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View Poll Results: Do you rent or own?
I am retired and I own 97 58.43%
I am retired and I rent 13 7.83%
I am not retired and I own 45 27.11%
I am not retired and I rent 11 6.63%
Voters: 166. You may not vote on this poll

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Old 10-18-2015, 08:59 PM   #41
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Originally Posted by Aiming_4_55 View Post
[I]

For a 3 bedroom condo in a beach city, our monthly rent is $2,500.
Could you mention in what beach city you can find a 3 bedroom condo or apartment for $2500?

I don't doubt it, but I am quite interested in where this is, and how close to which beach.

Ha
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Old 10-18-2015, 09:17 PM   #42
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Plus, there were no taxes on capital gains on the sale of your principal residence!
Well, in Canada that's true. Don't know about the country/state that most of the posters here live in.
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Old 10-18-2015, 09:37 PM   #43
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Well, in Canada that's true. Don't know about the country/state that most of the posters here live in.
Well, brett lives in Canada, so it does apply in his case.
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Old 10-18-2015, 10:46 PM   #44
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In CA (LA area), if I purchased a 3 or 4 bedroom home, just better than a starter home, it would be about $1,000 a month in property taxes. LA county sales tax is range from 9% to 9.5%. I guess I'll enjoy the weather when I can.
That probably has more to do with such houses selling for at least $800K (probably closer to $1M) than high property tax rates. Iirc, tax rate in LA county is something like 1.125%.

And yeah, absurd prices are pretty much what's stopping us from buying. We're actually fine with starter homes (minimum 2B/2B for family of 4) but even those go for $600K.
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Old 10-19-2015, 03:29 AM   #45
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My property taxes are 1800$/ year in North San Diego County. But having bought in the 1982 is why they are so low. However, in our future retirement home, which we bought 3 years ago in Washington St, the property taxes are 3k$ per year. I can't fathom $1k/month property taxes.

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Old 10-19-2015, 07:51 AM   #46
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When we retire in a few years (hopefully!), I keep telling myself that we will sell our house here in AL and rent in FL first to learn the local area better before perhaps buying. We learned our lesson when we first moved to AL from PA; we bought right away and then discovered after living there a while that we didn't like that location very much.

We had to go on assignment for DH's job for several years, so we ended up turning that townhouse into a rental. When we moved back here we decided to keep it as a rental, while we bought our current home in a location we like much better.

If our current renter moves out when the lease is up 6 months from now, we are considering selling our rental and buying something in FL that we rent out until we move there...but still need to investigate the tax consequences of moving into your rental.

The closer we get the more excited we get! Shooting for 2018 now as that is the year DH will turn 55 and we can access his 401K without penalty. It will give us more security than counting on our taxable accounts soley. We could retire now on a careful budget, but DH still loves his job and wants more security before we pull the trigger, so he has chosen to continue working.
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home ownership poll
Old 10-19-2015, 08:02 AM   #47
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home ownership poll

I am retired and I own
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Old 10-19-2015, 08:17 AM   #48
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I own now, but the plan is to sell next year and rent, at least for the next few years. Reasons being:
  • I'll still be working for the next few years, so want to stay relatively close to work. Once I retire, I'll have more options geographically.
  • I've been in a SFH for 20 years. I think I want to go to the apartment/condo/townhouse concept, but not sure I can share walls again. Better to try than buy.
  • I'm just tired of taking care of the house all by myself. And by that I mean finding (and paying) the person to fix, mow, shovel, paint, etc.
  • My property taxes are now over $9,000 and I just got a new assessment that had the house's assessed value go up 18%. Can't wait to see what next year's taxes look like.
  • Property values are finally back up to about 3% over what I paid for my house 12 years ago. Don't see them going much higher any time soon.
  • I should be able to get a very nice apartment for about $500 or more less per month than my mortgage/tax payments.

Yep, there's a risk of rental prices going up. But the $300K or so of equity I have in my home will help offset that. And if I find that I'm not comfortable with the uncertainty or the lifestyle, I can always buy again.

At least that's the plan. And we all know how plans change
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Old 10-19-2015, 09:19 AM   #49
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We own a house with no mortgage. I'm retired; DW still working OMY. The house is way too big for our needs... 4500 sqft on 2.2 acres with a pool. We bought it 12 years ago when the kids were young teens. We will definitely downsize at some point despite a strong emotional attachment.

I'd consider renting at that point if there was a clear financial justification. But I just don't see it. I've used all the online tools and compared results with my own models. There does not appear to be a strong case one way or the other except under unusual circumstances or biased assumptions.

The non-financial considerations also favor owning for us. We enjoy changing things on a whim. I'm a DIY nut. We take great pride in the house and "making it our own," inside and out. It's part of our identity. So, even after we downsize, we'll probably buy rather than rent, unless something changes drastically on the financial side of the equation.
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Old 10-19-2015, 10:10 AM   #50
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Seems to me that in retirement, having total control of your living arrangements would be important. It would really irritate me if the landlord decided to sell or move in himself, kicking me out in the process. Also, not being able to decorate or upgrade to my tastes would be an issue. In most cases owning probably costs more but in my circumstances worth it. Maintenance can be laid off on hired help and we do. The small bit of maintenance I do is mostly enjoyable.

It is certainly not about amassing assets or extra space. These need not be negatives of owning in my view. Buy a smaller house if the old one is too big or a condo.

Retirement, in my opinion is all about control, ie doing what you want, when you want, if you want. In my view renting compromises this somewhat. For some probably not an issue but I have found since retiring 9 years ago, control is increasingly important to me.

Many have extolled the advantages of renting in the context of flexibility and I can see that. I guess I have gotten around that somewhat through multiple homes. Obviously not practical for the vast majority. So is it flexibility vs control and security? If so, take your pick.
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Old 10-19-2015, 10:10 AM   #51
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We are only three years or so into retirement with the same amount of time as renters.

We have been travelling quite a bit. Two things have changed for us. The first is we require less space than we thought we did prior to retirement.

The second is that it seems experiences are beginning to trump possessions as we age. We do not care so much about owning a big house, two cars, whatever. It is not that we do not want a home. We do. However it is not something we dote over. I think the most liberating thing for us about downsizing and selling our home is that is opened an entirely new world of possibilities for us.

We travelled for six plus months after we retired and sold our home. So glad we did as it changed our perspective on many things beside home ownership, home location, size etc. It is as though now we are really free to do anything we want and travel where we want. We may buy where we live in Canada, we may rent, we may buy something in a warm climate...who knows. But we have much more of an open mind and a true understanding of our needs and wants than we did prior to retirement and when we were home owners.
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Old 10-19-2015, 10:26 AM   #52
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There is an attachment bias for owners, as illustrated by the previous two posts.
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Old 10-19-2015, 10:32 AM   #53
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Most people hate change. If they own a house when they retire they will stay in that house. So I think the results of this poll are biased. A better poll, IMHO, would be a poll that asks only people who have moved since retirement have they bought another house or started renting. This would be a better gauge of who got tired of owning. Lots of people who retired and still own their house may want to start renting for the convenience of it but just dont want to move.
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Old 10-19-2015, 10:32 AM   #54
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My property taxes are 1800$/ year in North San Diego County. But having bought in the 1982 is why they are so low. However, in our future retirement home, which we bought 3 years ago in Washington St, the property taxes are 3k$ per year. I can't fathom $1k/month property taxes.

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But - as you posted previously, your home value has gone up - and if you were to buy your home now it would be over $5k/year. Your tax rate is lower because you've lived there a long time and Prop 13 keeps it down. I am in the same region and also have a significant tax advantage from prop 13. My next door neighbors, with the exact same house, pay over $8k/year compared to my $3k/year.


The rent vs own is both a financial question and a personal/lifestyle question. I think some people are of such a mindset that homeownership is the only way to go - but people who live in a "hot" market (like Southern California) might find it cheaper to rent than to own. I know that it's cheaper to rent than to buy in my neighborhood. And the personal issue comes into play if you want to modify the purchased home - you can't move walls, redo kitchens, make major changes in the garden, etc, if you're a renter. So there is no "one size fits all" answer to rent vs buy.
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Old 10-19-2015, 10:54 AM   #55
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There is an attachment bias for owners, as illustrated by the previous two posts.
Not sure what you mean by this?
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Old 10-19-2015, 11:18 AM   #56
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I absolutely agree that there is a bias. We probably had that bias prior to downsizing/selling.

We were brought up in an environment where you got married, had kids, owned your own home. Home ownership was a huge goal, and an indicator of where you were in life.

I also believe that the bias, and extent of it, is based on where you live. My spouses family live in a sub 75K population city or less. They all own their own homes, have lived in them for years. Renting is something that people when they simply cannot afford to buy. I do not think that this attitude is as pervasive in large urban areas or with those who closely follow the economic trends.
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Old 10-19-2015, 11:30 AM   #57
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Not sure what you mean by this?
Attachment bias is a tendency to make decisions influenced by possessions we already have. We are attached to homes that we already own. Therefore we may be more likely to believe that owning one's home is preferable.

Bias Definition | Investopedia

Your post illustrates this, while brett's post illustrates the opposite point of view. Neither is incorrect.
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Old 10-19-2015, 12:21 PM   #58
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I think owning a home is preferable if you could stay in one place for a long time because inflation would probably raise the rent much more quickly than the cost of maintenance (and property taxes etc) of a home but that only applies if you live in an area where value of real estate appreciates. I used to live in an apartment in Tucson about 30 years ago and paid $420 for it. The rent at the same place now (30 years later) is only $550/mo. I don't know how that is possible...


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Old 10-19-2015, 01:17 PM   #59
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In my case FIRE means not only financial independence but also location independence. I want to be as mobile as possible while I have the health, finances, and desire to travel and I don't want possessions to weigh me down. At some point I may buy something when I know I want to stay in one place. The way I see it, eventually I'll be stationary.Forever.
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Old 10-19-2015, 04:28 PM   #60
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Attachment bias is a tendency to make decisions influenced by possessions we already have. We are attached to homes that we already own. Therefore we may be more likely to believe that owning one's home is preferable.

Bias Definition | Investopedia

Your post illustrates this, while brett's post illustrates the opposite point of view. Neither is incorrect.
Thanks. I understand. Also about
85% of the people who responded are currently owners and something like 60% of Americans are home owners, higher in Canada. I agree I have a bias towards home ownership for the reasons I discussed. I don't think this is an opinion caused by my current possessions, rather the possessions are based on my consistent desire for control.
Retirement can certainly change you view in this regard. But it only reinforced mine for the reasons discussed.
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