would not have the ability to draw cash from the homes equity anymore.

Senior living facilities can require buy in fees

Another thing to consider when deciding whether or not to sell your parent's home is the buy-in fees associated with some senior living facilities. These fees can be quite high, and they may not be covered by your parent's savings, insurance or medicare. If you're considering this option, you'll need to make sure that you have the financial resources available to cover the buy-in fee. Otherwise, selling their home may be the best way to generate the necessary funds.

What is a buy-in fee?

A buy-in fee is a one-time payment that's required in order to move into some senior living facilities. The amount of the fee can vary widely, but it's typically a significant amount of money. These fees typically range from $500,000 or more in North County San Diego. Even within the same senior living facility the buy in amount may vary widely depending upon many factors like the size of home that your family member is moving into, location of the facility, level of long term care that is included and luxury options can exceed several million dollars for their buy in fees. Since these fees can be quite high, many families choose to sell the elderly family members home to pay the buy in fee and cover monthly expenses. It is important to ask how much of the buy in fee is returned to the family when their loved one moves out.


Understanding the differences in care facilities

There are a wide variety of care facilities available for seniors, and the fees they charge can vary widely. It's important to understand the different types of facilities and the services they provide before making a decision. In addition to the buy in fee, there are also monthly expenses to consider. Here are some things to keep in mind:

Independent living

Independent living communities are designed for seniors who are able to live independently, but who may want access to amenities like a clubhouse, fitness center and social activities. These communities typically don't provide any medical or personal care services. It can be common for members of these communities to still work and live a highly active lifestyle.

Retirement Communities

Retirement Communities offer a similar lifestyle to independent living communities, although they offer amenities these communities require the highest level of independence.


These communities may also offer care services like housekeeping and laundry. They do not offer any type of medical, short term or long term care. There are several throughout North County San Diego that limit the age of residents to 55 and above. One advantage to these communities is that the homes are owned once purchased. Some families do choose to rent these homes out to other seniors once they have moved to a professional care facility. Although these communities have a lower price, their main benefit is a community of similarly aged individuals.


You may find homes in these communities for sale or homes that are available to rent. Not all are practical or easily accessible. Many of these communities have homes that cost less than homes that are not in age restricted communities. This can help some people lower monthly expenses by lowering their mortgage payment or using proceeds when selling a home to buy their new home without a mortgage.


Be sure to inspect the walkways and account for any stairs that your loved one would need to navigate during different times of day. The level of ease of accessibility can limit the useful life of some of these homes.

Assisted living facilities

Assisted living facilities provide basic medical and personal care services, like help with bathing, dressing and medication management. These facilities also typically offer social activities and other amenities.

Nursing homes

Nursing homes provide around-the-clock medical and personal care for seniors who can't live independently. These facilities are typically more expensive than other types of care facilities, and they may not offer as many amenities. Genworth has quoted he median costs of a semi-private room in a nursing home in California to cost approximately $117,530 per year. A private room jumps to $146,000 per year on average!

Memory care facilities

Memory care facilities provide specialized care for seniors with dementia or Alzheimer's disease. These facilities are typically more expensive than other types of care facilities, and they often have a higher staff-to-patient ratio.


One way to determine which type of facility is right for your family member is to talk to their doctor and tour different types of facilities. It's also important to consider the cost of the different types of facilities and whether your family member will be able to cover the costs with their savings, insurance or medicare.

What may surprise you

One thing to note is that the longer your loved one waits to make a decision about their plans, they often need to undergo a physical and mental health screening. This assessment process is completed to ensure that an individual will not need more care than a community could provide after they move in. Making the decision and committing to plans while your family member is still in excellent health is they key to making sure that they have the highest level of influence when deciding where they will live in the final years of their life.

What do we do with all of their stuff?

When a senior moves into a care facility, they often have to downsize and get rid of a lot of their belongings. This can be a difficult process, both emotionally and logistically. Here are some tips for downsizing:

Start early

It can take longer than you think to go through everything, so start the process as soon as possible. Starting early also benefits everyone so that help can be arranged between family, friends, volunteers and professional services.

Be realistic

Your family member probably won't be able to take everything with them, so help them prioritize what's most important. Taking time to go through the house and asking why items are important to your family member could help them realize that it is safe to let go of their belongings.


Be aware that your loved one may want to hold onto more items because selling or donating those items represents a big change. Showing care, pausing to listen and bringing out the positive of letting go may help some people. Understanding what parts of the process are exciting or frightening to your loved one can help you navigate and honor the emotions that they experience.

Get help

Enlist the help of other family members or friends to make the process easier. There are professional companies that help seniors move by packing and unpacking. Professionals that help organize are also great to have help when you move your family member into a new home by creating familiarity and order in their new home. A group that I personally love in San Diego County is Simply Luxe Organizing. They are sweet, efficient, caring and their work is as their name states, luxurious.


If your family cannot afford to pay for help there are volunteer organizations and church groups in every community that often help seniors move for free. Another creative trick is to have friends come help and provide lunch and refreshments for their help.


Senior move managers are readily accessible in San Diego, with multiple professionals servicing the area. These are companies that specialize in helping seniors by arranging the entire moving process.

Donate or sell items:

Donate items that are in good condition or sell them. There are many great places like DAV and the Salvation Army which will arrange pick ups or accept drop off donations. According to estate sale companies that I work with, there have been problems getting donation companies to take larger furniture items like beds and sofas. They suggest gathering items that charities will not take and having those disposed of if the furniture cannot be used after the move.


Larger items may be best sold on OfferUp or Facebook market if you have the time to arrange for buyers to come to the home to pick up the items. Some families find this to be more convenient than having a yard sale.

Aging in place and what that looks like

Aging in place is the ability to live in one's own home and community safely, independently and comfortably, regardless of age, income or ability level.

There are many ways to make a house more senior-friendly, so that aging in place is possible. Some seniors may need minimal changes to their home, such as installing grab bars in the bathroom or adding a ramp to the front door. Others may need more significant modifications, such as widening doorways or installing an elevator.


The important thing is to start planning early, so that you can make the necessary changes before they are needed. This will give you time to research different products and find the best ones for your needs. Planning before the items are needed also helps limit costs because there is no rush to solve a problem.


While aging in place is many peoples idea situation there are many financial considerations to discuss in addition to property modifications. Many age specific modifications to a home have a low return on investment. At some point, when selling a home that has been modified for a senior, you may have to reverse some improvements to the house to get the highest value possible.


A more serious financial consideration when aging in place is that according to Genworth in 2021 the average cost for a home health aide in California was $73,216 annually. A cost that continues to increase year over year.


Unfortunately as the increase in need for care rises, so do the costs. Being proactive can save a lot of grief when your loved one needs more care as they age. Although many seniors age gracefully in place it is great to have a plan in place should an accident or unexpected health event take place.

Selling a home to pay for care

If you are considering selling your home to pay for care, there are a few things you need to know. First, it is important to consult with an experienced real estate agent to find out how much your home is worth. Once you have an idea of what your home is worth, you should ask your real estate agent what the process of selling your loved ones home is like. There may be a difference in value whether repairs or improvements will be made before placing the home on the market.


Selling a house can be an emotional process, especially when you are talking about selling a parent's home that has many fond memories. It is important to remember why you came to the decision that selling would be the best option. The decision to sell is financial and it is helpful for everyone to keep their emotions in line so that their goals are accomplished when selling a house. Many people decide to sell to have extra money available for unforeseen costs or to pay for the upfront costs when moving into a senior living community.


The biggest challenges for many people when selling a property often relate to moving personal items, organizing, cleaning and making repairs of deferred maintenance items. Although this concerns many people in this situation, the great news is that there is a buyer out there regardless of the condition. That condition of the house will have a huge impact on value and it is important to have a Realtor® who is able to explain that value to you. This person will understand the challenges of the neighborhood as well as why buyers like the neighborhood.


When you decide to sell a home to pay for a loved ones transition into a senior living community you have the option of selling to an investor or selling traditionally. An investor will likely offer a less than market value for the home while a buyer on the open market may pay you more for a home that they would fix to live in. While an investor may pay less, they can often close the sale more quickly, sometimes within a week. Although a buyer on the open market may pay you more, if a home is in very poor condition, they may not be able to get a loan for the purchase.

Weighing your options

The best way to weigh your options is to gather all of the information. Since real estate is often a person's most valuable asset it is important to understand how to leverage that asset to pay for long term care.


No matter what you decide is best, give me an email, text or call and I will be happy to provide free insight to the value of your loved ones home, how much it could possibly rent for and local resources that will make the process easier for you. Whether you decide that selling a house or renting it out would be best, I am happy to help!


Scott Stollar