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Retiring as a lifetime renter?
Old 01-19-2018, 10:03 AM   #1
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Retiring as a lifetime renter?

Hello everyone. I'm a federal employee that has moved around a lot, including overseas, and so I have never owned a home. I really don't want to be tied down in one location, and I have no interest in all of the work associated with owning your own home. I'm a single parent with two kids (now 11 and 13) and already feel like I am juggling a lot.

If I luck out and get VERA, I could possibly retire in the next 6+ years, but that is very unlikely. It is more likely that I have 13 more years. Anybody else retire without owning a home? Lifetime renters? How has that worked out for you?
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Old 01-19-2018, 11:07 AM   #2
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As a single guy I rented for most of my pre-FIRE life, and all of my eight years post-FIRE.

Rent vs. own is an eternal debate on this forum. I'm in the "rent" camp and feel it gives me flexibility and and a certain lightness of being that I value highly.

There are some disadvantages to renting, too, which I'm sure you're aware of.

But for me renting is working out just fine, and I have no plans to change.
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Old 01-19-2018, 11:19 AM   #3
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Originally Posted by movaly1 View Post

If I luck out and get VERA, I could possibly retire in the next 6+ years, but that is very unlikely.
what's VERA?
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Old 01-19-2018, 11:33 AM   #4
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what's VERA?
Voluntary Early Retirement Authority
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Old 01-19-2018, 11:57 AM   #5
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I did an early retirement before the age of 50 (CSRS) and took the expected actuarial hit. If you are FERS and have socked away a lot in the Fed version of IRA it may work out well for you provided you don't need to tap tax protected savings too early.

Once your children are out of the nest you may want to look at a co-op if you are in DC metro.
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Old 01-19-2018, 12:16 PM   #6
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I've spent the last decade renting across three states after retirement, in middle to upper class apartments for the area. Consistently prices have been going up about $1,200/year when renewing a lease, a little more if I rent a garage for the motorcycle.

The plan was to rent forever and uproot ever so often, but this broken body just can't handle packing, unpacking, and moving, let alone getting out on adventures often. Staying rooted now, it makes more sense to buy a house financially (by at least $300,000 over a lifetime of renting versus buying even taking into account major house repairs and upkeep, taxes, etc.). Even so, if I could still travel, that cost could easily be absorbed, and I wouldn't have minded renting forever.
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Old 01-19-2018, 12:50 PM   #7
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I'm a homeowner, but I don't see why being a renter has any real impact on retirement plans. It comes down to retirement income vs retirement spending. And having a home is by no means a "freebie."
Sure, I don't pay rent. But I have the pleasure of paying real estate taxes instead, and of course all of the maintenance costs of owning a home. So I don't see where being a renter or homeowner is any substantial (or, any) factor in assessing retirement finances.
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Old 01-19-2018, 12:52 PM   #8
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For many owning a paid-up home is an important factor in being able to retire, early or later. This is especially true if one lives in an area where home prices well above average and going up, with rents not far behind. OTOH, the ability to rent and move about the country and/or the world does seem very tempting at times.
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Old 01-19-2018, 01:52 PM   #9
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We own because rents in our area are rising every year by a lot. Plus we have 3 dogs. I also like to decorate the way I want with paint, flooring, etc. When you rent you are not in control of moving if the landlord wants to sell, etc. My sister has been a lifelong renter but her circumstances are different.
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Old 01-19-2018, 02:12 PM   #10
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Rent vs. own is an eternal debate on this forum. I'm in the "rent" camp and feel it gives me flexibility and and a certain lightness of being that I value highly.
Exactly. There are so many variables to each person's circumstances that there is no "one size fits all" answer. Either way you're still going to pay for that roof overhead.

We choose to live in a paid off SF house, but if say, DW ran off with the pool boy (highly unlikely but stranger things have happened) then I would give serious consideration to renting. Somewhere warm too!
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Old 01-19-2018, 02:25 PM   #11
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I can envision it making a difference in situations where the retiree wants to limit income for means-tested benefits like ACA subsidies or MC Part B.

If your assets rest in tax-deferred accounts which you have to tap to pay the rent it could have highly leveraged side effects. If the assets already rest in the form of owning the house, it won't.
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Old 01-19-2018, 03:50 PM   #12
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Like others stated, there's no wrong answer in most cases (same with mortgage / no mortgage in retirement) . We'll probably stay in our home until we no longer want to fool with ownership chores. After that, probably modest rentals on some sort of snow bird arrangement.
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Old 01-19-2018, 11:46 PM   #13
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I'm a homeowner, but I don't see why being a renter has any real impact on retirement plans. It comes down to retirement income vs retirement spending. And having a home is by no means a "freebie."
Sure, I don't pay rent. But I have the pleasure of paying real estate taxes instead, and of course all of the maintenance costs of owning a home. So I don't see where being a renter or homeowner is any substantial (or, any) factor in assessing retirement finances.
There are plenty of good reasons to rent.
However if a person stays in the same house for 20 or more years, it's probably more cost effective to own.

After all landlords rent to someone, and they make a profit on the situation.

I am a small landlord.
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Old 01-20-2018, 01:25 AM   #14
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I think that the decision is a function of your personal preferences, the housing market/rental market where you live, and the return on investment funds that you would otherwise commit to a home purchase. And your time horizon of course.

We have done both. We recently rented a condo for four plus years. Financially renting turned out to be a much better option for us since our RE market was negative.
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Old 01-20-2018, 06:43 AM   #15
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If you own your house outright and only need to pay taxes and upkeep I don't see how renting is a financial positive.
Rents in my area run about $3K per month ($36K annually) for a decent place; that's a big chunk of one's WR.
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Old 01-20-2018, 08:26 AM   #16
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Home ownership has a tax implication (mostly positive) and a lifestyle implication (often positive) and has to be evaluated based on individual circumstances.

In our case, we rent in one location and own in the other.
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Old 01-20-2018, 08:57 AM   #17
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If you own your house outright and only need to pay taxes and upkeep I don't see how renting is a financial positive.
Rents in my area run about $3K per month ($36K annually) for a decent place; that's a big chunk of one's WR.
Real options. Some factors:
  • Renting frees up capital I can deploy elsewhere
  • Risk concentration: own part of 1000 companies, or 1 house in a specific street?
  • Broker fees if you move frequently
  • I always rent exactly what I need


The best trade-off is highly situational, both in geography as in individual circumstances.
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Old 01-20-2018, 09:05 AM   #18
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In our case, we rent in one location and own in the other.
Do you own or Rent the PV Property? Just curious. You can PM me with the answer so as not to Hijack the thread. If you Own there, what gyrations with the government did you have to go through, if you are close to the beach?
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Old 01-20-2018, 09:11 AM   #19
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This is has been a question I have asked myself for years. I have always found that to rent an equitable property in a comparable area that we live would cost a lot more than the upkeep of owning. Renting almost always forces you to settle for a less desirable home in a less desirable area. If you do not care, that is all good. In our retirement years we want to live in a nice home in a good area.

Our Home is worth about $800k give or take. It is in a private community. Homes in the community vary from $450k to $3m.

Total costs all in were $1,738.14pm for 2017. To rent a comparable home would be $3,500 - $4,500pm.

Now, of course this is based on owning your home without encumbrances.
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Old 01-20-2018, 09:12 AM   #20
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Do you own or Rent the PV Property? Just curious. You can PM me with the answer so as not to Hijack the thread. If you Own there, what gyrations with the government did you have to go through, if you are close to the beach?
We own in PV by paying for a bank trust ($400/yr plus IVA). So far we have not rented it because we are there Nov-Apr. That may change next year.
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