Moving in ER.

[walkinwood]

I wrote this post over the past few weeks. I am happy to answer questions or elaborate on points. Thanks for reading

When we ER'd in 2008, we knew we would move from the town we were living in (in NJ), but didn't know the timetable or the future location. As we traveled, we kept our eyes open for possibilities. Our requirements were- an urban location
- socially and environmentally progressive
- lots of things to do with easy access - especially outdoors
- employment opportunities in case we needed to go back to work
- and of course, affordable.


A few cities we traveled to met the criteria in varying degrees. Portland OR won our hearts; we loved Seattle, Asheville NC was nice, but a bit too small for us. Friends of ours suggested Boulder, so we went to take a look. While there, we spent 3 days in Denver and decided that it was a good candidate. We deliberated for a couple of months & decided to move.


As I have written before, we went back to work for most of 2010 to shore up our portfolio.


We sold our NJ house in mid-2011 & moved to Denver. Not knowing much about the city (or even if we'd like it), we rented for a year while we explored the neighborhoods and the available housing stock. We love Denver! After living in a 1925 house for 15 years, we knew we wanted something new, so after much looking, we bought a new house - and moved in last week.



I thought I'd share some of the things we learned along the way:


- Take your time deciding on the place. While we made a decision after visiting for just 3 days, we had been thinking of it for years and knew what we were looking for, so when we saw what we wanted, the decision was easy.


- Be honest about what you're giving up. Know that you may never get some things back. In our case, it was our wonderful neighborhood & neighbors & proximity to (imho) one of the greatest cities in the world (NYC). We are also far from most of our family & friends, but again, we made a conscious decision & also decided that we would make the effort to stay in touch.


- There never is a right time to do this. Life intervenes, and you just have to take a decision and do it.


- Prepping your home for sale, selecting a realtor, selling it, selecting a mover, packing your belongings, moving them & yourselves, buying/renting another home, moving in, filing moving-damage claims (there will be damage), unpacking, settling in - is a lot of work and a major PIA. Don't underestimate the physical & emotional effort involved. I am glad we did it while still young and energetic.


- The cost of living sites are generic - you need to live somewhere to get a feel for your own personal cost of living. With the huge exception of health-insurance cost (50% less) and property taxes (35% of our NJ taxes), the other expenses were more or less the same. A small surprise - our auto insurance went up a bit!


- Renting is expensive if you want to live in a place that is comparable to a house that you would buy. Since we've just bought, I don't have actuals on our housing costs, but estimate that it will be about 1/3 to 1/2 the cost or renting. The main reason is that safe investments (the proceeds from your home sale) are making nothing today. On the other hand, making a mistake with a real estate purchase is way more expensive. We are glad we rented.


- If you don't know people in your new town, you need to work at making friends. IMHO, there are friendly people (your type) everywhere, and you just need to make the effort to find them. The effort pays off big time in the long run. We have made a small group of friends here that we just love. meetup.com is a great resource.


- We found the change invigorating. DW commented that it was like dating again. We loved our old neighborhood & neighbors, but we had our set of friends, our set of restaurants, things to do etc - in other words, we were 'settled' - almost in a rut. This move made us go out and explore and we love it. And we keep an eye out to make sure we don't fall in a rut again - time will tell.

 

[Moemg]

- Prepping your home for sale, selecting a realtor, selling it, selecting a mover, packing your belongings, moving them & yourselves, buying/renting another home, moving in, filing moving-damage claims (there will be damage), unpacking, settling in - is a lot of work and a major PIA. Don't underestimate the physical & emotional effort involved. I am glad we did it while still young and energetic.


.

All your points are excellent but this one really hit home .I would love to downsize but the thoughts of all the physical & emotional work stops me in my tracks . Plus I really am not sure what type of housing I want next .

 

[Meadbh]

Moving is supposed to be more stressful than divorce and I certainly found it a huge undertaking. I knew I wanted to move from the location where I spent over 20 years furthering my career. With that in mind, I selected a place that would be good for ER living and found a job there. I moved last year and some of my moving expenses were reimbursed. Because I moved to work, I was able to claim real estate costs as tax deductible expenses. While working, I am developing many new friends and contacts here. I am also fortunate to do a lot of work related travel around the region, which gives me many ideas about areas I would like to explore in more depth after ER. I think I have fund an area with a good balance of climate, services, access to transportation, things to do and cost of living. I am hoping not to move after ER, at least not far!

 

[walkinwood]

...With that in mind, I selected a place that would be good for ER living and found a job there.

In retrospect, I wish we had done the same thing. Working makes it easier to create a social network. It would have helped a great deal to have someone else take care of the moving expenses.

 

[FIREd]

I moved to San Francisco 3 months ago and while I love almost everything about this city, the move has taken a bigger toll on me than anticipated. The move itself of course was very stressful (downsizing, preparing the house to be rented out, finding a new place on the other side of the country, screening movers and property managers, packing, unpacking, turning utilities on/off, dealing with damaged items, finding new doctors and dentists, dealing with DMV stuff, etc...). But leaving good friends and family behind and coming to a place where I have no real support group has been equally hard. I am paying the price right now. I haven't felt stressed out like this since I quit working. And my heartburns are back. Hopefully everything will get back to normal as I settle in.

 

[walkinwood]

I moved to San Francisco 3 months ago a.... Hopefully everything will get back to normal as I settle in.

It will.

For me, a social network is key. I feel more relaxed when I can hang out with people (in addition to DW) regularly. We had one good friend and a cousin (that we liked, but didn't know very well at the time), and that was enough. Meetup.com gave us the means to make new friends.

 

[palomalou]

- If you don't know people in your new town, you need to work at making friends. IMHO, there are friendly people (your type) everywhere-

I'm not sure I believe this, at least, not in my experience. I think that people who think similarly tend to want to live in similar places.

 

[GT1 Doug]

I have to agree with walkinwood about renting before buying, even before selling your old place. Visiting a place is nothing like living there. I have never been able to find a house (the right house) when I went on those two or three day house hunting trips when I had to move because of my job. In one case we avoided a near disaster by not buying a house we liked during one of the aforementioned trips. Things like local politics are not readily evident if you are there for short periods of times (that nice wooded field behind you is a future EPA Superfund site or the I-666 extension will be located 500 feet from your front door). Short and long term apartment rentals are a good deal compared to buying the wrong house, particularly when they are so difficult to sell.

 

[haha]

- Renting is expensive if you want to live in a place that is comparable to a house that you would buy. Since we've just bought, I don't have actuals on our housing costs, but estimate that it will be about 1/3 to 1/2 the cost or renting. The main reason is that safe investments (the proceeds from your home sale) are making nothing today. On the other hand, making a mistake with a real estate purchase is way more expensive. We are glad we rented.

This is a good point, but it is very place specific. In Seattle anyway, renting any given place appears to me to be cheap compared to the costs of owning it, even not considering the getting in and getting out. Owning is only better if you bank on considerable price rises, which is certainly not totally crazy given the strong labor market for well paid tech workers, and to me at least what will eventually be a blowout inflation.

Also, most people are not nearly so picky about something they rent as they would be about something they are going to buy. One's owned house, at least in America, carries an ego weighting that one's rental does not. This may not matter to the Spocks on this board, but it does to many (most?) people. Same as we feel different about the appearance of our cars compared to a cab we are riding in.

When I was condo hunting over the past few years, to stay in my same neighborhood I would have to have spent $250-$300K to buy a place only slightly bigger, and worse in many ways than the place I rented for $1250. Where I live now there are many more multifamily buildings, some older but many brand new high rises. The rents here are more than the old neighborhood (more employment a short walk away) but puchase prices are considerably less.

Walkinwood- I am glad to hear that things have worked out so well for you.

Ha

 

[Khufu]

- Renting is expensive if you want to live in a place that is comparable to a house that you would buy. Since we've just bought, I don't have actuals on our housing costs, but estimate that it will be about 1/3 to 1/2 the cost or renting.

I doubt that owning is that much cheaper than renting if it is cheaper at all. The OP is probably ignoring the opportunity cost of his down payment as well as maintenance costs, taxes, and insurance, i.e. all the costs that don't show up immediately.

 

[walkinwood]

I doubt that owning is that much cheaper than renting if it is cheaper at all. The OP is probably ignoring the opportunity cost of his down payment as well as maintenance costs, taxes, and insurance, i.e. all the costs that don't show up immediately.

If you want to keep your principal safe, opportunity costs are almost non-existent. We got a whopping 1.13% for a one year CD. Longer durations aren't much higher.

Your rent includes all the other costs, plus interest costs if the owner has a mortgage, plus a profit. In the boom days of the mid 2000s, renting was cheaper than buying for a while, but it isn't true today - at least, not in Denver.

 

[Huston55]

Your rent includes all the other costs, plus interest costs if the owner has a mortgage, plus a profit. In the boom days of the mid 2000s, renting was cheaper than buying for a while, but it isn't true today - at least, not in Denver.

This is market/location and home-type dependent. For example, most of the condos in locations that DW and are interested in are much cheaper to rent than buy on a monthly cost basis.

 

[Khufu]

If you want to keep your principal safe, opportunity costs are almost non-existent. We got a whopping 1.13% for a one year CD. Longer durations aren't much higher.

Your rent includes all the other costs, plus interest costs if the owner has a mortgage, plus a profit. In the boom days of the mid 2000s, renting was cheaper than buying for a while, but it isn't true today - at least, not in Denver.

Once again you are stacking the deck in favor of the buy decision. You certainly don't believe that the equity in your house is as safe as a CD, do you? So, you just moved up the risk/reward frontier by taking more risk. You could have done that with a variety of investments other than property.

If your reasoning that rent covers all the other costs were true, it would always be the case that owning is cheaper than renting, but we know that isn't so. There are certainly many accidental landlords who are cash-flow negative after the housing crash.

 

[Midpack]

Somehow I missed this when originally posted, a very good summary, thanks. We expect to move at least once more, and thought we were ready - but not sure we're quite ready to give up on what we have where we are just yet, but one day in the years ahead...

OTOH, ask me in Jan thru Mar when we're shoveling piles of drifting snow & ice just to get out and the power goes out for hours or days. Grrrrrrrrrrrr...

 

[W2R]

Somehow I missed this when originally posted, a very good summary, thanks. We expect to move at least once more, and thought we were ready - but not sure we're quite ready to give up on what we have where we are just yet, but one day in the years ahead...

That's pretty much the same frame of mind as ours. We love living where we are, but we expect to move eventually.

I think we could bear the hurricanes, but the crime rate in our area is ridiculous and out of control. Still, there is so very much to love about living in New Orleans.

 

[haha]

If you want to keep your principal safe, opportunity costs are almost non-existent. We got a whopping 1.13% for a one year CD. Longer durations aren't much higher.

Your rent includes all the other costs, plus interest costs if the owner has a mortgage, plus a profit. In the boom days of the mid 2000s, renting was cheaper than buying for a while, but it isn't true today - at least, not in Denver.

I agree with assertion #1, but the 2nd paragraph is debatable I think. On a square foot basis the apartment owner has paid less in taxes than the individual owner everywhere I have ever lived. And if he has scale, he also usually insures for less, gets his maintenence done more cheaply, his landscaping and public area done more cheaply, etc. And profit? Other than very large projects, most rental pitches that I have listened to try to sell alligators that optimistically backload estimated profit unto sales price.

Agree with others, it really depends on where you are.

Ha

 

[walkinwood]

Thanks for all the input especially pointing out that I am further out on the risk spectrum by owning a home.

 

[Sun456]

Welcome to Denver! It has alot going for it. Were not sure this is where we will retire but if we chose someplace else it will only be for a change. Not because there is anything wrong with Denver.