On an early spring day, 92-year-old Liu Xiaomao sits in the sunny courtyard of an old people's home in Shanghai's Putuo district, chatting with her 72-year-old roommate.

This is Liu's third year in the retirement home since she signed an agreement with the head, Fang Quanzhen (not his real name), that the house would look after her in her autumn years in exchange for her 30-square-meter apartment. Legal ownership of the apartment will pass to Fang upon Liu's death.

Liu has no spouse, no children nor any known relatives. She used to work in a textile factory and enjoyed a collective life with her fellow workers, but when she retired she found she had to face many things on her own.

"I quite enjoy life here, as I have made friends with my roommates and the nurses, and Fang is so nice to me - he's like a son," said Liu.

Fang admitted that he was initially reluctant to sign the agreement because there were no previous cases he could learn from. "We were not sure if there were any regulations that could provide a guide and help us to handle this specific case correctly," said Fang, who, unsure of the legality of the agreement, would only talk if a pseudonym was used.

However, he eventually agreed to help because the elderly lady was in dire need of good care, and the members of her local community committee visited several times to persuade him.

Fang helped Liu to move to the seniors' house and promised that any future expenses incurred would be fully covered.

Liu lives with three other senior citizens, all aged 70 and over, in a room measuring 20 sq m, and equipped with an air conditioner, heating, and a television.

"It feels good to live here because I don't feel lonely, and Fang often takes me back to my old home to visit my old neighbors," said Liu.

Fang said Liu's apartment has been leased rather than sold because it is the only property she owns and is an important part of her memories. The tenants pay rent of 1,500 yuan ($238) a month and the money pays Liu's expenses and medical bills.

Fang said the retirement home does not make any money from the agreement. "Sometimes I pay extra money for Liu's bills, which cannot be covered by the 1,500 yuan," he said, adding that the home will not sell Liu's apartment or use it for other purposes.

"I know she likes to see it often and still regards it as her own home - if it were sold, the bond with her old neighbors and her memories would be severed," said Fang.

Although this alternative to the reverse mortgage plan is working smoothly, Fang said similar arrangements are unlikely to be widely promoted in Shanghai. "Liu's case was rare in Shanghai's houses for seniors. Only elderly people with no relatives are likely to consider exchanging their property for care services," said Fang.

Zhou Dekai (not his real name) has a 67-year-old mother who lives in the same old people's home as Liu. He said he had heard about Liu's agreement with Fang, but did not think his mother would be willing to do the same.

"My sisters and I pay our mother's expenses, and I visit her three times a week. I think I am indeed a son full of filial love, but I don't think it is necessary to sell the apartment for the pension," said Zhou, who didn't want his real name to be used as he feared friends and neighbors would think ill of him for allowing his elderly mother to move into a retirement home. "My two sisters and I are entitled to inherit the apartment, even though it is only 30 sq m in size," he added.

Fang said elderly people without children would usually consider passing on their apartments to nieces or nephews.

"Care institutions are the last parties people would give property to. The tradition that the offspring take care of the parents and inherit their property has been overwhelming in our society for a thousand years and real estate is the most important condition in this social norm," said Fang.

Lack of detailed regulation of this "houses-for-care" plan also has created a backlash against promotion of the services among a large group of elderly people, said Fang.

Every quarter, Fang briefs Liu and community committee members about the rental income of the apartment and how the money is used to ensure that the finances are transparent.

"After all, it's about handling property and that is always a sensitive and complicated thing, if the regulations and policies that guide houses-for-care services can be introduced, then we may have a chance of getting more people involved," said Fang.

wuyiyao@chinadaily.com.cn

(China Daily 04/11/2012 page6)