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HindustanTimes Fri,18 Apr 2014

Choose a retirement home you can afford

Vivina Vishwanathan, Hindustan Times  New Delhi, August 30, 2013
First Published: 23:26 IST(30/8/2013) | Last Updated: 23:31 IST(30/8/2013)

Two years from his retirement in 2000, Hari Sundaresh, working at World Bank in Washington, decided to buy a house for himself and his mother back in India. At 58 years of age and with a 73-year-old mother to tend to, he chose a project specifically meant for senior citizens, which came with round-the-clock medical care.

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Athashri, the project in which he bought into, is 10 km from Pune city and has been developed by Paranjape Schemes (Construction) Ltd, one of the few developers tapping the retirement homes concept in India.

Under the senior living concept, there are two categories — independent living and assisted living. In assisted living, you will get 24x7 services and is meant for senior citizens who need help. Independent living is for active senior citizens who can take care of themselves. Most retirement projects provide both the facilities in the same space.

As per an April 2013 updated report titled, Senior Living Sector in India, by Jones Lang LaSalle India, currently there are 30 completed retirement or senior citizen projects in India. Bangalore has seven such projects, the highest in India, and there are 30 more such projects in the pipeline across the country.


The facilities
Medical care: The medical facilities vary from project to project.

Ankur Gupta, joint MD, Ashiana Housing Ltd, said, “The medical facilities that we provide include 24x7 ambulance service, physiotherapy, a round-the-clock nurse and OPD service, among others.”

Usually, developers have tie-ups with medical care providers. For instance, for healthcare, Tata Housing Development Co Ltd in Bangalore has tied up with Apollo Healthcare Ltd for all the services.

Food: Most retirement homes provide a mess facility. “We have a basic menu which is designed based on senior citizens’ nutritional needs,” said Muralidhara Bhat, care home manager, Ashiana Utsav Care Home, an assisted living project by Ashiana Housing Ltd. “For people who have special needs, we even provide customised food.”

The charges for this facility varies from builder to builder. For instance, Athashri’s mess charges Rs. 45 per lunch plate, whereas Ashiana charges Rs. 60 per mini thali and Rs. 80 per thali. But they cannot be compared one-on-one as the food quality and other factors differ.

Feeling at home: The biggest facility that these homes provide is the emotional comfort since they are not the typical old age homes, which remain a taboo in our society. “There is a misconception that a retirement home is like an old age home. Here I have more friends and more activities,” said 64-year-old Asha Bhatia, a resident of Ashiana in Bhiwadi.

The restrictions

Age limit: Unlike in an ordinary project, here only people above the age of 55 years can reside. If your spouse is below the age of 55 years, she can live in the retirement home as well.  If you have kids, they can visit you. Though there is a limitation on visiting days of around 60-90 days.

Inheritance and resale: Like any other project, your child can inherit the house. However, she can’t live here until she becomes a senior citizen. That means she will have to either keep it shut or rent it out compulsorily to a senior citizen or wait until a certain age.
Mathew Cherian, chief executive officer, HelpAge India, said, “The retirement homes are for people who are wealthy or have non-resident Indian children who can afford to buy these properties.”

Also, if an heir wants to sell the property, the new resident should be a senior citizen. This may accentuate liquidity problems. Amit Kukreja, a Delhi-based financial planner, said, “Considering that only senior citizens can rent it out or the new owner who resides in these house should be a senior citizen, it makes the property more illiquid. This is because people who rent will be those who have an income. So when the category that earns is removed, you will have fewer options.”

Costs: If you are planning to buy a retirement home, you will end up spending more than what you spend on a normal house in the same locality. “The retirement project in Pune sells at a 40% premium compared with usual residential projects in the same area,” said Shashank Paranjape, managing director, Paranjape Schemes. “For instance, if our usual residential project costs Rs. 5,000 per sq. ft, the retirement project costs R6,500-7000 per sq. ft in the same area because there is dearth of such projects.”

Another example is Tata Housing Development Co Ltd’s township in Bangalore. While the usual residential houses cost Rs. 3,400 per sq. ft, the senior living units cost Rs. 3,950 per sq. ft.

Generally, developers sign an annual contract with residents for maintenance, food and security services. The annual maintenance cost typically varies between Rs. 15,000 and Rs. 60,000. Here, the problem is that even if you don’t need specific services, you would have to pay the annual maintenance as it has a flat charging system.

Electricity, food, water and other services are charged based on consumption.

No guarantee of hospital services: Thou–gh the projects provide medical facility, they desist from taking any responsibility.
Rajeeb Dash, marketing head, Tata Housing, which has a tie-up with Apollo Hospitals, said, “The medical services will be provided by Apollo Hospitals, but Tata Housing doesn’t take any guarantee of the hospital services.”

In other words, if you are not happy with the services of a particular hospital but your project has a tie-up with that hospital itself, you are not left with much choice. Typically, a single project has a tie-up with at least one hospital, so your choice becomes limited in that sense.

What should you do?

To get an idea of the concept and whether it suits you, you can start with renting the space. Anil Rego, a Bangalore-based financial planner, said, “As you will be spending around 10-20 years in the retirement home, go slow on the buying process. You can rent it out first to get a feel of it.”

And never look at it as an investment. Surya Bhatia, a Delhi-based financial planner, said, “You can’t look at a retirement home as an asset class for investment as it is a concept focusing on comfort.”

If you get a project where the services are to your liking, you may want to shell out extra for the comfort. But make sure they are all worth it.

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