Retirement Housing Expense to Budget

[Trawler]

Hi,
Was going over the retirement budget and current expenses and was wondering for those that are FIRED what percent of your annual expenses or budget goes to cover your basic housing costs?

For DW and I we have no mortgage and live in a single family 2180 sq foot in Ohio with the following annual expenses:

Real Estate Tax $5,870
Utilities gas heat ,electric, water, sewer and trash $3,800.
Ave maintence last 6 years $1,600 This may go up some due to travel as I do yard work today myself.

Total $11,270 and is apprx 15.5 % of our Retirement Budget.

Thinking of maybe renting it out first year as we do not plan to use it much fisrt year.

 

[arky]

About 10 to 15% of my annual expenses can be related to housing. Property tax, utilities, painting about every 5 to 7 years and a new roof every 15 to 20 years.

 

[W2R]

Hi,
Was going over the retirement budget and current expenses and was wondering for those that are FIRED what percent of your annual expenses or budget goes to cover your basic housing costs?

For DW and I we have no mortgage and live in a single family 2180 sq foot in Ohio with the following annual expenses:

Real Estate Tax $5,870
Utilities gas heat ,electric, water, sewer and trash $3,800.
Ave maintence last 6 years $1,600 This may go up some due to travel as I do yard work today myself.

Total $11,270 and is apprx 15.5 % of our Retirement Budget.

Thinking of maybe renting it out first year as we do not plan to use it much fisrt year.

I have been retired for just short of three years, and my yearly average housing expenses for a 1600 sq ft paid off house has been:

Real estate tax: $884
Utilities gas heat ,electric, water, sewer and trash: $1670
Ave maintenance last 3 years: $811

BUT... you also forgot homeowners/flood insurance and some other expenses that I have such as lawn and landscape maintenance, phone, cable, and so on.

Overall including the expenses you list, insurance, lawn guy, and other housing expenses that I have (but not upgrades), my house expenses come to 11% of my budget. I don't spend all that I have budgeted, so it comes to a little under 20% of my spending.

I would really dread renting out my house. I can't imagine the amount of damage to be repaired, the issues when having to evict tenants who won't or can't pay, the stress over late rent checks, and so on. Ugh, ugh, ugh. I think some people like me just aren't cut out to be landlords.

 

[rbmrtn]

What about insurance ?

Prop Tax - 1600
Utilites - 1800
Insurance - 800
Maint - 500 ?

No major maintenance so far so that's a guess. Probably around 30% of what I spent last year. Prop Tax is my biggest expense.

 

[Onward]

I rent, and for me it's about 22%, including utils, cable, etc.

 

[FIREd]

I rent too. Including rent, renter's insurance, and utilities, housing expenses exceed 50% of our budget.

 

[Alan]

Housing expenses as a % of annual budget is 16.5%. We rent, and that figure includes maintenance, gardening, contents insurance, prop taxes, water. Add in utilities and it is 18% of annual expenditures.

 

[Lazarus]

About 18% including maintenance.

 

[arky]

Is this a stealth "Rent vs Own" thread ?

 

[grasshopper]

As a percentage

Property tax - 2.5%
Propane - 2%
Electric - 1.5%
Insurance - 1%
Home repair - .3%

Just under 7.5%

 

[aaronc879]

I'm not retired but here's mine:

condo fee:1380--going up to 1560 next year
Prop. taxes:840
Condo ins.:175
Electric:1080
Maint./special
assessments:250
Internet:780

Total:$4505/yr=36% of budget

 

[NYEXPAT]

We have two 1700 sq.ft. apartments (Own one,rent one) a block away from each other. We live in the rental and rent out the owned. Netting all expenses for both, housing actually adds a significant percentage (25%) to our budget and provides for capital appreciation at 3x to 5x inflation rate as well!

 

[pb4uski]

Our sf and total cost are similar (~2,000 sf and $11,540). But our overall budget is lower so the percentage is higher (~20% of total budget).

 

[Trawler]

Thanks for the replies thus far.
I will add the $640 per year for insurance. Property tax is 2nd largest single line expense in the projected budget.

 

[Mulligan]

Mortgage - $6000
Prop tax - 1600
insurance - $600
Utilities (just trash, water, heat, a/c)- $2400
Its about 18% of my take home pension income.

 

[Andre1969]

Mine's going to come off a little brutal-sounding, mainly because I have an HELOC on it that I'm trying to pay down fast. So, here goes:
HELOC: $13,200
Property taxes: $3100
Homeowner's Insurance: $750
Electricity: $3000 (all electric, old, drafty house, minimal insulation)
Water/Sewer: $400
Phone/Internet/TV: $1200

Total: $21,650 per year.

I'm projecting a retirement budget of $40,000 per year, so housing represents a fairly big chunk of that...54%. And that's not budgeting for maintenance/repairs.

However, I'm not retired yet, and figure I'll have the HELOC paid down, or at least down considerably, by the time I do. Just gotta resist the urge to keep raiding it!

 

[CMH in CO]

Glad you asked. Didn't realize its 26%--33% if we keep the house we live in now. Its good to have a comparison with others on this board. Now I'll be thinking about it.

Cass

 

[truenorth418]

I own a small NYC studio apartment, no mortgage.

$6,648 co-op maintenance fees - about 50% of which is property taxes
$577 - electricity
$361 - insurance

Total is $7,586 - which is about 14% of budget.

For me, one of the keys to early retirement was keeping my housing expenses low the last 10 years.

 

[Rachel]

It is 18% of budget, including taxes, utilities, maintenance, condo fee and insurance.

 

[LakeTravis]

Not retired yet, but annual expenses on our primary residence and what I use as a benchmark for my upcoming ER are:

Property taxes: $6,500
Electric: $1800
Water/Trash/Sewer: $1200
Insurance: $600

Maintenance is less than $200 a year because I fix/repair/improve everything myself.

 

[omni550]

I noticed a lot of variation in the property taxes. Don't some states have high property taxes in lieu of income taxes?

omni

 

[grasshopper]

I noticed a lot of variation in the property taxes. Don't some states have high property taxes in lieu of income taxes?

omni

Yes, and higher personal property tax(auto registration).

 

[LakeTravis]

No personal income tax here, but property taxes are a killer at 3% of appraised value per year regardless of your income.

 

[Andre1969]

I noticed a lot of variation in the property taxes. Don't some states have high property taxes in lieu of income taxes?

omni

Often property taxes will vary by county, or even location within the county. In my case I'm in Prince George's County, Maryland, and I think our property taxes are among the higher of the counties in Maryland. Local income tax is higher, as well. PG piggybacks something like 3.2% on top of the state tax rate, where some counties are as low as 2.56%. That, in and of itself isn't a big deal, but the property taxes can be.

My Mom lives about 50 miles south of me, in another county. On paper, our houses are somewhat similar. I have 4 1/4 acres, she has about 4.6. My house has, according to property tax records, 1106 square feet while hers has 1152. We both have detached garages (24x40 for me, 24x28 for her), but she also has a barn and stable. Biggest differences are that her house was built in 1979, and has a basement (which they don't count as square footage on the assessment), and mine was built in 1916 and has a crawlspace. I also have water and sewer, where she has well and septic.

As for property taxes, mine are $3100, hers are about $2000. The water and sewer can make a pretty big difference in taxes, as well. In 1978 they put a sewer through our neighborhood and threatened most of us to either hook up to it or get condemned. And for the "privilege", a special assessment was added to the property taxes for the next 20 years. I don't know if it was 20 equal payments (I was 8 in 1978) or adjusted to inflation, but I remember seeing some of the final tax bills in the mid 90's, and they were sticking an extra $500 per year to pay for that sewer.

So, we were paying for it in the first place, and now paying to maintain it, AND we have to pay to use it (water/sewer bill...and the sewer portion is much more expensive than the water portion). But, on the plus side, I don't have to worry about maintaining a well, or septic tank

 

[Brett_Cameron]

Mine is 19% of budgeted expenses.
Mortgage, insurance, taxes, homeowners association fee, electric, gas, water, garbage disposal, TV, internet, phones.
Maintenance would be another 1%.