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Update: It's almost two years since I posted this thread originally. I'm still in my apartment. I still want to buy my own place. I still don't know where I want to retire to. Retirement could be December 2014. I still want a better place than my apartment, but renting a house would cost a lot more than my current rent. What i have learned from the answers to my original post – don't settle just because you want your own place – has served me well. I'm still waiting for that feeling of "I'm home" when I walk in the door.
Thanks for the update! I started reading the thread and thought, "Geez, she's long-gone by now" and pleasantly, there you were! My advice is don't buy the house until you know what you're doing in retirement....or, plan on staying there awhile unless you can afford to lose money. You are so close -- you've already been there 20 years. Would you be buying the place cash or have a mortgage?
I am 62. Theoretically, I could retire in four years. I have been in an apartment for almost twenty years and all that time I have yearned for a little house of my own. Now I have some inheritance money and could buy that house, especially since prices are so low right now. I've even seen a place that I can afford, although it needs some work and I would have a yard to take care of. The thing is I am not sure that I will want to stay in town when I do retire. Is buying now crazy? What advice would you give me?
It depends on what state you are in. If you are in a state that has had a serious drop in real estate prices, then I say buy by all means. You will most likely make money. Even if you decide to move somewhere else in four or five years, you will undoubtedly make money. I would add one more year onto that time frame, as Ideally what you should do is (if you decide you want to move to another state or any kind of distance) is rent your place for a year when that time comes and move into the area you want to live and rent an apartment.
Then take the year scouring the area so you know it backwards and forward. You know the value in the different areas, you become familiar with certain homes in areas you would like to move to. Then when the year is up, have a fresh coat of paint put on if needed in your home, and put it on the market and sell it. Find the house you want and make an offer.
I am uncertain of the price range you are looking at, but if you are able to pay cash for it, don't forget to
save that money you would have been paying in rent. It will be the best return on investment you can get nowadays. You will be paying yourself perhaps 6 to 9% interest, as opposed to 1 or 2% in a CD, plus if you are in a depressed state, you will most likely have some good appreciation in the next five years.
I have had rental properties all my life, so I have a little experience. Of course there are never any guarantees, but i would say the odds are very much in your favor.
Were I renting and planning on retiring in 4 years the only home purchase I would consider would be if I was retiring/staying in my present area. If I knew I would be relocating in 4 years, then I would wait until then to purchase in my new location. Also if not familiar with my new location I might rent for a year there to get to know the area better before I purchased.
If available where you will be relocating to, you might want to look at Homeowner Association type living arrangements. I mean like townhouses as in side by side, small standalone patio homes. I am not refering to condo/apartment style living with units above, below, beside, behind, etc.
Here is a link to where I live to show what smaller patio homes can be like. I have no business arrangement with the developer:
It depends on what state you are in. If you are in a state that has had a serious drop in real estate prices, then I say buy by all means. You will most likely make money.
The fact that an investment goes down doesn't mean it will go up. I wouldn't consider property in Florida or in any of the other basket case states. Those places have so much investment housing with no renters that those prices still could go way down. They certainly aren't going to go up anytime soon. I live in an area where real estate sales slowed but prices never did go down and now they're moving up. I'm far more comfortable here with my property. We don't have vacant houses here.
Think of this as any other investment. Of course, buy the home that meets your living needs; but employ all of the investment criteria as well. And remember that whatever goes down is not guaranteed to come back up, never, ever.
Well, I hate to disagree with you, but I will. I live in Florida. Prices are escalating monthly. There is a buying frenzy and there are not enough homes available for the under $200,000 price range. Same thing in Arizona and Nevada. They have seen 30% increases this year alone. In Nevada and Arizona, if you don't have cash to buy a house you are out of luck. Need to bone up on what's happening. Should check out City Data for Phoenix, or Las Vegas, Nevada, and you will see for yourself.
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