When Someone Goes Into Care – How To Decide Whether To Sell Or Rent Their Property?

If you are appointed as a Lay Attorney or Deputy for a person’s property and financial affairs, you may find yourself having to consider whether to sell or rent their property. The person should always be consulted as much as is practicable on what they want to happen to their property, however, there may be a few things you wish to consider before making a decision.

In our previous blog, we followed the case of Pam who had just moved into residential care. Pam has now been in care for a few months and her Attorney/Deputies are now wondering what do to with Pam’s property.

Is Pam likely to return home in the future?

Firstly, you might want to consider whether it is likely that Pam could return home with the right support. If it is likely that Pam may return home in the future, then renting may be a better option as it allows the property to generate an income for Pam instead of remaining unoccupied.

However, if it is clear that Pam is going to have to remain in long-term care, it may be beneficial to sell the property in order to fund Pam’s ongoing care fees and anything else she might require. It would also mean that Pam would save money by not having to fund the upkeep of the property.

What is the current position regarding Pam’s available assets?

You may also wish to consider the current state of Pam’s assets. Does she have savings accounts and investments with sufficient cash balances to support her needs or does she own other properties, which they rent out? If so, it may be better to rent out the property to increase the income further.

Does Pam have very few available liquid assets or does she have outstanding debts such as care fees? If this is the case, selling the property may be the best option in order to ensure care fees can be paid and any other expenses. If there is a large balance of cash remaining, this can always be placed into a suitable cash deposit account in order to earn Pam some interest.

Selling or renting Pam’s property after she has gone into care – what are the positives and negatives of each option?

Positives and negatives of renting out Pam’s property

Renting out Pam’s property gives them the option of returning home should they be able to. It also provides a regular monthly income.

Renting out Pam’s property will incur management fees, which may not be affordable over the long term for Pam. You also need to consider what would happen if a new tenant could not be found for a period or if a tenant refuses to leave and you have to start eviction proceedings. This could be very costly for Pam and so renting should only be considered if Pam has significant assets alongside their property.

Positives and negatives of selling Pam’s property

Selling Pam’s property could free up much-needed capital funds, as well as allow any accrued care fees or debts to be paid off.

However, selling Pam’s property will also incur fees including conveyancing fees. It also means that Pam is not going to be able to return home and will be remaining in long-term care so it is essential to ensure that it is necessary for them to remain in long-term care before the property is sold.

No matter what you decide, your decision must always be in the best interests of Pam. Our next blog discusses the considerations of selling a property as an Attorney.