Owned by Sight Scotland, charity chiefs told family and residents on Thursday evening that they propose to potentially close the Blackford facility by April.
The charity’s second specialist care home in Paisley, Jenny’s Well, will also close.
Chief Executive of Sight Scotland Mark O’Donnell today confirmed these closures were due to an increasingly difficult financial environment caused, in part, by the coronavirus pandemic.
Adding that the charity has been forced to delve into their own reserves to keep the specialist facility going during the pandemic.
Mr O’Donnell said: “It is with great sadness that we have announced that we are proposing to potentially close our two care homes for older people, Braeside House in Edinburgh and Jenny's Well in Paisley.
"An increasingly difficult financial environment for care homes has meant we have had to subsidise heavily our older people’s care homes from our charitable reserves to a level that is no longer sustainable.
“The pandemic has thrown these issues into sharp relief. We have sought independent expert advice from different sources, all of which has sadly concluded that there is little realistic prospect of turning this around.”
Annual losses incurred at care homes is as much as £1.5m and is expected to increase to about £2m in the current financial year.
Mr O’Donnell said the charity had sought independent expert advice which concluded that there is little realistic prospect of turning this around.
Families of residents at both homes have been left devastated by the "unexpected" news and have highlighted concerns about the logistics of moving their frail relatives.
The daughter of one 95-year old resident who has lived in the care home for 10 years says she is horrified at the prospect of moving her ‘frail’ mother.
She said: “My mum is old, she has five per cent vision, dementia, is bedridden and very frail.
“I am horrified at the idea of moving her, especially during a Scottish winter. If I am honest, I have no idea how we are doing to manage it.”