We research, you save.
Got Questions On Rates? (855) 610-2972

Do you know which housing markets have fully recovered value lost in the last recession... and which ones haven't?

‘Granny pods' can be an alternative to nursing homes

If there's one thing worse than sending an elderly loved one to live in a nursing home, it could be having them live in your house. With millions of baby boomers expected to need assisted living in the near future, some homebuilders are bringing creative housing solutions to the market.

Small modular units, dubbed "granny pods," can serve as an alternative to a nursing home. Compact, specifically designed to meet medical needs and relatively inexpensive compared to living in a facility, they bring assisted living right into your backyard.

Bringing care closer to home

The average age of admission to a nursing home is 79, according to the American Association of Homes and Services for the Aging. Millions of baby boomers will start reaching this age in less than 15 years.

In 2011, Nationwide Homes launched the Care Cottage, a 14-foot-by-44-foot modular home specifically designed as way to bring assisted living closer to home. Dan Goodwin, Nationwide vice president of sales and marketing for the Martinsville, Va., company, says small dwellings, which can be either temporary or permanent, are a solution that offers both care and closeness for loved ones without the loss of privacy for the family.

"What we found was that the preferred place for people to be is not in institutions but with family members. But people also want their own space," he says.

A number of other units have recently arrived on the market. MEDCottage, a 288-square-foot modular unit created by N2Care of Blacksburg, Va., is designed to serve as a long-term care housing alternative to nursing homes. The 12-foot-by-24-foot unit features a kitchen with a small refrigerator and microwave. The unit also features a medication dispenser and a handicapped-accessible bathroom.

Since the risk of falling is one of the main reasons people go into nursing homes, MEDCottage has defenses. They include a floor-mounted camera that monitors up to 12 inches off the ground, safety lighting and a lift that can carry the resident to the bathroom. MEDCottage also uses robotic features that can monitor vital signs and everything from blood pressure to glucose levels.

"It's not necessarily made to replace nursing homes but gives people an option who want their loved one close by. It offers a lot more than a spare room," says N2Care CEO and founder Ken Dupin.

A cost-effective alternative

Due to their modular design, most assisted living units can be installed as temporary structures. When they are no longer needed, they can be sold back to the distributor, allowing the homeowner to recoup a part of the costs.

According to the Genworth 2012 Cost of Care Survey, the national median monthly rate of an assisted living facility is $3,300 per month, or $39,600 per year. For a semiprivate room in a nursing home, the median rate is $73,000 per year.

Dupin says the retail price of the MEDCottage averages $85,000, meaning it can usually pay for itself within a year and a half.

Henry Racki is the CEO for the RockFall Company in Rockfall, Conn., which builds modular units called PALS -- Practical Assisted Living Solutions. He says buyers have been homeowners in their 60s who are purchasing PALS to care for parents in their 80s. Many of these homeowners are investing in the units with plans to use them themselves later in life.

Other buyers find PALS are well-suited not just for seniors needing specialized care, but also for disabled individuals who otherwise would need institutional housing. An "a la carte" menu means consumers can customize a PALS unit to meet their exact needs.

"We can design it to almost any level of medical needs. We've found that disabled people can now stay at home because they can have cost-effective facilities," says Racki.

Local codes could create barriers

While modular designs offer affordability, portability and the option to keep loved ones close to home, they are banned by zoning regulations in many communities. Dupin says that in 2010, N2Care was successful in getting the Virginia General Assembly to pass HB1307, a law that supersedes local zoning ordinances and allows families to put modular medical dwellings on a property with a doctor's order.

Four other states, including New York and California, eventually followed suit with similar legislation. As a wave of baby boomers start needing assisted living care in the coming years, Dupin believes more codes will be changed to allow such units.

"It varies from state to state and the code. I think more states will follow suit in the future. You couldn't build enough bricks-and-mortar facilities in the next 10 years. We're going to need creative options, and this is one of them," he says.

Related articles :

More help from HSH.com

  • Home price recovery index: Which metros have improved the most, least?

    Have home prices in your area fully recovered from the declines suffered during the Great Recession, or are they still struggling to make it back to the peak reached before the crisis?
  • 10 metros where a home costs about $1,000/month

    HSH.com identifies 10 metro areas where you can afford the principal, interest, taxes and insurance payments on a median-priced home for only around $1,000 per month.
  • HAMP versus HARP: Which is right for you?

    Making Home Affordable offers two plans for troubled homeowners. The Home Affordable Refinance Program, or HARP, allows underwater homeowners to refinance if they can find a mortgage with a better interest rate.
  • The salary you must earn to buy a home in the 50 largest metros

    Here’s how much salary you would need to earn in order to afford the median-priced home in your metro area.
  • HSH.com on the latest move by the Federal Reserve

    The Federal Reserve concluded a meeting today, leaving the federal funds rate unchanged at a range of 2.25% to 2.5%, but continued to express patience and flexibility in its current approach to monetary policy.