Yes, it's time to consider the options. What would happen if one of the couple took ill and could no longer handle stairs in the couse? How close are they to health care services? Is a car required for transportation? Is the house still affordable on their income? All of these questions and more have to be looked at in a dispassionate way. "Just wanting to live in their home" may no longer be an option. What are their alternatives?

Lest you think I am heartless, my parents went through this exercise last fall. My mother could no longer handle the stairs in their home. Within three months they sold their home and moved into a retirement home, where they have a much smaller accommodation, but have a lot less stress. Meals are taken care of. They sold their car and saves $5,000/year. As their banker said, "You an take a lot of taxis for $5,000".

The answer to your question may be to start making some informed choices before a crisis happens.

Seeler, how much did their taxes actually increase? $2,000 more?

I think it's in the best interest for most of the elderly to stay in their own homes as long as possible. Studies show that with good support systems in place that they thrive longer.

I remember being taught in school that it is only 15-20% of the elderly that require nursing home care. Has that changed I wonder?

DKS - these people are healthy, younger seniors.  They live ten minutes from the hospital.  They have their own car and are 1/2 block from the bus line, which would get them to the mall in 15 minutes.  They do almost all their yard work and minor house repairs, and can hire someone to do the rest.   They are well aware of the fact that the time will come when one or both of them will be better off in a seniors apartment, but they hope that is a few years (maybe something like 5-10 years) off.  They know people 15 or 20 years older than they are who still live in their own homes.   The only thing that might drive them out would be skyrocketing taxes due to increased assessments on their property for improvements to the area that they neither wanted or will use.  

Does this seem right and fair to you?   Might there be a better way for the city to assess taxes on a property that has not been upgraded other than regular maintenance, has been owned for decades, and is owner occupied?

When Ontario went to a new assessment scheme af few years ago, there were dire predictions of seniors losing their houses. Guess what? It never happened. No one (and no senior) lost their home. It's not a matter of "fairness" other than someone has to pay. In Ontario it's development charges levied by the municipality. It may be other things in toher jurisdictions.  Is it fair? In the grand scheme of things, yes. On the micro scale, it depends. Are they taking advantage of the improvements? Are they driving on the roads? Walking in the parks? Using the new facilities? Then yes, everyone shares the cost. That's how the taxation system works.

Waterfall, there was a big jump last year - I'm not sure how much.   They haven't received their bill yet for this year but they expect it to jump as much again.    They are worried.   Each year it gets harder - but property values in their area are increasing much faster than inflation.

The city says that they are concerned about people in these situations.  What are some creative solutions to keeping property taxes from jumping.  

Another thing - although this is a settled neighbourhood, it is not a disadvantaged area or a slum.  It is not slated for urban renewal, or anything like that.  Good, solid little homes on pleasant, tree lined streets, in a nice neighbourhood.   They should last for many years yet.

I don't know how anyone can state at any time that 'no one lost their home'.   How would anybody outside the family know when a person looked at their financial situation, realized that property taxes had jumped far more than the general inflation rate that they had budgeted for, and that they had better sell their home or cut way, way back on things like groceries, hobbys, coffee with the gang at the mall, and then made the private and painful decision to sell now and move into a small apartment in another part of town.

Don't patronize me - I know that taxes pay for services.  But many seniors don't play soccer or baseball, they don't skate in the arenas.  Tickets to hockey games and sporting events are beyond their budgets, and they don't enjoy sitting in a cold arena anyway.   They don't have kids in school.  The little park at the end of the block, and the playground at the elementary school suited them just fine, but they miss the trails through the woods that have been paved over for the new and improved highway and the parking lots.  

Perhaps there are no solutions.  I'm wondering if any municipalities have looked at any.

They have a bungalow? That means they have an almost equal square footage on the basement level as their main floor living area. Maybe some church folks or family could donate some labour and skills to give them an income from a lower level apartment?

One of the interesting things about ministry in a small city is that you learn to watch the signs.People moving before they need to, moving to be closer to family, even relocating are the signs that change is happening, often before it's necessary. I'm not hearing about it in my community, nor from colleagues.

Just because you don't use the services does not exempt you from paying for them. We have a huge new recreation centre being built in my city. Will I ever use it? Probably not. But my taxes will be used to operate it. It's part of the social covenant we have with each other to live together in a community.

[quote[Perhaps there are no solutions.  I'm wondering if any municipalities have looked at any.

 [/quote]

Ask if the municipality uses development levies. That's how many GTA municipalities have funded such improvements.

Some municipalities have zoning bylaws that forbid such conversions.

 That's a tough one, if they are young maybe they could find part-time jobs they enjoy.

I have no idea if there are limits on the amount property taxes can increase from year to year, but they probably vary greater from one municipality to the next.  This wouldn't just affect seniors, it could be hard for anyone who bought a home before the upgrades were planned.  Perhaps the taxes could be altered for areas that have a big increase in value that the increase doesn't have to be paid until the property is sold.  That would help out everyone, not just the seniors.

Unless such changes are made, the couple is probably stuck between the decision of increasing their income, or moving elsewhere.  They don't have to move to a seniors complex, but they might enjoy some of the activities if they did.  They could also move to a condo, where they don't need to worry about the upkeep to the same extent as they do age.  Many seniors are resistant to change from what I've seen, partially because they don't want to admit they are old.  My great grandma was that way, she was probably the oldest person (in her 90s) in a semi-independent senior's home.  She required home care, because it was too independent for her at that time; yet she still complained about the other residents, they were all so old.

Absolutely, this should only be done legally. (city approval, fire department inspection, etc...)

I listened to this problem discussed on a local radio station this morning.  Three possible solutions stand out in my mind:

1/ Since children from all over the city will be bussed to the school, and people will be driving from all parts of the city on the improved streets and highway to participate in events at the sports complex and playing fields, to find a way to spread the increase in taxes over the city - and find someway for areas outside the city limits to pay their share for the use they make of these facilities.

2/ Put a cap of taxes increases for each year, spreading out the increase gradually over  the next ten (or so) years.

3/ Delay the tax increases while the house remains owned and occupied by the person(s) who owned it for some years before taxes started skyrocketing.  Then, when the house is sold at the inflated value, assess the back taxes from the profit the home owner realizes from its sale. 

A combination of one and three seem to be the most fair to me.  

Thank you for your input, but I was hopeing you would concentrate more on how the municipality should handle this problem, rather than putting the burden on the individual owners.

Hi Seeler.  Taxation is always a sore point for many.  Although these seniors may not be using, for example, the services in the rec centre on a regular basis, they probably utilize other services that other people in the community are not, and yet pay for.  As DKS mentions, it's part of being in community.  In all honesty, the community that has sprung up around them sounds wonderful to me but I understand that it might not be for others. 

And, BTW, are they utilizing any of the new roads, sidewalks or streetlights that the developer would have paid to have built?  These initial development costs are not born by the municipalities at the time of building - only for ongoing maintenance...cms

At the end of the day, it comes down to the fact that it takes a certain amount of money to run a municipality.  The trick is to find a way to distribute that bill in as fair a way as possible.  The route that almost all muni's take is to use property value as a means of determining what a person should pay.  There are going to be times when a person will feel they are being treated unfairly, but that will happen no matter how you choose to assess municipal taxes. 

You have offered a few ideas to ease the burden on your friends, but the cost of that will be viewed as unfair to some of the people who have to pay the extra.

It sucks; but it's reality.

I dug out this old thread because of this:

http://www.cbc.ca/news/canada/edmonton/story/2013/04/22/edmonton-seniors...

It sounds like a good solution to me!

In Ontario there is a provincial organization (MPAC) that determines the market value of properties for taxation purposes.  Their assessment can be appealed - which, if your situation was in this province, might be helpful.

In my own municipality - there is a tax relief grant available to those with low income - copied from the website - 

"The City of XYZ offers a $400 tax rebate on annual property taxes for low income seniors and low income persons with disabilities who own and occupy their own home. The rebate is applied to your account to offset property taxes.

I do also find myself in agreement with DKS re taxes being part of our community committment.  When I first moved to my neighbourhood - we had no children, but still paid school taxes.  Most people in our neighbourhood were older - no kids of school age either.  Then we had kids & easy access to a wonderful school - thanks to all those taxes.  Now I'm one of the 'older folk' who no longer has school age kids - but I don't begrudge my tax support for all the families in my neighbourhood who do.   

In my community - in the past few years, our outdoor pool was completely redone to a fantastic new concept and is packed with families constantly  & our arena and library were also refurbished & expanded.  Most of this work was undertaken when there was federal & provincial stimulus grant money - so there was not significant municipal tax burden I think.  I wonder if that factored in to the improvements in your community Seeler? 

I think it is a problematic idea.  In that those who take advantage of it are eating up their biggest asset.  Same problem as those reverse mortgages you see advertised.  Sell your house when it is time to move into assisted living and lose a bunch of the value to a loan so you no longer have it to support yourself.

If people could get a guarantee that they would leave their house only at the end of their life so it is the estate sale that is impacted then maybe it makes sense.

Gord - look at it this way.  A senior couple, perhaps one person has a progressive illness, love their home and want to live in it for as long as possible - realistically about five more years.  They are still enjoying simple comforts, hobbies and activities.  They drive their own car.  By being careful, watching their budget, looking for sales, taking care of their clothes and buying replacements at a second-hand store, they are managing.  They even plan a small vacation trip every now and then. 

Then they are hit with a sudden, unexpected, jump in taxes.  Where will they get that extra $2,000 a year?  By cancelling their trip, by cutting back on their groceries, by dropping an activity they enjoy that keeps them involved and active, by selling their car and staying home (and isolated) more?  Probably a combination of several of these.  Or they can sell their beloved home - maybe realize $150,000.  They move into an apartment at $1,200 a month - $14,400 a year.  Each year their rent goes up by 10%.  In five years their capital is greatly reduced.   

Or they delay payment or their taxes, or take a reverse mortgage.    They continue to enjoy their life-style.  They take their annual trip.  In five years they realize that they can no longer maintain their home so they list it for sale at $160,000.  After paying their back taxes, or their mortgage, how much will they have left?  Will it be more than, equivalent to, or less than if they had sold when the taxes first went up?  If it is more than, or equivalent to, they are ahead.  They have enjoyed five more years in their home and are financially no worse off.

I'm just trying to imagine the scenario.  I don't know.  There are undoubtedly factors I have overlooked. 

Gord, I agree if it's a typical increase in taxes.  It seems as though the couple can't afford the house they bought.

If it's a large jump due to an unexpected increase in property value and services in the area though, then there is also likely a large jump in the market value of the house.  That shouldn't have been money they were already relying on.

I find the interest rate a little concerning though.  It's not very competitive especially considering it looksl ike it will be changed twice(?) a year.  Just going off of memory, I didn't look it up again.