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I am currently a home owner and have been for a long time. We are both in our 50's. Our daughter is going to be moving off to college and we are considering selling our home and just renting an apartment or condo. I think we have reached a point in our lives where we dont want to own a home anymore. We currently have a waterfront home and could walk away with about 100,000. I figured we could just invest that for after we retire. We are debt free except for our home. Any comments are appreciated.
You’ve answered your own question. You don’t want to own a home anymore. Do what works for your own needs at this point in your life. Not all decisions need to be made from a financial perspective being the highest priority.
1. what is your current house payment in dollars and cents?
2. what will be your exact rental payment per month?
3. if you sell, will you remain in the same zip code?
essentially, we have found that rents in our area
are way/way too high to consider selling our home.
Last edited by turkeydance; 02-12-2019 at 06:50 PM..
Reason: nsfw
In many cases, it’s more expensive to rent than to remain in your house depending on the operating costs, tax deductions and possible appreciiation. You could certainly sell your home and invest that equity that you’ve created, however there’s no guarantee that that money will grow faster with a different investment instrument. Guess it all needs to be carefully evaluated!
I am currently a home owner and have been for a long time. We are both in our 50's. Our daughter is going to be moving off to college and we are considering selling our home and just renting an apartment or condo. I think we have reached a point in our lives where we dont want to own a home anymore. We currently have a waterfront home and could walk away with about 100,000. I figured we could just invest that for after we retire. We are debt free except for our home. Any comments are appreciated.
whenever i can invest at a greater return then the house after considering the rent i would do it ..
keep in mind too that there could be a bigger advantage tax wise to renting because you get to fly the empty seats and that money can reduce the rent .
the homeowner is likely spending more money on deductible items so while a couple gets to take 24k in standard deductions they may be actually spending that . the renter may have very little in comparison in deductions so they get to take the standard deduction and get back money they never actually spent .
I agree with others, renting may not be cheaper than owning, even with maintenance costs for owning a home.
You need to crunch some numbers to see if it works for you....we can't, as you haven't given us any numbers to work with.
And it may not matter to you if you have enough income to cover either one renting or owning. If you do, good, then I'd say go ahead.
We could not rent our home for what our mortgage payment is here where i live, even with added maintenance. And we are in a reasonable market, not an outlandish one.
But if you can afford either one, then as the previous poster said...you've answered your own question. Go and rent.
I'm partial to owning, since i rented most of my life, but it ultimately is up to you.
And if you leave the $100k invested and get 8-12% annually in say a mutual fund until you are in your 70s or 80s, you'll have a tidy sum. If left alone invested and returns 8% for 20 years will be about half a million, or at 12% will be close to a million in just 20 years.
We are debt free except for our home.
I am currently a home owner and have been for a long time.
We currently have a waterfront home and could walk away with about 100,000.
Having a mortgage and being a home owner are NOT the same thing.
Quote:
We are both in our 50's.
Our daughter is going to be moving off to college...
Any more kids? Are the college costs all squared away?
Quote:
I think we have reached a point in our lives where we don't want to own a home anymore.
I figured we could just invest that for after we retire.
You leave out some important details like how long it would require to pay off that mortgage
and how much less you'll pay for a rental that will suit you in order to have the rest available
to also invest for retirement (without an owned home the portfolio is even more critical).
But if all the rest suits then go live your life as you please.
Except for the interest you pay on your mortgage, over the long run when you “own” you are essentially living for free. Huh? Free? Yes free When you eventually sell the house you will get all of your principal back. So the later you are into paying off that mortgage the less interest you pay and you start living partly then totally for free. Now of course you pay maintenance. But done well you get this back because the house will appreciate in value. And for my statement to work the economy needs to remain steady and the area where the house is needs to remain desirable. But if you are one of average luck then financially you will win out by owning until the house is paid off or nearly so.
The mortgage interest deduction on federal taxes used to help a lot for the early mortgage years. Too bad that is now gone
I am currently a home owner and have been for a long time. We are both in our 50's. Our daughter is going to be moving off to college and we are considering selling our home and just renting an apartment or condo. I think we have reached a point in our lives where we dont want to own a home anymore. We currently have a waterfront home and could walk away with about 100,000. I figured we could just invest that for after we retire. We are debt free except for our home. Any comments are appreciated.
With the TCJA, I think it reduces the draw for home ownership since the interest and taxes can be minimized. SALT limits your taxes, and interest isn't deductible on mortgage over 750k mark. Plus the increased standard deduction may make itemizing deductions moot (it does for our family).
Also even after you pay off your mortgage, you are still responsible for the real estate taxes and insurance on the home so you don't ever really stop paying for the home. Real estate taxes and insurance do go up, so it's not like home ownership is that much of a hedge against rising rental rates. Don't get me wrong, I still plan to pay off my home very soon but you do have to think about these things. Home values are not guaranteed to go up, up, over the years either.
If you feel like you don't want the responsibility to own a home, then don't. There are benefits of being a renter. Maintenance isn't your responsibility. You don't have to deal with yard work. You can leave the apartment/condo after your lease ends and move somewhere else much easier than trying to sell a house.
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