The lease with an option to purchase is becoming more and more popular as the real estate market declines. This is a means for buyers to gain access to an Adult Family Home business that they can end up owning. They can save money along the way by having money accrue toward their down payment. They can start profiting from the Adult Family Home business now instead of having to wait to qualify at a bank, which is becoming increasingly difficult.
Sellers like it because they have a tenant that acts like an owner and pays more monthly than a regular tenant. Good cash flow and peace of mine with the tenant.
This is a win/win for Buyer and Seller.
Friday, August 6, 2010
Saturday, February 27, 2010
Agents Remove Listings
As a result of the Seattle Times article several agents removed their listings from the NWMLS, caving in to the perceived pressure from the article which suggested somehow Real Estate Agents were engaged in "Selling Seniors". This is pure tabloid journalism. If you believe in what you are doing, you do it well, and it is the right thing to do for you client, why would you remove your listings? What are you afraid of? Why would you allow yourself to be cowed by this misrepresentation in the Seattle Times of most of the Adult Family Homes in the market? Yes there are a few AFH's that need to be shut down. Those are the exceptions not the rule. How is it illegal or improper to represent the income derived from an Adult Family Home? Why do people allow reporters that apparently are ignorant of the business to define their business? This business is no different than any other that is measured by revenue. Brokerage of Adult Family Homes is just like brokerage of assisted living facilities, nursing facilities and other businesses that provides care to residents, just smaller. Why would the owner of an AFH have any impediment to selling their business? They have worked hard on creating the value in the business - why should they not be able to enjoy the fruits of their labor any less than the owner of a nursing facility or an assisted living facility?
Sunday, January 31, 2010
Real Estate Brokerage issues referenced in Seattle Times Article entitled “Seniors For Sale” by Michael J. Berens, January 31, 2010
Re: Seattle Times Article entitled “Seniors For Sale” by Michael J. Berens
In the January 31, 2010 Seattle Times article by Michael J. Berens entitled “Seniors for Sale”:
Mr. Berens appears to equate the sale of an adult family home businesses to the sale of human chattel. How is the sale of an adult family home business any different from the sale of a nursing home, an assisted living facility or for that matter an apartment building? Of course in the case of any of these different businesses there are residents/tenants. Those tenants/residents pay money in exchange for housing and services rendered. Providing senior care is a business for assisted living facilities, nursing facilities as well as adult family homes. How is this business any different for an adult family home? Is Mr. Berens suggesting that adult family homes should not be able to be sold or that somehow the sale of an adult family home business is unethical or immoral?
Real Estate agents also have a few “bad apples”. We are guilty as charged – as with any industry. That does not mean to say that all agents who work in the sale of adult family homes businesses are bad agents however. Some are, most are not. Most are very conscientious about representation of business and making it clear that you may not in any way “sell” residents. Any agent making the representation that residents somehow come with the business is not behaving correctly.
Whenever any business is sold, one of the primary measures of value is monthly cash flow. This is true of assisted living facilities, nursing homes, apartments as well as adult family homes. The monthly payments of residents or tenants to the owners of any of these properties are what comprise that cash flow. The relative number of residents and their required level of care in the case of any senior care facility is always contemplated. The required level of care for residents directly defines the necessary number of caregivers and the requisite credentials and qualifications of those caregivers. Because the payroll expense of caregivers is usually the largest expense in any health care facility this is an obvious area that is closely evaluated in the purchase of an adult family home as it is in any senior-case facility. From a business perspective this also defines the relative profitability of any senior care facility; nursing home, assisted living facility and adult family home.
When an adult family home business is sold, the buyer must apply for a license and pass all of the regulatory requirements of the Washington State Department of Social and Health Services (DSHS). If the applicant is approved by DSHS, he/she is required to provide written notice to the existing residents or the resident’s families (in the event the residents are mentally disabled). If the AFH business is sold, and there is a new licensee, the residents may choose not to stay in the adult family home. That is their choice and their right. So how is this in any way unethical or immoral? How does this differ in any way from the sale of an assisted living facility or a nursing home?
Seattle Times Article entitled “Seniors For Sale” by Michael J. Berens, January 31, 2010
Re: Seattle Times Article entitled “Seniors For Sale” by Michael J. Berens, January 31, 2010
Seattle Times reporter, Michael J. Berens, has published an imbalanced view of the Adult Family Home segment of the Adult Care Industry in Washington State in the January 31, 2010 article that he authored:
http://seattletimes.nwsource.com/html/seniorsforsale/2010939195_seniors31.html
“Fair & balanced” doesn’t seem to apply in Mr. Beren’s article. In broad strokes he has painted the AFH industry in a very negative light. Without doubt there are examples of abuse in Adult Family Homes in Washington State. These are unfortunate and tragic. These “bad apples” do exist in the Adult Family Home industry just as they do in any industry. However, that does not mean the whole industry is that way. They are in the minority of AFH operators and don’t in any way represent the vast majority of operators who provide excellent care and fulfill a need in the market by providing excellent quality care to their residents. These “bad apples” in AFH’s are not unique to the Adult Family Home segment of the Adult Care industry; nursing homes and assisted living facilities also have their share of abuse cases. Those are equally tragic and unfortunate.
Mr. Berens has withheld most of the positive side of the Adult Family Home providers in his story. One of the few industry references that Mr. Berens cites in his article is Gary Weeks. Mr. Weeks represents the interest of nursing homes, a direct competitor to the Adult Family Home segment of the industry, and is one of the few industry spokespeople cited in the article. Conspicuously absent from the story is any industry spokesperson for the Adult Family Home segment of the Adult Care Industry.
The anguish and concern that is created by such an imbalanced article and the effect it will have on families of existing residents as well as the families of potential residents is difficult to measure. If, after reading this article, your own family member is in an adult family home or you are contemplating the use of an adult family home to provide care to a family member, this article would give you pause and real cause for concern about their safety and welfare if they were in an Adult Family Home. In the vast majority of Adult Family Homes that cause for concern is unfounded. The vast majority of AFH operators provide excellent quality care to their residents.
One of the sad parts of this scenario is that an adult family home is one of the choices that often provides the very best quality of care available. As a result of this article adult family homes will now often be dismissed by many possible residents, or resident’s families, as one of the possible choices for senior care.
The general characterization and perspective provided by Mr. Berens about Adult Family Homes in the article is unfair and imbalanced. The Seattle Times should also report on the “other side” of the story – about the good that adult family homes provide. This would correctly depict the vast majority of adult family homes, but clearly that would not sell as many newspapers as this type of tabloid sensational news that is used in this one-sided perspective on adult family homes in this article.
Seattle Times reporter, Michael J. Berens, has published an imbalanced view of the Adult Family Home segment of the Adult Care Industry in Washington State in the January 31, 2010 article that he authored:
http://seattletimes.nwsource.com/html/seniorsforsale/2010939195_seniors31.html
“Fair & balanced” doesn’t seem to apply in Mr. Beren’s article. In broad strokes he has painted the AFH industry in a very negative light. Without doubt there are examples of abuse in Adult Family Homes in Washington State. These are unfortunate and tragic. These “bad apples” do exist in the Adult Family Home industry just as they do in any industry. However, that does not mean the whole industry is that way. They are in the minority of AFH operators and don’t in any way represent the vast majority of operators who provide excellent care and fulfill a need in the market by providing excellent quality care to their residents. These “bad apples” in AFH’s are not unique to the Adult Family Home segment of the Adult Care industry; nursing homes and assisted living facilities also have their share of abuse cases. Those are equally tragic and unfortunate.
Mr. Berens has withheld most of the positive side of the Adult Family Home providers in his story. One of the few industry references that Mr. Berens cites in his article is Gary Weeks. Mr. Weeks represents the interest of nursing homes, a direct competitor to the Adult Family Home segment of the industry, and is one of the few industry spokespeople cited in the article. Conspicuously absent from the story is any industry spokesperson for the Adult Family Home segment of the Adult Care Industry.
The anguish and concern that is created by such an imbalanced article and the effect it will have on families of existing residents as well as the families of potential residents is difficult to measure. If, after reading this article, your own family member is in an adult family home or you are contemplating the use of an adult family home to provide care to a family member, this article would give you pause and real cause for concern about their safety and welfare if they were in an Adult Family Home. In the vast majority of Adult Family Homes that cause for concern is unfounded. The vast majority of AFH operators provide excellent quality care to their residents.
One of the sad parts of this scenario is that an adult family home is one of the choices that often provides the very best quality of care available. As a result of this article adult family homes will now often be dismissed by many possible residents, or resident’s families, as one of the possible choices for senior care.
The general characterization and perspective provided by Mr. Berens about Adult Family Homes in the article is unfair and imbalanced. The Seattle Times should also report on the “other side” of the story – about the good that adult family homes provide. This would correctly depict the vast majority of adult family homes, but clearly that would not sell as many newspapers as this type of tabloid sensational news that is used in this one-sided perspective on adult family homes in this article.
Friday, January 1, 2010
Lease with an option to purchase
This is going to be the most prevalent way to get your AFH sold in this market.
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