The pandemic is hurrying this trend along: many retirees who have been cooped up in lock down may be looking to move to a warm-weather climate with plenty of safer outdoor space. This may be the perfect time to start a new life in a better place, and there are added benefits to the life change.
Here are just a few:
Enjoy a nice cushion of funds.
It’s not uncommon for many people to begin their retirement with a shortage of savings. For those who own their house outright — or at least have a lot of equity in the property — a strong housing market could produce a surplus of funds for living, while finding a lower-cost new place to live.
Allow for a tax break.
Because of the Home Sale Exclusion, unmarried people can exclude up to $250,000 in profit from the sale of their main home. If you’re married, you can exclude $500,000. Note that you have to have lived in your home for two out of the five years from the date of sale. Other rules apply — be sure to check them out.
Reduce annual property taxes
Nobody wants to spend their retirement fund on expensive property taxes. Some property taxes are the same or even greater than a mortgage payment. Finding a new home in a new market may come with a greatly reduced property tax burden.
Some markets — like Nevada and Florida — have no income tax.
This makes the market particularly attractive, especially to retirees who plan to work part time or start a passion business.
Reduce or eliminate maintenance.
Older people may not want to be bothered with the usual maintenance tasks that they have had to do for years in their current home. It may be time for a condominium or rental that leaves the heavy lifting (and lawn mowing, and snow shoveling) to a maintenance team.
Eliminate the challenge of stairs.
Stairs can create a challenge for many retirees, and can affect the simple task of getting around. A ranch-style home, condo or garden apartment may eliminate the need for climbing stairs and make getting around much easier.
Live in a higher-tech house.
The idea that older people can’t handle new technology is nonsense. Retirees may love to start a new life in a new home that offers the most current features of good living. Perks could include smart refrigerators and lighting, laser projectors for watching movies, and bluetooth speakers throughout the home.
Note: before you make any huge decisions like selling your current home, be sure to consult a professional Realtor for advice and navigation. Matt Scannapieco can prepare a CMA for you (a comparative market analysis) which compares your property with other homes in your neighborhood that have sold within the last 180 days or are currently listed. This gives you the best idea of what your home is worth, and may keep you from agreeing to a sale that is far below your home’s actual value.
Not every retiree has the same idea of the perfect home, but common benefits like lower taxes and expenses, more income, easier ways to get around, and amazing modern technology could be a shared goal for starting a new life in a new place. Better late than never!