Housing Decisions: A Guide for Bereaved Families
Decisions about housing are particularly complex, especially when they follow a loss, as they present a dual challenge: emotional and financial
Some families may want to start fresh in a new place as they cope with change. Others may prefer to preserve their familiar home, memories, and the sense of security it provides. Alongside these emotional considerations, essential practical factors also arise: Is the size of the current home still suitable for the family's new situation? Are the maintenance and upkeep costs financially manageable? Does living in the current location allow proximity to our support network? Is there good access to the medical, educational, and community services the family needs?
Before deciding: Assessing the financial situation
Before making any housing decision - whether to stay, move, or invest - it's important to conduct a thorough and honest assessment of the family's new financial situation.
Data to collect:
Available equity: It's important to check how much liquid capital you have that can be used within a month or two.
Monthly income: Make sure to determine your new monthly income, including benefits, salaries and support.
Fixed expenses: It is recommended to check if you have existing loans and monthly obligations.
What to do with the data you collected?
It is recommended to determine the maximum monthly amount you can spend on housing (mortgage or rent + property tax + building committee fees). These expenses should not exceed approximately 40% of your monthly income. It's important to leave room for daily living and unexpected expenses.
Next step: Mapping housing options
When you have a clear picture of your financial situation and capabilities, it's time to consider which option best suits your family. Each option has its advantages and disadvantages, and what works for one family may not necessarily suit another.
To make it easier for you, let's map out the different options and when each is appropriate:
Staying in the current home
- When you want to preserve the familiar and comforting environment, existing habits, and memories.
- When the size and location of the home still fit the new family situation.
- When there is strong community support and a social network in the area.
- When maintenance costs are suitable for the financial situation.
Purchasing a new home
- When there is a desire to start fresh in a new place.
- When the current home is unsuitable in terms of size, location, or costs.
- When you want to move closer to family for support.
- When you have the financial ability to afford the expense.
Investing in real estate
- When you have a sufficient equity.
- When you need to create an additional, steady monthly income source.
- When you prefer to stay in your current residence but don't want to miss out on an income-generating investment and a future asset for your children.
- When you are willing to manage a property you own, including tenants, maintenance, and more.
Costs to be aware of
After choosing a direction, it's important to understand the costs involved in each decision - especially if it involves purchasing a property. If you choose to stay in the same place, the costs will likely remain the same, but if the direction is to purchase real estate, it's important to remember that various significant costs are expected in addition to the price of the property itself:
Housing benefits for bereaved families
It's important to remember that every bereaved family has special housing benefits that can also influence decisions, such as assistance with sheltered housing for the elderly, a loan and one-time grant for purchasing a first home, and more.
See detailed information on the various benefits on the department's website - for a full breakdown, it is recommended to visit the relevant benefits pages or contact the department.
Tips for making the right decision
After mapping out the existing housing options and having an estimate of the expected costs, it's time to decide what suits your family and move forward with the plan. Here are some practical tips to help you make the right decision at the right pace:
Take your time: It's not advisable to make hasty decisions. Housing decisions are significant and have long-term impacts. Give yourself time to process the change and understand what truly suits your family.
Involve your support network: It's a good idea to consult with family members, friends, and professionals. Sometimes an outside perspective can help you see angles you have not considered.
Explore multiple options: If you're considering moving, it's worth visiting several places and not deciding after seeing the first one. Even if you decide to stay, it's worth checking the costs of such a move to ensure the decision is the right one.
Calculate costs beyond the property price or renovation: As mentioned, if you decide to purchase a home, it's important to prepare a detailed and updated financial plan with expected expenses beyond the property's price and check if the overall situation allows for it. If you decide to renovate, remember that there will always be unexpected expenses beyond the planned amount.
Plan for the long term: It's recommended to think not only about the current situation but also about what might change in the coming years - different needs of all family members, financial capabilities, and health conditions.
An informed decision for the future
Housing decisions are among the most significant in life, and after a loss, they become especially complex - mainly because they require balancing emotional considerations with new practical needs.
It's important to carefully consider your steps and not make decisions under pressure or solely based on emotions. A proper balance between emotional needs and practical and financial considerations will lead to a decision that suits your family in the long term. The goal is to find a solution that provides you with security, comfort and peace of mind.
This article is based on a lecture given by Shahar Werner, a real estate investment expert, as part of the "Alumot Or" project. For more information and additional practical advice, you can watch the full video.