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6 Ways to Know If You Should Rent or Buy When Relocating

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Former teacher Janine Consoli and her husband, Tony, who are embarking on a second career as a freelance travel and food writer, have decided to sell their townhouse in Bucks County, Pennsylvania, and move to Florida. Their first thought was to buy another property. House.

But the couple had trouble finding homes to buy in their target market, Sarasota.

“The real estate agent said, ‘Sorry, that property is currently under contract,’ and canceled me three or four times,” recalls Janine, 57. “That’s why we decided to rent.”

It turned out to be the right choice for them. The couple found an affordable two-bedroom apartment in a building that Janine says reminds them of Brooklyn-style brownstone (except in pastel colors). It’s close enough to Tony’s office that the 58-year-old insurance executive can walk to the office without worrying about commuter traffic.

“We have lived in this apartment for a year and love it,” says Janine. The couple still plans to buy a home, but renting has given them the opportunity to take the time to get to know their new home better.

Whether you’re already retired or want to get a head start on your future retirement by moving early, if you’ve owned a home for many years, it’s important to decide whether to buy another home or rent it instead. face a tough choice.

spinner picture The pastel-coloured building (left) rented by Janine and Tony Consoli in Sarasota, Florida.

The Consolis are renting an apartment in the pastel building on the left, but they hope to buy a house in Sarasota in the near future.

Thomas Simonetti

“Ultimate Question”

Retirement planners and moving experts depend on a number of factors, including your financial status, the housing market for your new location, how well you know the area, and your confidence that it will be your last move. Say. Both choices have potential advantages and disadvantages, so you’ll need to find the balance that works best for you.

“Renting or buying is the ultimate decision facing migrating retirees,” said Mark Charnett, founder and CEO of American Prosperity Group, a retirement planning firm in Pompton Plains, New Jersey. It could be a problem,” he says. “I can’t say which option is better because it really depends on each retiree’s circumstances.”

About three-quarters of baby boomers own a home, but recent data suggests that proportion is starting to decline, says Doug, senior analyst and manager at Yardi Matrix, a real estate intelligence firm. Mr Ressler says

“I think we may be at the beginning of an inflection point where the number of baby boomers renting out is increasing,” he says.

Here are six questions to consider when deciding whether to rent or buy when moving.

1. How is your finances?

Ressler said that while home rents have skyrocketed during the COVID-19 pandemic, renting remains generally a cheaper option than taking out a new mortgage. Yardi Matrix and Moody’s Analytics data show median monthly rent in Q1 2023 is higher than median mortgage payment based on his 30-year fixed-rate mortgage with a 90 percent loan-to-value ratio. was also $471 lower. property value as a percentage of loan balance).

Derek Meiser, investment adviser and CEO of Meiser Wealth Partners, said he could pay for a home in cash or put down enough money to secure a low monthly mortgage. If you can afford it, he says, it will make your purchase significantly cheaper in the long run. Knoxville, Tennessee. But upfront costs, such as closing costs, can be high, and ownership requires ongoing expenses like property taxes, homeowners insurance and maintenance, he said.

Rentals have lower initial costs, but typically require a security deposit equivalent to one to two months’ rent, but the rent can increase significantly with each lease. According to property website Rent.com, from April 2019 to April 2023, the median price of an apartment in the United States rose more than 20%, from $1,619 to $1,967.

2. How much would you like to simplify your life?

Moving from Huntington, NY to St. Petersburg, FL in 2021 has made life a lot easier for Chris McDonald. “I sold my house, but it was a lot of maintenance,” he says. “I have arthritis and needed a lot of repairs.”

McDonald, 70, who works part-time as an online tutor, rents a condominium in a 55-plus-year-old complex that doesn’t need to be refurbished and has access to four pools.

Janine Consoli, who has lived as a homeowner for years, also enjoys the reduced responsibility of living in an apartment. Instead of a three-story townhouse, she says, “Now she’s got a two-bedroom, one-story house.” “Easy to clean, cool and maintain.”

“The desire for simplicity can be a big factor for people,” says Barbara O’Neill, a former Rutgers University professor and author of the book. Flip the Switch: A Guide to Happiness and Financial Security in Later Life. “You don’t have to do any house maintenance, you don’t have to mow the lawn or shovel the snow.”

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