Throughout our lives most homeowners have lived in several properties. They often start renting, maybe own a condo or townhouse, and then move to a larger family home. A larger home allows some to raise children, enjoy the company of pets, entertain on the backyard deck, watch their children play in the yard and enjoy the dream of home ownership.
Once the children move on, it is often in the financial plans to sell the larger family home, extract some equity, and move to something smaller that is easier to manage. This is called the Downsize. The plan is to sell the larger family home for more money than the cost of the smaller home and bank the difference in market price using the funds as part of their financial future plans.
A single level home is called a Bungalow here in Calgary and it is a sought-after home for those downsizing. The problem is that financially, downsizing and extracting equity is a myth. I have had the misfortune of dispelling this myth to many families as I assisted with their downsize plans in my former profession as a realtor.
Why a bungalow?
As people age, they often prefer to avoid stairs and see the benefits of consolidating their household needs to the main floor. Moving to a bungalow is about independence. It is about not having to go through the moving process again for as long as possible. People often told me that downsizing to a bungalow it is their last move or their last move until they are forced into a retirement home. Many homeowners are surprised with they see the market value of bungalows in Calgary.
Bungalow numbers are declining
Older existing single level homes are regularly taken down and replaced with multi-level semi-attached duplexes especially in inner city communities. There are few, if any, bungalows built in newer communities these days.
Bungalows will have a larger footprint than a two story home of equal size. There is little to no incentive for developers to build a decent size bungalow on a large lot when they could build 2 multi-level homes on the same size of property and increase their return on investment.
I wish I could provide detailed data to show you the number of single level homes available over time but neither the City of Calgary nor the Province of Alberta provides this information. The available information only focuses on single family vs multi family statistics. To see if for yourself take a drive around some local neighbourhoods.
There aren’t many single level townhouse or semi-detached options
Just like the demise of the construction of single level homes there are few single level townhome or semi-detached properties built in Calgary these days except for the luxury market. If you have $1 Million to spend on your ‘downsized’ townhouse bungalow there are options, but many homeowners were not considering spending 7 figures on a downsized property that meets their needs. There are existing single level properties in more mature neighbourhoods, but past clients found the pricing higher and homes older than they expected. It made the prospect of selling their current home less attractive.
The Apartment Option
Many homeowners that are ‘downsizing’ are not considering an apartment option due to pet restrictions; no room for hobbies such as music, a wood shop or gardening or just the change to daily life. It becomes the only choice sometimes due to cost. Sometimes people begrudgingly make the move and other times choose to remain in their existing homes instead.
Some people do look forward to an apartment option when they consider downsizing, but they are often surprised at the small sizes available and lack of options in their current communities. There are a large number of compact units but they are often not what people often expect when it comes to size, initial cost, and ongoing condo fees. When considering most condo fees start at approximately $0.50 per sq ft then that 1200 sq ft condo can easily cost over $600 a month in condo fees.
One of the main pros for the apartment choice was the lock and leave lifestyle for snowbirds, those people that spent their winters in warmer climates. Other challenges homeowners had transitioning from a single family home to an apartment include:
Condos and Pets
Pets are family. Most condos, apartments and townhouse complexes alike in Calgary, restrict pets. There are some that allow pets but finding one that allows dogs over 20 pounds is often a big challenge. Unless people are forced into a decision due to other circumstances, I have had most past clients tell me they will stay where they are for a while longer rather than have to give up a pet to make a move. I once found a great single level detached townhouse for a client in a community close to where she was selling her family home. She had a 12-year-old larger dog that spent his days going for walks and napping on her sofa. The complex denied the pet approval due to the dog size and she didn’t purchase the unit.
Lifestyle and Condo Rules
Condo rules are unique to each complex, but there are some general trends such as the pet restrictions mentioned, rules about what is allowed on decks and gardens, what can be parked or stored in the parkade, and noise limitations. Some people love rules and all that makes them quite content. Other people really don’t enjoy being told what to do. In the end it depends on the tone of each condo board and how an individual complex is run and how that fits with each potential owner.
A unique challenge recently was a change at the provincial level which requires all condos to remove age restrictions other than those for age 55+. There will no longer be age 18+ complexes.
The rules come down to lifestyle and how people had planned to spend their time as they retire. If your plan was to tinker in the woodshop, build a garden, foster some dogs, or play an instrument then an apartment is probably not the ideal choice. It is about happiness after all and quality of life.
The specific Calgary planning process
This part is a little political so skip this section if necessary. In late 2021 I watched Calgary Council debate the development direction for this City and the ‘Guidebook for Great Communities’. This document has now been renamed the ‘Guide for Local Area Planning‘ if you want to find it.
Everything about it is a push towards density and multi-family housing and I just didn’t see any thought to the need for bungalows or single level homes in the process.
In the push for higher density living, it is forgotten that there are many that can realize an improved quality of life living on a single level such as those with various medical or mobility issues. The ongoing challenge of appropriate housing options will just increase as less single level supply makes it to market. It appears the conversation of types of housing was ignored and the conversation focused more on density than on quality of life.
So why is this an issue?
Well, there are more people entering retirement age in the coming years than before as the baby boomers retire. From statscan:
The proportion of seniors (aged 65 and over) in the population would increase from 17.2% in 2018 to between 21.4% (slow-aging (SA) scenario) and 29.5% (fast-aging (FA) scenario) in 2068. The increase in the share of seniors would be most pronounced between 2018 and 2030, a period during which all members of the baby boom would reach age 65 and over.
This is no small number. As developers keep building more skinny townhouses across 3 levels and narrow multi level homes on narrow lots I wonder where all those that wish to age in place will go. The current environment may push some families into avoidable financial hardship, jeopardize safety by remaining in a home with mobility hazards or force them to move to a different city with more available housing options but further away from the support of family. It all seems so predictable and requires active planning consideration. Unfortunately I don’t think it’s even on the radar at least locally.
The supply and demand challenge around single level homes will only grow.
I may have just burst the downsizing myth for you however it is better to find out sooner than later that there may not be an opportunity to cash out on the equity in your current home as you planned. You may opt to instead modify your existing home as needs arise or adjust your financial plans so you can afford to move to a single level home that meets your needs when you sell your existing home.
May you always find your way home.