F.I.R.E without physical property?

[F.I.R.E User]

Hello. Is anyone here plan to retire and/or retired without ever buying physical property? Perhaps, buy/bought one after retirement?

 

[Sunset]

Is that like renting

 

[F.I.R.E User]

Is that like renting

Yes.

 

[Onward]

I bought a couple of properties (one condo + one house) on my way to FIRE, but they were more a hindrance than a help to me on my FIRE journey.

I would have gotten to FIRE more quickly, and with less stress, had I never bought any property.

 

[F.I.R.E User]

Why not buy a REIT fund like VNQ? You don’t have to do any work managing a property.

 

[F.I.R.E User]

I bought a couple of properties (one condo + one house) on my way to FIRE, but they were more a hindrance than a help to me on my FIRE journey.

I would have gotten to FIRE more quickly, and with less stress, had I never bought any property.

Do you regret the decision?

 

[Alan]

We were renters 6 years before retiring and for 7 years afterwards. It was only when we stopped traveling extensively that we bought a house.

 

[Bryan Barnfellow]

We owned our own homes when we lived in the States; but upon moving to Europe we rent. We feel this gives up the most flexibility and doesn't tie up our income generating funds. To compensate in our portfolio we have an appropriate weighted component of US REITS.

-BB

 

[Major Tom]

I owned a home that I lived in for a mere 4.5 years during my working years. I also owned 3 rental houses for just 2 years, which I lucked out on, and managed to sell at a good profit. For all of my adult life, with the exception of those 4.5 years, I have lived in rented accommodations. I have been retired for 11 years and currently have no plans to buy property, though that could change.

However, I do own a 1993 Airstream B190 camper van, which is a bit like owning a home, isn't it?

 

[Dtail]

We rented for 6 years before buying a house last year. Before I was FIRE, it was just easier to rent due to less maintenance work with my heavy work schedule.
We are glad we own a home now, as we don't want to be subject to rent increases and potentially moving when not our choice.

 

[pjigar]

Everyone is different, I may be in a minority but I don't like traveling as much. Its all the same everywhere I go, frenzy. I like to have my base.

If you like to travel then not owning any physical property or pets will give you more flexibility. Just look at your personality, interest and past history of those two. You will find the answer on your own.

Edit: Lately, we have been traveling mostly to natural places where I don't see a lot of people. I like that kind of travel.

 

[Aerides]

If I didn't know for sure where I wanted to live, and had no anchors like family, it might be cool to apartment hop, rent and travel, airbnb around, etc. But that requires not having much stuff (because, otherwise you're at least paying for storage which is silly), and never having pets, or, having young ones that are mobile. Older cats and dogs to not like big moves.

As it is I like where I am for the mid-term, I have pets and family...and stuff.

 

[Onward]

Do you regret the decision?

Definitely. All that house $$ plowed into index funds would have left me with a bigger nest egg, and fewer grey hairs, now. Even after subtracting out what I would have paid in rent.

 

[captain3d]

Rent if the monthly payment is below 0.5% of the purchase price. Big popular cities eg San Francisco, are like this. Think about buying the higher the %. 1% is a rule of thumb for the property to be suitable as a rental investment. So we buy those for income but live and pay rent in the opposite area. Rent arbitrage?

 

[Retch The Grate]

I've been renting for my adult life and expected to keep doing so unless I ended up somewhere it made financial sense, but my wife really wants to nest so we are looking at converting some of my investments into a house. It will definitely put back my FIRE progress (renting is still a bargain compared to buying in San Francisco), but it will make her happy so... If I was making the decision in a vacuum I'd be staying property free and being FIRE sooner.

 

[firemediceric]

I've been renting for the past 3.5 years as I prepare to retire in another 2 or so and move out of the area. This is the longest I have ever rented. I cringe as I see the real estate market continuing its fast paced rise. I feel that I am losing more buying power every day as prices continue to rise.


By the same token I try to reason with myself that I'm best to not take on a mortgage when my plan is to evacuate the area in the next couple of years. I also know that with the money I would put into my own place I would probably forfeit any market appreciation. With the modest rental home I am in I have no motivation to make improvements.


I have to convince myself regularly though that I'm making the best decision for my circumstance.

 

[F.I.R.E User]

We were renters 6 years before retiring and for 7 years afterwards. It was only when we stopped traveling extensively that we bought a house.

Because it was cheaper overall?

 

[kcowan]

We rented for 6 years after retirement, then bought a snowbird property (6 months). Still renting northern property. No change anticipated.

 

[Koolau]

We happened to own at the time of FIRE but we rented almost as much as we owned over our life times. Now we own and I would not want to rent. There are some advantages to owning once stable FIRE has been established. YMMV

 

[Sunset]

I've been renting for the past 3.5 years as I prepare to retire in another 2 or so and move out of the area. This is the longest I have ever rented. I cringe as I see the real estate market continuing its fast paced rise. I feel that I am losing more buying power every day as prices continue to rise.


By the same token I try to reason with myself that I'm best to not take on a mortgage when my plan is to evacuate the area in the next couple of years. I also know that with the money I would put into my own place I would probably forfeit any market appreciation. With the modest rental home I am in I have no motivation to make improvements.


I have to convince myself regularly though that I'm making the best decision for my circumstance.

Some places the housing is not going up much ...

 

[firemediceric]

Some places the housing is not going up much ...

That is not the case in the area i’m looking to go. The market has risen so astronomically and inventory is so sparse that people are reportedly buying homes sight unseen based on their realtor’s recommendations and even at that bidding $10,000-$20,000 over asking price. It seems crazy to me.

 

[F.I.R.E User]

We owned our own homes when we lived in the States; but upon moving to Europe we rent. We feel this gives up the most flexibility and doesn't tie up our income generating funds. To compensate in our portfolio we have an appropriate weighted component of US REITS.

-BB

Moved to Europe to F.I.R.E?

 

[brett]

We sold and then rented for five years after retirement. We really enjoyed renting. In our market, at that time, renting was financially advantageous to us. We subsequently bought.

I believe the rent vs buy is contingent on your market, you personal desires, your financial situation, and your health.

There is something to be said for not having one large indivisible asset that may or may not be difficult to unload depending on market conditions.

 

[Koolau]

That is not the case in the area i’m looking to go. The market has risen so astronomically and inventory is so sparse that people are reportedly buying homes sight unseen based on their realtor’s recommendations and even at that bidding $10,000-$20,000 over asking price. It seems crazy to me.

I think we've been here before (anyone recall the mid 2000s - just before the great unpleasantness?) Hope 2020 doesn't have yet one more bad surprise up its sleeve. YMMV

 

[F.I.R.E User]

We sold and then rented for five years after retirement. We really enjoyed renting. In our market, at that time, renting was financially advantageous to us. We subsequently bought.

I believe the rent vs buy is contingent on your market, you personal desires, your financial situation, and your health.

There is something to be said for not having one large indivisible asset that may or may not be difficult to unload depending on market conditions.

Whose market? Where I reside?