Are you a retired or nearly retired person whose life revolves around the grandkids? Do your friends joke that you've scaled back your career to become a "professional grandparent"? Yet are financial concerns now forcing you to sell the big house that's accommodated so many family gatherings?

If so, you might worry that your need to downsize could put your relationships with grandkids in jeopardy. But with thoughtful planning and flexibility, that needn't be the case, says Sue Johnson, the co-author of "Grandloving: Making Memories with Your Grandchildren."

"Children are like puppy dogs. It doesn't matter where you live. What matters most is what you give them from your heart," Johnson says.

After retiring from full-time careers, she and her husband downsized to a lower-cost area within driving distance of all seven of their grandchildren. There they selected a modest ranch-style house on a creek where the whole family can fish and sail.

"We call this house our grandchild magnet. That's because the grandkids were a huge part of why we moved here and they love to visit," Johnson says.

Originally, the couple's three-bedroom house was a one-story place with just a single bathroom. But to accommodate family gatherings, they built on a second story, adding two more bathrooms and an extra bedroom and doing much of the construction work themselves to save money. Despite the addition, the house is still a tight fit when many family members visit.

"The kids are sleeping on cots or sleeping bags on the floor. But everyone has lots of fun," says Johnson, who co-authors a blog on the art of grand-parenting (www.grandloving.com).

Sue Patton Thoele, a semiretired psychotherapist and author of a number of books on family issues, says that although most grandparents would like to own a home that provides recreational attractions for their offspring, that's not always an affordable option.

"Many of us have tremendous financial concerns we didn't have before the recession," Theole says. "And when you're retired, you don't want to have a big mortgage that strangles you and makes money concerns such a huge stressor. So you've got to work within your means."

She urges grandparents to select a place that's both affordable and well suited to their lifestyle -- noting that children adapt easily to new environments.

Here are a few pointers for homebuyers seeking a property that will serve both their needs and those of the extended family:

-- Question whether you need a big yard.

Kay West, a veteran real estate agent and a past president of the Council of Residential Specialists (www.crs.com), spends as much time as possible with her three grandsons, ages 3, 6 and 10, who live nearby.

As West tells her home-buying clients with grandkids, they don't need a lot of outside space to keep them happy. One good substitute is to buy a home in an area with a park nearby. For example, West chose to live just three blocks from a park with a large and colorful playground set that her grandsons enjoy.

-- Find a location on a quiet street, if possible.

West advises home-buying clients with grandchildren to think of the kids' safety when considering the street on which they plan to live.

"Most families prefer a quiet street if they have a choice. Not only is that better for children and pets but it also means less noise and stress," she says.

Protecting children from road hazards is particularly important if the grandparents are providing care for young children or if the kids live with them full-time. As Johnson notes, the number of grandparents who raise children now numbers over 8 million and is increasing.

-- Seek a home with an extra bedroom or suite.

West also encourages homebuyers with large extended families to shop for a property with an extra bedroom, particularly for those with families separated by distance.

"It's much better to put your family up at your home rather than at a hotel. It's way more relaxed that way. And because no one prefers to share a bathroom, it's great to have a guest suite with its own bathroom," she says.

Even homeowners who live near their grandchildren can benefit from a bedroom the kids can call their own. For instance, West has an extra bedroom with three twin beds and a closet full of toys that her grandsons use during overnight visits.

-- Realize that living in a resort area is optional.

Some home-buying grandparents pick a neighborhood with easy access to a recreational venue, such as an ocean beach or an amusement park. Others move near cities with sightseeing opportunities. They hope such lures will prompt their offspring to visit often.

But Theole says grandparents who plan to move shouldn't select a property based on its tourist attractions. That's because most residential areas offer sufficient leisure activities to keep the kids entertained, and grandparents need to think first about their own lifestyle preferences. In addition, families can create their own fun activities around the house, including crafts and games.

-- Don't worry if you live a distance away.

As Johnson notes, many grandparents can't afford to make a long-distance move to be closer to their grandchildren -- especially if the kids live in an area with high-cost housing. Anyway, there's no guarantee your grown children might not make another move later, should their careers cause them to relocate.

But as Johnson notes, there are many ways to stay connected with grandchildren, even if you live a plane ride away and don't have the funds or good health to travel often. Through the book and blog she co-authors, she provides low-cost strategies for staying in close touch.

"There is a multitude of ways to stay connected long distance. You just have to have the right frame of mind and a big heart," she says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)

Most homeowners reject the idea of renting out their property, even for a short period. They fear damage and nasty complications.

But Mary T. McCall, a long-time real estate broker, says the positives of a temporary rental could outweigh the negatives -- especially if you're convinced that home values are on the upswing in your area.

"This could be a wonderful time to lease, because there are so many good tenants out there now. These are people who -- due to hard times -- had to let go of a house through foreclosure or a short sale. They're just renting until they get their credit back," says McCall, president-elect of the Council of Residential Specialists (www.crs.com).

One group who could benefit from renting out their homes are older owners who want to check out a new location for retirement but don't have the funds to float a house payment in addition to a short-term lease in the new area.

The rent-rent option could also work well for those whose plans are unclear due to divorce, death or drastic career change.

Housing prices are on the rise throughout America. But McCall says the main reason some owners are now leasing is to buy time until property values increase even more.

"A single family home is like a precious metal --silver or gold. People know it has ups and downs but will go up eventually," she says.

To illustrate how well a temporary rental can work out, McCall tells the true story of a newly retired couple who own a pale-green ranch house but have moved to a custom-built house in their home state. Because they believe their property will sell for more in a year, they're leasing it to a divorced professor with three school-age children.

"The professor is keeping the place absolutely pristine. There are no problems whatsoever," McCall says.

But obviously some who rent out their homes aren't so lucky. Because horror stories abound, she urges homeowners to exercise caution before deciding whether to rent. Here are a few tips:

-- Gather information on your local rental market.

What if the supply of rental properties in your area outstrips demand? In that case, you'll want to factor this element into your plans.

As McCall notes, most realty offices have at least one rental specialist. This person can help you gauge the supply/demand ratio for rentals in your area and how much rental income your home would likely fetch.

You can also garner clues by looking at listings for rentals in your area as featured on the Multiple Listing Service. To view these, simply visit the website of the National Association of Realtors (www.realtor.org).

-- Check the numbers on the financial impact of renting your home.

Most homeowners want assurance that they'll at least break even on their rental or, better still, enjoy a positive cash flow after taking into account their mortgage payments, taxes and insurance costs, says Leo Berard, charter president of the National Association of Exclusive Buyer Agents (www.naeba.org).

When running the numbers on a possible rental, Berard says you should also factor in home upkeep costs.

"Don't forget that if your water heater breaks in the middle of the night or your air conditioner fails on Labor Day, you'll need to pay for a contractor to fix it," he says.

Also factor in the tax implications of becoming a landlord. To do this, Berard recommends you contact an accountant.

-- Make sure your home is vacant before trying to sell it.

Mark Nash, a real estate broker, says it can be tough to sell a home with tenants still living in it.

"Tenants can undermine your sale. If they don't want to move, they might deliberately make your house messy to discourage buyers. Or they might try to block showings," says Nash, author of "1001 Tips for Buying and Selling a Home."

To avoid complications, try to time the rental term to ensure the property will be vacant for at least two to four weeks before it goes on the market. With the tenants gone, you can quickly resolve any cosmetic or repair issues that might prove a barrier to a good sale.

-- Consider hiring a professional manager for your rental.

If you want to avoid the hassle of dealing with tenants on a day-to-day basis, Nash recommends you hire a professional manager. You'll still have to pay the repair bills, of course. But you won't need to field phone calls from unhappy renters demanding an immediate plumbing or electrical fix.

"Many people are naive about what it means to become a landlord. That's why a professional property manager can be a big plus," says Nash, who has owned a number of rental units in the past.

-- Try to damage-proof your property before the tenants move in.

When homeowners sell their property, most detach themselves emotionally. But that's not the case when they lease, Nash says.

"When you rent, the emotional cord hasn't yet been cut. You're still territorial about your place," he says.

No one can that promise your home won't sustain serious damage while it's leased. But Nash recommends you take several steps to reduce the risk. Repaint your walls with an easy-to-clean semi-gloss finish. Seal your hardwood floors with protective coating. And replace valuable light fixtures with inexpensive ones.

"When you're renting short-term, you don't have to worry about becoming a professional landlord. Just hang in there until the circumstances are right to sell," he says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)

Five years ago, when a business executive in his 50s was hired as the CEO of a suburban hospital, his salary soared. To keep his commute short, he opted to live near his work, in a neighborhood of modestly priced homes. There, he and his wife found a vacant lot where they built the most opulent house for miles around.

The couple so relished the property that they continually expanded and improved it. They added several additions and ordered multiple upgrades. They also brought in expert landscapers.

But last year, after the husband's hospital was taken over by a larger one in a nearby city, he was given a new position at the acquiring hospital. Suddenly, his commute became exhausting, and the couple decided to move. So they called in a real estate agent to list their home, insisting -- against her advice -- that their house be priced high enough to let them recoup every dime they'd poured into it.

The property has had numerous showings, and buyers are impressed. But all have recoiled at the price tag. As a result, the couple's moving plans have stalled. At this point, they're frustrated, angry and uncertain what to do next.

This true story illustrates the difficulties faced by folks seeking to sell a swank property located in a community of mid-level homes, says Sid Davis, a real estate broker and author of "A Survival Guide to Selling a Home."

"Unless you bite the bullet and price it right, a house that's over-improved for the neighborhood ... can languish on the market for many months or even years," Davis says.

"Sure, people will come through your open houses because they're curious to see that big castle on the hill. But unless you price fairly, they'll soon disappear, never to be heard from again," Davis says.

The reason owners of over-improved houses can't recoup their investment is that location -- not size or features -- is the primary determinant of a home's value, says Fred Meyer, a veteran real estate broker and appraiser.

"The principle is that in a strong neighborhood the big houses will pull up the value of a small house. But if the neighborhood isn't strong, the small houses will pull down the big house," Meyer says.

Why do some homeowners spend more to expand and upgrade their property than is warranted by neighborhood standards? Davis says the most common explanation is that they anticipate living in the property indefinitely. But life, as we've seen, often turns out differently.

Do you intend to sell a home that has topped out neighborhood standards? If so, these few pointers could prove useful:

-- Avoid a "test the market" approach to pricing.

"Folks figure that if they start high, they can always come down later. Yet by the time they've cut to a fair price, their house is so stigmatized they can't even get market value. So they're punished in the end," Davis says

To avoid this outcome, he urges sellers to "bite the bullet from the beginning" with a price that reflects market realities and keeps their property from growing stale in the eyes of prospects.

-- Consider seeking the counsel of a professional appraiser.

If your house is the fanciest in the neighborhood, it may be tough to calculate its realistic market value. That's because selling prices are typically based off recent sales involving similar properties in the same community. And your place could be in a class of its own.

To get a grip on value, Davis recommends you hire a professional appraiser. In order to peg the price of an over-improved property, appraisers often visit similar neighborhoods nearby, searching for information on what other over-improved homes have fetched in recent transactions.

-- Seek to remove neighborhood eyesores.

Although it wouldn't help all owners of a high-end house in a modest community, Meyer says some sellers can benefit by assisting neighbors to improve a rundown property that's near their place.

Suppose, for example, that the home of your nearby neighbors is badly in need of a paint job or its driveway is filled with decrepit cars. In such cases, that property's shortcomings could be one factor holding down its value, and they should be addressed.

"It sounds like a bizarre solution, but it might make sense to pay your neighbors to fix up their home or to do the work for them. Explain to them how this could be a win-win solution for both of you," Meyer says.

-- Highlight features that make your over-improved house a good deal.

As Davis says, many houses that have been upgraded over neighborhood standards feature sizable additions that greatly increase living space.

"Lots of times, the owners have bumped out the back of their place to double the size of both their kitchen and family room. Also, they often expand the master suite, putting in a super bathroom with all the bells and whistles," Davis says.

He says that such enhancements deserve to be highlighted in the marketing materials prepared by your listing agent. Also, assuming your over-improved place is priced realistically, it's wise to point out that your price per square foot is less than that for smaller homes that have sold recently in your neighborhood.

"Good marketing won't make up for an overly high price. But there's no harm in touting the positives. Go ahead and tell buyers about the top-of-the-line appliances in your kitchen, your fancy granite countertops and that gorgeous family room with that zebrawood mantel imported from Africa," Davis says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)