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Boomers Plan to Retire in Style
By Tony Wong, TorontoStar
February 19, 2004
Instead of downsizing their homes as they near retirement, some baby boomers are choosing instead to upsize their living quarters, or move to more expensive properties to live out their golden years in style, says a study.
The first wave of the baby-boom generation is changing the pattern for retirement, says the report by ReMax Ontario Atlantic Canada released yesterday.
"These people want it all," said Pamela Alexander, CEO of ReMax, in an interview. "They want to look good, feel good and live in conditions that are comfortable and luxurious."
ReMax couldn't quantify how common upsizing is, but said it is more prevalent now than it ever was in past.
ReMax says several factors have influenced the retirement decisions of baby boomers — people born between 1946 and 1964 — compared with their predecessors. This includes the accumulation of significant wealth through stock markets and through high-paying jobs, inheritances and being healthier and more active over-all.
The oldest baby boomer is now 58, the youngest 40.
"In the old days, you'd retire, grandma would bake cookies for the children and grandpa would make the wooden toys," said Alexander. "That's not quite the way it works today."
While many boomers are downsizing, others are choosing to retire in their dream home, said Alexander.
"They may have inherited money and decided to live life to the fullest. It's not simply something to give to the children. I think years ago it would have been unheard of to retire and move to Rosedale and find your dream home with your dream kitchen. But some people are saying, why not?"
With low interest rates, some boomers are taking on a second mortgage for a vacation home or a bigger home.
According to Statistics Canada, 39 per cent of Canadians between the ages of 55 and 64, a category that includes older boomers, had a mortgage in 2001, up 4 percentage points from 1999.
"There isn't that same generational fear of debt because they had a good equity base to start with," said Alexander.
Stella Quenneville, 50, has already put her 1,300 square foot Etobicoke home on the market in the hopes of buying a bigger, newer home in Brampton.
"At this point, I want all the bells and whistles," said Quenneville, a machine technician, in an interview.
After raising three children in the tiny home, Quenneville says her dream has been to live in something bigger.
"It's not to be grand or to show off, but we've dreamt about this for so long. When the kids were growing up, it was all about school clothes and new running shoes or getting the car fixed. This is for us, and it's also about leaving something nice for the kids when we go."
First on the list of amenities for Quenneville is a dishwasher.
"I was the dishwasher in the house, so even if I don't need one now, I'm buying one just so that I can look at it," she says, laughing.
ReMax said retirement living also has changed because of new options that weren't available in the past — such as fractional ownership, which allows you to purchase a share of a luxury vacation home, and reverse mortgages, which allow seniors to free up money from their home to use as they wish.
There are also a variety of housing options on the market, from gated communities to vacation properties overseas to golf and ski communities. The gated community, common in the United States, hasn't been as popular in Canada.
"I think the concerns over crime and privacy in the United States don't exist as much in Canada," said Alexander. Instead, downtown urban areas remain popular for retirement.
For boomers who do downsize, it may be to a smaller home with luxurious finishes in an upscale neighbourhood. That accounts for the popularity of condominiums near Bloor St. and Yorkville Ave. areas, said
ReMax.
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