Dementia and Property, a Personal Overview

I thought I would write about this difficult subject from personal experience. I live in a 3 generational home with my mother who was diagnosed 3 years ago with mixed Alzheimer’s and Vascular Dementia but had signs of the disease years before this. Getting a diagnosis in the UK is very difficult but that is another story!!

With more and more people suffering from this horrible disease and the need in the later stages of having to place them in care homes planning finances for this care is a priority. Remember the government will only step in and help when the persons assets reach £24,000. You may think that you have enough assets/pension/savings etc to manage but you must remember with a Care Home costing approx. £1,000 a week (£52,000 pa) the money goes very quickly. With more complex needs this amount can double.

Absolutely Crucial (Cannot stress this enough)

This is not just property related but the carer must get Power of Attorney (POA) for both Financial and Property Affairs and Health and Welfare BEFORE the person loses mental capacity, preferably before they are diagnosed. This is done by both of you attending a solicitor and signing the relevant documents which are registered with the Office of the Public Guardian. This is a good article from the Alzheimer’s Society to go into further details. Asking your local solicitor in the first instance is easy and usually the first consultation is free.

Without the POA you will not be able to make decisions about the persons property and assets. If it is your partner/spouse it is slightly easier but if you are looking after a parent or relative and you have not got this it is basically a nightmare to talk to banks, mortgage companies, pension providers……the list is endless. They just will not talk to you.

I was lucky as my mother was agreeable to this many years ago but it can be an awkward conversation especially with older parents agreeing to their children having POA. My mother has no idea of the value of money now and I run her bank accounts and pay all her bills (this is a lady who was a Director of her own Limited Company and ran a Brass Band that toured all over the country for her husband!)

We asked our good friends at the solicitors Bartons to comment on this in more detail and they kindly wrote the following:

“Paying for care in old age is often a hotly debated topic in the United Kingdom where we have the National Health Service.  However, as it stands today care remains expensive if you have assets to support your local council with and happen to require more intensive support for conditions such as Alzheimer’s. 

Forward planning and professional advice is essential to protect family wealth whilst covering one’s health needs appropriately in view of both the privilege and challenge that come with advancing years.

Should you have to sell your home to pay for care costs it is essential to have a lasting power of attorney (‘LPA’) in place which will allow your attorneys to enter into the transaction to sell your home on your behalf.  This is because you will not be able to enter into the contract for sale if it can not be ascertained that you have the mental capacity to understand what the contractual consequences are of the transaction.  Not having an LPA in place will frustrate the sale and will prove more costly and time consuming to rectify by having to go through the process of Deputyship to appoint third parties to sell your home when you have lost capacity to do it yourself.

Attorneys must act in your best interest at all times under the principles enforced by the Mental Capacity Act 2005 and there are options to discuss with your trusted advisors over types of decisions that can be made individually or unanimously by your Attorneys so that your individual wishes will be upheld and respected.  Protections are in place at the Office of the Public Guardian to ensure the risks of abuse of a power of attorney are managed notwithstanding the fact that a Donor should trust his or her Attorneys before entering into the arrangement.

Putting in place a Lasting Power of Attorney must be done when the Donor is in good health and when they can understand the powerful effects of the document.  When there are signs of decline in the Donor’s mental capacity it may already be too late to establish an LPA.  The Author recommends that everyone over the age of 50 considers putting in place LPAs for Health & Welfare and Property and Financial Affairs as part of a robust future planning and preparation process in liaison with suitably qualified and experienced legal advisors.”

Property Assets

If you need to sell a property to cover care costs you must remember it does take quite a long time to sell a property approx. 6 months from putting the property on the market. If there is not enough income to cover the costs of the care home some of them will defer payment or you can approach your local council and they may step in but will want the money back. If you live in a  multi generational home as we do it is slightly more complicated as it is only the percentage of the property owned by the person needing care looked at and they cannot force the property to be sold as other people live there.

Selling the property and investing in a buy to Let or Holiday Home rental

We have quite a few buyers on our books looking for such property. This usually happens when the property the person owns is not suitable for letting so has to be sold. Be aware as the costs of selling and buying are expensive. Do your homework if you are looking at holiday lets as running costs are expensive and you need to be sure what your net income would be, don’t get swayed by the gross income. We did a helpful article about holiday lets which you can see here

At Home Care

Choosing a future proof house as you downsize is another way of avoiding/delaying going into a Care Home. We sell to a lot of buyers who look for large ground floor accommodation so rooms can be converted into bedrooms and easily accessible bathroom/Wet rooms. Rooms on the ground floor with views of and easy access to the garden are the best. Whilst a bedroom upstairs can be used by live in carers. Live in Careers are still eye wateringly expensive but it does mean you are living in your own home.

The design and layout of your house should be simple and familiar as Dementia sufferers need routine and to know where everything is any change can have a detrimental effect. However, if you are living with a sufferer be prepared to look in strange places for lost items. In my house its usually the freezer for house keys, cooking pans, or anything to be honest.

Renting the house to cover costs.

This is a route that many people go for if they need to top up income for Care Home fees and to try  and preserve the asset. The vast majority are let unfurnished so you have to be certain that the person is not going to want to come back as the furniture and all possession need to be cleared. You will also have to check that the property is legal to be let with Electrical and Gas safety checks as well as having an Energy Performance rating above E (changes to C in 2025). Before going down this route check with a reputable Letting agent to get an idea of what you may have to do and an idea of letting income.

Forward Planning

Planning ahead for old age is always a good thing and if you are living in a large house with rooms you don’t use it may be the time to think about downsizing to a property that is somewhat future proof. Caroline and I often visit people who are living in their family home where they have brought up their children and it has so many memories for them they are loath to leave. However when we talk to them how many rooms they actually use on a daily basis it sometimes becomes apparent that they have not been in a particular bedroom for months and their big dining room table has not been full since last Christmas.

By downsizing you often release sizeable cash reserves that can be used for that trip of a lifetime that you always promised yourself, invested for future care or gifted to children to mitigate, at least some, of their eventually Inheritance Tax.

We always say to people Move When You Can Not When You Have To as you won’t be rushed into hasty decisions.

Some contacts and websites that I have found useful:

Alzheimers Society https://www.alzheimers.org.uk/

Totnes Caring https://www.totnescaring.org.uk/ Amazing organisation who also run the Memory Café in Totnes which is a great hit with Mum.

Filo Project https://www.thefiloproject.co.uk/ This isa n organistaion that picks clients up and takes the to one of their employee’s homes to have lunch with people of their own age.

Independent Living Centre, Newton Abbot https://www.independentlivingcentre.org.uk/ This is run by Devon County Council and is useful for aids and practical advice on day to day living

Herbert Protocol This is useful if a person starts to wander and allows Police in the area  to know details about the person and makes sure they treat it as a priority.

Dementia Clocks By clicking on Dementia Clock s this will take you to Amazon where you can find a large range. These are a sanity saver for the carer as they not only tell the person time date and month but also if it is Morning or Night. This has helped me no end and we have 3 !

I hope you have found this useful and if you would like advice on Downsizing or what type of property you should consider please get in touch. Miles Kevin, Chartsedge. miles@chartsedge.co.uk 01803 505115