“She had credit lines and was living off of them, but the rules changed and she couldn’t [get more credit]. She could have moved, but mom had always said she wanted to stay in her home as long as she could. She loves her property, lives and breathes it,” Korol told the Financial Post
Fortunately for the family, what has been agreed upon is that the younger Korol would become the “committee of person” in case the mother would be incapable of making medical, financial, or legal decisions. Working with a bank, Korol applied a reverse mortgage on their home, which would allow them to earn without evicting his mother from the property.
Korol’s story is an increasingly common occurrence in Toronto and Vancouver—widely considered as the two most expensive real estate markets in Canada—where the opportunity to enjoy hefty profits from luxury and heritage homes is otherwise ignored by their senior citizen owners for various reasons.
This neglect has led to many owners of these premium housing parcels actually living in poverty.
“I’ve seen people who are eating cat food but they own a $1.5 million home. Some of these seniors just don’t have any idea what their home is worth because they bought it so many years ago. Maybe even for as little as a few thousand dollars,” Re/Max Hallmark Batori Group Inc. broker David Batori explained.
senior vice-president Yvonne Ziomecki noted that the Korols’ discussions and future steps should be on the agenda of every family with a potentially lucrative home, especially since any earnings can be used for the medical needs of the aging parents.
“Money is often a big cause of family feuds and falling out in the family. Even if the parents only have two children and it should be straight forward, it’s not always the case. This has to be done when you still have your mental health,” Ziomecki said.
Vancouver local Wayne Korol resided in a heritage home in the west section of the city—which has recently seen average prices for detached homes grow to $1.8 million. Taking care of his dementia-stricken mother has become a 24-hour obligation, and no provision for selling the home has been agreed upon between them before the onset of his mother’s disorder.