Should I Rent Or Buy After Retirement?
Should I Rent Or Buy After Retirement?
If you’re like many of my clients, you’ve decided your current home won’t fit your needs for long after retirement, but the great debate is holding you back: should I rent or buy my next home?
Ask yourself these four questions to end the debate and start a plan to move forward.
1. Is it time for flexibility or solid roots in your life?
For some, renting and the minimal commitment that comes with it is a perfect fit to their new lifestyle. It allows for you to test drive a new neighborhood, housing style or a more nomadic lifestyle.
For others, home is the figurative (as well as literal) foundation to their lives and remaining homeowners is a source of stability to their day-to-day lives. Owning removes the relationship with a landlord and their role in your life, which for some is very important.
2. How long do you intend to live in the new home?
Some people decide to Right-Size prior to retiring, whether it’s to take advantage of a strong housing market or to live in a more manageable space after the kids move out. An important consideration is how long you are planning to live in the home you move to, after selling the larger family home. If you are thinking you’ll retire in a year and then move out of the city for good, it might make more financial sense to rent for that year.
If you want to keep a residence in the city after retiring, even for part of the year, purchasing a smaller home or condo could be a great solution both financially and for peace of mind.
3. Freedom from your house or freedom from rules?
Freedom for renters comes in the form of not having to worry if it’s time to replace the roof or if the washing machine is acting up again. When you rent you are paying the landlord for the right to live in and enjoy the home. Part of that arrangement means the responsibility for maintenance falls to the landlord.
Freedom for owners comes in the form of having control over your space. When you rent you have to clear decorating choices with the landlord and you have little (if any) say in how a repair is carried out. Owning means you carry the cost to maintain the home, but also control over the decisions involved.
4. Do you want the equity now or later?
Selling your home and renting means you have the option to invest that freed up equity in other ways or create a plan to live off your nest egg.
If you buy another home, it’s more difficult to access that reinvested equity but as real estate is typically considered a safe long term investment, your capital is protected, and hopefully appreciating, while keeping a roof overhead.
4 Considerations for Aging In Place
4 Considerations for Aging In Place
Sometimes RightSizing can mean staying in your own home by making modifications. If you aren’t sure where to start, here are four areas to think about if Aging In Place is an option.
1: Small changes, big impact
There are numerous modifications that can make a world of difference when it comes to how you interact with your home. Grab bars in bathrooms are a common solution, but think about other places where one might come in handy like the top of a set of stairs. Other hardware upgrades include changing your doorknobs to a lever style, installing pull out drawers in you lower kitchen cupboards, and floor lighting to automatically make getting around at night safer.
2: Same home, different function
If your mobility is affecting your enjoyment of your home, there might be options to reduce the number of stairs you need to face on a daily basis. Outside, ramps and lifts are a possible solution. Inside, beyond installing a stairlift or elevator, look at you main floor for opportunities to make it more functional. A powder room off the kitchen, moving the laundry up from the basement and creating a main floor bedroom are all examples of solutions we have seen to reduce the reliance on stairs and allow homeowners to continue enjoying their home.
3: Take the pressure off with an extra set of hands
You’re able to still manage your home but some chores have become more daunting than you’d like to admit. Multiple services exist for just this reason and range from help shoveling the snow to bringing your fresh groceries to the door. There are options that can fit every budget to take on some of the heavy lifting that goes with with home ownership.
4: An ounce of prevention…
… Is truly worth a pound of cure. When renovating think about changes you can make now that would serve you as you age. There are some brilliant ways to create a more adaptable home for people who plan on Aging In Place. We are happy to talk about changes that would increase your property value and those that could limit the buyer pool down the road.
Please reach out below to discuss your unique situation.
6 things that have changed in Real Estate since you bought your home
6 things that have changed in Real Estate since you bought your home
Many of My clients have not bought or sold real estate in a number of years.
Here is an overview of legal, procedural, and marketing changes that have come about over the last few decades.
Agency Representation.
Prior to 1995, all real estate agents in Ontario were representing the interests of the seller of a property. This was confusing to buyers, who thought the agent helping them buy a home was working for them. Since 1995 buyers are typically represented by an agent they have “hired” to work for them and protect their best interests. In all Canadian jurisdictions, a REALTOR® is required to present you with a written explanation of how representation works at the beginning of the relationship.
The Paperwork.
The mountains of paperwork can seem daunting. Your REALTOR® will walk you through it all and give you time to have your lawyer and your family look it over, if you wish. The forms are standard, so most lawyers will be familiar with them.
Home Staging.
With all the design shows on TV these days, buyers expect every house they walk into to look perfect. In response to this, an entirely new industry was born: Home Staging. Stagers are trained to make your home as visually appealing as it can be, and to maximize flow and use of space. Staging helps potential buyers move through your home with ease, and also sets the stage for excellent photos.
The Internet.
It was only 3 years ago that the Toronto Real Estate Board made the change to allow 20 photos per listing instead of 9. This was important, because when buyers aren’t watching design shows, they are scouring listings on the internet. Those perfectly staged photos need to stand out in a sea of listings. REALTORS® are no longer the gatekeepers to listings – the internet feeds listings to buyers faster than any agent possibly can. This has shifted the role of the REALTOR®, placing a greater emphasis on skilled negotiations, marketing and analysis.
Home Inspections.
Before they commit to buying your home, a buyer will want to have an inspection done. The inspector is trained in general construction matters, and a good home inspector is in the home for 2-3 hours, inspecting and preparing a report card on the home’s current condition for the buyers. Inspectors look for the good, the bad, and the ugly, and provide a detailed report.
A more recent change is that a home inspection will often be completed in advance of a home being listed. This “pre-list” inspection report will be provided to potential buyers to reduce the likelihood of conditional offers on a property. This is common practice in markets where there are often multiple offers on the same home.
Multiple Offers.
Multiple Offers are not a new phenomenon, but they have become a lot more common in the last few years. The likelihood that a home will receive multiple offers depends on a number of factors, including the state of the market at the time of listing, the neighborhood, the number of competing listings, the list price, and the strength and execution of the listing marketing plan.
Many sellers will choose to set an offer date to encourage multiple offers. A set offer date is typically 5 – 7 days following the list date. This approach allows for a marketing period, so the property can be exposed to a larger number of potential buyers. On the set offer date, any interested party will submit their offer for consideration. Within a set amount of time the seller will be able to consider and weigh the multiple offers and select the best fit.
A prudent REALTOR® will establish ahead of time the seller’s preferences, including closing date, what is included and excluded (for example, window coverings), and how they would like the offers to be presented. There are a number of strategies and negotiation options available when navigating multiple offers. A well-managed and transparent process garners the best results.
You may very well have more questions. Contact me and I will be happy to walk you through the process and the options.