Kennedy Real Estate Solutions
Kevin and Sharon Kennedy, Kennedy Real Estate SolutionsPhone: (860) 304-4433
Email: [email protected]

When to Buy a Retirement Home?

by Kevin and Sharon Kennedy 01/29/2020

Photo by Harli Marten on Unsplash

Although it may seem like putting the cart before the horse, a strong case can be made for purchasing your retirement home before your golden years. In fact, with some deft financial planning, it may be worthwhile to buy your retirement home decades in advance. That may seem counterintuitive, but maybe other folks have been doing it backward. Whether you are a Millennial, Gen Xer, or Baby Boomer, the best time to plan ahead is right now. Consider these strategies.

Why Buying Now Saves Retirement Dollars

The Gen X crowd was born between 1965-1979, making them 40- and 50-somethings. Those are generally prime financial years. In many cases, they’re nearing the end of a mortgage and are probably enjoying the fruits of many years of savings. This means having equity and resources at their disposal to make a move on a property now.

The argument for paying off an existing home loan or doubling-up if it’s reasonably low rests on data that the home values continue to rise. Consider these incremental increases in median home sales pricing.

  • 1970: $23,400
  • 1980: $64,60
  • 1990: $122,90
  • 2000: $169,000
  • 2010: $221,800
  • The median price routinely topped $300,000 in 2019, and the robust economy, coupled with an inventory shortfall, is expected to drive prices upward. If you were to have purchased your retirement home just 10 years ago, your savings would have amounted to nearly $100,000, plus lower interest payments. Those are real retirement dollars.

    Why Buying Your Retirement Home First Makes Sense

    One of the strategies savvy Millennials are employing is to purchase an “investment property” rather than a primary residence first. That may seem like thinking way outside the box, but the math and lifestyle considerations can make it a smart play.

    This demographic runs between 23 and 38 years old, and they have grown up in a vastly different culture than their predecessors. Some are straight out of college struggling with student loan debt, and even the top end of the age bracket has members still evolving their careers in many cases. These factors tend to position Millennials for ongoing relocation as they take advantage of emerging opportunities. Rather than be burdened with buying and selling a home, it’s easier to rent.

    Financially sharp Millennials, among others, have purchased properties in culturally rich areas that lend themselves to college students and tourism. The strategy is to enlist the help of a real estate professional who oversees renting, upkeep, and allow the asset to pay for itself. In many cases, it may even yield a profit. When retirement age arrives, there can be ample revenue to do a full remodel and just pay the taxes while you collect a pension or social security.

    Although buying a retirement home prior to punching out for the last time may seem odd at first, it’s in your best interest to run the numbers both ways. Consider all the moving parts and detailed costs to make an informed decision about your best time to but a retirement home.

    About the Author
    Author

    Kevin and Sharon Kennedy

    "A Personalized Approach to all your Real Estate Needs" Sharon and Kevin Kennedy have built Kennedy Real Estate Solutions with the premise of building relationships and finding creative solutions to unique real estate situations, both residential and commercial. The Kennedy’s work with their clients with the intent of getting a full understanding of the client’s current situation and desired real estate goals. With this understanding and the knowledge that has been acquired from over 50-years of real estate experience, Sharon and Kevin offer guidance and advice best suited for the individual client. Buying and selling a home can be an emotional and trying time for most folks. The Kennedy’s are sensitive to their client’s needs in this ever changing real estate environment. They are with them every step of the way and will help to address whatever challenges arise. About Kevin J Kennedy, Broker/Owner Kevin J. Kennedy is a dedicated and successful Realtor/ Broker. He helps his clients buy and sell homes throughout the beautiful Lower Connecticut River Valley and Connecticut Shoreline. Since buying or selling a home is a major life event for most people, both financially and emotionally, it is important to have an agent you can trust and with whom you feel comfortable. An essential part in creating a great real estate experience is choosing an agent who is detail-oriented, has up-to-date market knowledge, and is a skilled negotiator. Kevin offers all of these qualities. Today, many buyers and sellers insist on the advantages of cutting edge technology. Via his web site and IDX property finder, Kevin delivers. Using these state-of-the-art tools, his buyers save time and energy during the house-hunting process, and his sellers are able to reach numerous prospective buyers. Kevin is highly regarded in the real estate community and is a consistent top producer. He lives in Old Saybrook, is an instructor of T'ai Chi and QiGong, and enjoys photography, music, and kayaking. Call Kevin at 860-304-4433 About Sharon S. Kennedy, Realtor Sharon grew up in Old Saybrook. Her family owned and operated one of the first local real estate companies. She first received her real estate license in 1988 and now has more than 35 years of real estate negotiation experience. Sharon enjoys gardening, spending time with her horses, chickens, cats and dog along with preparing wonderful vegetarian meals for her family. She is knowledgeable in homeopathy and natural remedies. Today many buyers and sellers insist on the advantages of cutting edge technologies, Via their web site and IDX property finder, Kevin and Sharon provide state-of-the-art tools. Contact them today to discuss your real estate needs.