WSJ article: Retirees who sell "forever" homes

[athena53]

This string is why I have no problem including 10 -20% of our home equity in our financial projections. If we live to 70-75, we’ll certainly sell this place and move to something smaller and less expensive. It makes a meaningful difference for portfolio survivability, too.

10-20% is pretty conservative but when DH and I downsized I'd say we pretty much broke even. The new house IS smaller than the one we left and cost about $50K less, but that was eaten up by:

-Moving expenses
-$26K to enclose the back porch
-Difference in quality (architect's original on a small lake vs. cookie-cutter McMansion)
-Had to replace the HVAC within the first year- system was 20 years old so we knew it was coming but not that soon.

We also realized that we wanted some room for DS and DDIL to visit- they live 3 hours away. They now have 3 kids and were just here a few weeks ago. You could argue the case that buying a smaller house and putting them up in a motel on their occasional visits would have cost less but I LOVE those little smiling faces looking for their blueberry pancakes in the morning!

No regrets at all and the carrying costs on this place are far less, but there wasn't much left from the equity in the previous house after the dust settled.

 

[Markola]

^^^^ I fear you are right, which is why I keep it to 10-20%. Glad you enjoy your new place.

 

[37andhappy]

From a mathematical perspective, home ownership has an opportunity cost (which is the return on capital one could otherwise be achieving). Many don't look at it like this (and indeed even exclude home equity from Net Worth calculations, but ultimately its all part of total value. Many people fail to understand this, or apply irrational emotion to the necessary calculation. Sometimes, it can help to consider a concept by taking it to a more extreme point. So, lets say a 1m house was yielding a net return of 30K a year, and appreciating at 2% a year, and you found an asset that (with the same amount of risk, or less) yielded 70K a year with the underlying assert appreciating at 5% a year - in such a case, the logical investment decision would be to sell the house and move into the more productive allocation.

I stopped buying houses after a certain point for this reason of comparative returns, and also due the the increased future risks I see of governments in some countries using houses to extract money from owners (whether through "annual land taxes", capital gains taxes, etc).

 

[DrRoy]

10 years before RE we bought land where we thought we wanted to build our forever home. At RE, we sold the land because we realized that we didn't want to do that after all. We have put a ton of $ into our existing home to make it our forever home. DW says that she thinks we will need to move to a single story some day, but I just think we'll put in a staircase lift if we need it.

 

[yakers]

we'll put in a staircase lift if we need it.

+1, some people need single level but 2 works for many

 

[DrRoy]

+1, some people need single level but 2 works for many

We have pretty much made this a custom home for ourselves and it would be impossible to repeat it.

 

[skyking1]

I've overclocked our current abode to the maximum. Time for us to do a fresh slate build. It would be our first!

 

[Calico]

We did, and still are not committed to the property we purchased just yet.
FWIW, there is only 1 level I trauma center in the state of Washington, at Harborview. I don't see that level of care as a priority, and they can airlift someone there on that rare occasion that it makes a difference.
The one within a half hour is a level III.
There are two in the entire NW. Check out this map.
https://www.amtrauma.org/page/FindTraumaCenter

Thanks for posting the link.

I hope I never need a trauma center, but if I do, it's nice to see that I live 4 miles from one, 14 miles from another, and 25 miles from a third. All Level 1.

 

[Bamaman]

I fell from a ladder getting off the roof after cleaning the gutters. Not hurt, but it was a wake up call. I'd advise you to get gutter guards. I now have them - they work great and I haven't been on the house roof since.
ETA - The gutter guards will probably cost less than dr and hospital bills from a fall.

I fell from a ladder 14 years ago after cleaning gutters. Both legs were broken, and I spent the next 2 months in bed.

We moved from that 4 acre heavily wooded lot to a home without any large trees putting out leaves. No gutter cleaning needed now.

It's nice being close to first rate healthcare, a quality grocery store and especially a pharmacy. It's also nice to have a home with a couple of bedrooms on the main floor and a substantial enough yard that can be cut by me on a zero turn mower.

 

[pacergal]

We plan to stay in our house as long as we can. Single level, approx 1700 sq ft., 1960 Ranch style. One step to the front door and one step from the garage. Nice lot 70x100, suburbs, close to big city and good medical. Bought the house in 1990. Family close by.
Can't see a reason to move right now, but you never know what the future might bring. Always keep an open mind.

 

[finnski1]

We plan to stay in our house as long as we can. Single level, approx 1700 sq ft., 1960 Ranch style. One step to the front door and one step from the garage. Nice lot 70x100, suburbs, close to big city and good medical. Bought the house in 1990. Family close by.
Can't see a reason to move right now, but you never know what the future might bring. Always keep an open mind.

Family close by may actually be a reason to move. JK.

 

[Gumby]

Family close by may actually be a reason to move. JK.

I have always been comforted by the fact that my nearest family members are over 1000 miles away.

 

[Markola]

From what I’ve observed, anecdotally, more often than not, older folks sell their houses and go somewhere else that suits them better.

 

[foxfirev5]

When I was much younger I met a very old Frenchman who was on vacation. He said he chose where he went and stayed based on how far the nearest hospital was.

At the time, I thought he was just a crazy old coot. Now......

When I travelled for work with long term stays this was one of my criteria. Who else would stay at the Hampton Inn Surprise AZ.

 

[Exchme]

I fell from a ladder getting off the roof after cleaning the gutters. Not hurt, but it was a wake up call. I'd advise you to get gutter guards. I now have them - they work great and I haven't been on the house roof since.


ETA - The gutter guards will probably cost less than dr and hospital bills from a fall.

Well, let's see. I fell off the ladder while gutter cleaning (1st floor) and broke my elbow. So I had the urgent care for the x-ray to confirm the break, plus the surgeon, hospital, anesthesiologist, months of physical therapy (turns out that you can hardly wiggle your fingers at first). After 6 weeks, the doctors removed the 1 lb weight limit, but at that point I still couldn't touch my face. Got a brace that puts tension on the arm to help straighten it that I wear for 1-1/2 hours/day. Seven months later, I have about 75% strength back and I still can't quite straighten that arm.

Insurance was billed about $50,000 for all that stuff (of course providers got much less than that) and I paid my deductible of about $7,000.

We got a flyer from someone that cleans gutters for $119, so I figure I saved that at least. But somehow I think the economics and quality of life slightly favor staying ladders.

 

[ugeauxgirl]

I'm unattached to my house, or even our geographical area. Our home is very nice and I like the location, but I'm not opposed to moving and might certainly consider it in the future. My husband IS attached and says he's going to die in this house. I AM attached to my husband so I guess we're staying... There is a small local hospital about 6 miles away, and larger medical centers about 40 minutes away. I'm not really thinking about that just yet.

 

[RobbieB]

Good. Neither am I.

The whole idea of living close to a Trauma center as a prime never occurred to me. If I'm gonna die, I'm gonna die.

At least I won't have to worry anymore.

 

[Out of Steam]

We've learned from friends there that one of our potential relocation choices would not have worked out because of lack of doctors and medical facilities. This is one of the advantages of where we are, one hospital less than two miles away, a trauma center within five.

As for forever, I don't think I want to be in a suburban house much after age 75, even our one story house. My wife says that this her last 50 year old house.

 

[meierlde]

This is not surprising.

I know a number of people who thought they would retire to the rural, uncrowded countryside, only to find that medical needs, often urgent ones, made that problematic.

Also, the idea that the kids and grand kids would love to spend a few weekends a month at Grandma and Grandpa's rural home, turned out not to be true. For some reason the children and grand children have lives of their own.

For the medical issue consider locating in the country just outside a metro with a medical school. (this is easier in the east) That gets you to where if your condition is beyond local capabilities you will go to a hospital likey in the medical center of the metro area.

Quite often an outlying hospital will decide to transfer you to the medical center facilities, and if in the event of an accident you may be taken by chopper to the medical center if needed.

 

[Livin Large in MT]

Appreciate reading these posts. Good advice re: gutters and windows too. Plan to hire any upper level work out!
We downsized from a 22 acre 3000 sq ft home to the one we are now at: 1600 feet and ten irrigated acres that suit our horses better as the grass grows better and longer than up north.
It's been 6 mo's here in Colorado and so far we are very happy. Close enough to our Denver kids while keeping busy here with the horses, golf, fishing, floating and other activities which seem to be here in abundance.
This will not be our forever home because, as wisely pointed out, we are old enough to know NOTHING is forever. If we get five to ten years, I will be happy.
Then it will be moving closer to kids or looking into assisted living facilities.
We all want to croak at home, but the reality is the slow decline is more likely and the need for care will be necessary.
I don't care how many friends you have, my experience over the years with my own parents or others' parents suggests that in the end you need to pay for care. The idea that family and friends will do that for you is a pipedream. I miss my friends up north but I can visit as often as I want. Being located in a place where you can get out and stay busy is equally important.
And yes, good medical care means a lot.

 

[tfudtuckerpucker]

BTW, if you want to read the WSJ article in the first post, but don't have a WSJ membership, just google the headline and click on the first result. Just a trick I found.