subject: Staying Home For Retirement [print this page] Many homeowners who are on the verge of retiring are considering selling their homes, usually to downsize and move to a house that's more affordable to maintain, while recouping a good amount of money from the sale itself and getting the benefits of saving on home repair and maintenance. Some seniors are also considering renting. Both options appear to be good ones to many retirees and middle-aged people, although there's the chance that staying in your current residence is a viable short-term alternative.
It was part of many seniors' retirement plans to bank on their home equity for their nest egg, and still is. One possible downside of this option is that the retiree may not have enough money to move, or pay for their new homes in full, even if your home is in your ownership at present.
There are conditions that may require seniors to stay in their current homes, and stop them from moving and downsizing. In many areas in the United States which have started to recover, the prices of homes have regained stability to a small extent - this means you're unlikely to sell your home at the rate you want. Lower your projections of what your home is worth, although the price tag on the house you're eyeing is also subject to the same influences.
Downsizing to get lower property taxes isn't a sure, long-term deal - the amounts you need to pay for taxes where you want to move may catch up with the rest of the country, eventually, since the economic downturn will cause local effects to average out. Avoiding the problem (in this case, high taxes) is rarely effective - you'll have to face it, head-on, after some time. As communities will tend towards increased taxes on local and state levels when they balance their budgets, you'll receive the brunt of bigger taxes.
Downsizing your home after you move isn't always feasible, especially as taxes and real estate prices will equalize in time. Even if you don't take this into consideration yet, you may not have enough once you've taken stock of your finances, your home's current value and the cost of moving. To see if downsizing and moving is an option that you can afford, study your finances and talk to your retirement planner.
