A common wish amongst the elderly is that when it comes time to die, they will die in their home: where they can be surrounded by the familiar, and their loved ones. The desire to die in one’s home is often contrasted with the harsh alternative stereotype of moving to a nursing home and dying alone in a cold, clinical, sterile environment. 

An impediment to living out one’s final years at home is often money. The cost of maintaining a home can be substantial, and income in those final years is often limited. Added to this is the cost of facilitating life at home: accessibility renovations and nursing assistance. 

A recent Toronto Star article highlighted an alternative that seemed to work wonderfully for the woman in question. The woman’s family sold her home under a viager agreement. Under this agreement, the women’s home was sold to a third party. However, the woman was allowed to stay in the home for the rest of her life.  

Details of the agreement can vary. In the agreement reported on in the Toronto Star, the woman was paid the purchase price. The buyer became responsible for maintenance of the home. The woman was allowed to stay in the home for the rest of her life. After a rent-free period, the agreement provided that the woman was to pay a fixed rent. In other variations of a viager agreement, the buyer makes a down payment and then a series of payments to the vendor as long as the vendor is alive. 

The concept is not for everyone. The agreement can be particularly complex, having to address all eventualities such as possible renovations to facilitate access, and issues relating to the occupancy of the house. Most buyers would be wary of entering such an agreement, where it is uncertain as to when the buyer would have occupancy.  This may have a negative impact on the selling price. The occupancy condition, however, might not deter all buyers, particularly buyers looking for an investment property. Further, the purchase price is usually discounted to take the nature of the ongoing relationship into account. 

The concept is often contrasted with a reverse mortgage. These are often seen as being less complex and easier to implement. 

Thank you for reading. 

Paul Trudelle