To downsize and move or stay put? (taxes, mortgage, government)

[StealthRabbit]

Originally Posted by Escort Rider

... but tenants can be a huge hassle and cause lots of problems. If you have the skill ...to get good ones, that's one thing, but it's not guaranteed.

True, thus I'm a proponent of COMMERCIAL (Triple Net Leases (NNN)). Tenant pays Taxes, Insurance, Utilities, Repairs, Maint (ALL interior, windows, and doors)... you are just renting them a Shell (For which YOU are responsible).

1. I screen FINAL tenants VERY carefully, doing background and financial checks ($40)
2. For Commercial NNN I also review their business plans and profitability and capital resources / business marketing and operational profiles, and their REPUTATION and licensing / litigation w/ state (public records, etc.)
3. Have a bullet-proof lease in MY favor ($250 (1 time) for me, 'free' for a lawyer )
4. Commercial tenants you can evict with immediate notice or ONE screw up on their part. (no 'renter - protection' (apart from contract) Not as 'human rights / residential rental protection laws', which are State rights, sometimes dragging on for over 1 yr)
5. Commercial tenants have a vested interest in your property, condition, presentation, longevity, reputation, neighborhood, city, district... (It is their livelihood.)
6. I often end up selling property to them and carrying the paper (an even more passive approach to income (good for post age 70), and good for both parties. (no slimey / 'leech' Banks involved, good returns, favorable rates... I require at least 30% down, and ONLY finance properties in VERY good shape, and that I know I could resell quickly)
7. Commercial Tenants MUST carry an insurance binder with owner as Additionally Insured. Thus you have an additional proof of they business solidity, as reducing Insurance is one of the first 'cost-savings' attempts of a business in crisis.


(BTW: I sure wish C-D would fix # and bulleted lists... I find it currently inserts a lot of bogus txt i.e. pics/cd / ...)

[d.montalvo]

This is a great thread. Lots of advice.

But I'm wondering if there are people who did go through with their retirement decision (probably after tons of advice like this thread, too) and found it wasn't exactly for them.

Perhaps the weather and personal income taxes were ideal, but property or local taxes weren't; or there was a quality of life factor that wasn't taken into account, like distance from family...

Any honest tales of caution?

[StealthRabbit]

Originally Posted by d.montalvo

...I'm wondering if there are people who did go through with their retirement decision (probably after tons of advice like this thread, too) and found it wasn't exactly for them....

War stories from those I have known: (in this order of frequency)
Family (not realizing how much they would actually miss them, or changing needs requiring more care)
Health Concerns / changes (them, spouse, or family required moving back or to another location)
Climate - was fun to visit, but too harsh to live there (VT is common for this). Too Hot, Too Cold, Too humid, Too Dry ...
Services - didn't plan well for future changes in interests and health
Work Tasks - very common for 'city-folks' to idealize a 'farm' / rural life, but it = 24x7 WORK REQUIRED. Large gardens, home, log home, flowers, swimming pools, ponds, LONG driveways, outbuildings... all require LOTS of maint.
Location - (having a hardware store 5 minutes away beats 3 hrs @ $3.00 / gal). Getting a ride to airport or medical 2 hrs away can become a costly issue.
Culture - (I can't believe folks are that different, but they are!)

Wanderlust - that was nice; lets go elsewhere

malcontents - "I don't like it ANYWHERE"

[AcaciaRose]

d.montalvo, after retiring I felt restless and wanted a drastic change, so after spending many hours researching lots of different places, I decided last summer to move back to the midwestern state where I grew up. I had visited there several times in recent years and have close family there. (I'm a widow with no children.) Because home prices are reasonable there, most people own rather than rent, and I couldn't find a nice apartment, so I bought a place. Last summer, shortly after I moved, even before the moving van with my furniture arrived, I realized I had made a mistake.

I won't make this post too long by listing all the reasons why, but I knew I couldn't live here.
Fitting my reasons into StealthRabbit's categories, location, climate, work tasks, and culture all apply loosely.

As soon as the worst winter weather is over, I'm moving and putting this place on the market.
I desperately do not want to make a second interstate move, so I'm using great care choosing where to go next. Although I did that kind of research BEFORE. Maybe I should just throw a dart at a map! ;-)

[texdav]

In the end its a personal decidon really. Can even depend on the perosn . I saw mnay guys get homesick when in the army others adjusted well to new palce. Likely the same here.

[StealthRabbit]

Originally Posted by riverbird

...I decided last summer to move back to the midwestern state where I grew up. I had visited there several times in recent years and have close family there. ...

decided ..to move back ... another very common option and / or mistake. It CAN work for many, but not most. Things and people change (both the locals AND even more so, the ones who left.) Often the ones who have stayed are not too trusting of the ones who left, and those who first left, know they can do it again if necessary. As much as I like the place I left (N. Colorado), the same reasons I left are even more evident now, and I will need to accept that (and more) to return. Maybe later, maybe never.

Maybe I should just throw a dart at a map! ;-)

I trust you are 'luckier' than I . I can see that dart falling on a place for which I have great distaste. (not that I don't have some further 'refining' to be done...)

[catman]

I don't think that one can really know what it is like to live in a new location without actually living there, but that doesn't mean he shouldn't research it as much as possible and hopefully spend some time there beforehand. It's going to be a jump into the unknown to some extent, though, no matter how much one tries to make an educated decision. I'll likely be doing it in a few years.

[AcaciaRose]

Research helped me rule out a lot of places.

I like my home state very much and I admire the people who live here. I can't live here, but that's because of my personal situation, not any shortcomings of the city or state.

I'm not sorry I made my move, costly and difficult as it was, because it made me aware of some things I had in my last city that I hadn't thought about that I missed terribly once I no longer had them. I'm lucky to have the means and ability to make another interstate move.

I suggest that anyone who is thinking of relocating spend at least two weeks there in the off season. That is, if the person dislikes summer heat, rent a furnished apartment in August; if cold bothers them, rent a place in January. Staying for a few days in the nicest weather while going out to dinner every night with beloved relatives is not the best way to decide whether to live there, in my experience. ;-)

[Wilson513]

I think persons retiring think that weather is a big factor and often flee to the moderate climate areas. Does this make sense? Seems like a good idea, but giving up all one's friends, family, and familiar surroundings seems like quite a sacrifice. Season rentals are not too bad in Florida. Probably a $3000 to $5000 annual cost for a seasonal rental as long as you don't need to be on the water. Is that a legitimate alternative?

I just remember having to run down to Florida to rescue grandma every time something happened to her.

[azloafer]

Originally Posted by newenglandgirl

You may well be paying close to that monthly in rent.

It is better to pay on a mortgage than the same amount for rent. Property tax and interest deductions will be deductible on taxes and you will be ahead in the end. If you rent and pay $1500 a month you have no deductions at all.
That's why we are staying in our home. We still have a mortgage, but because we paid a good amount down, our mortgage payment is much smaller than renting plus we have tax deductions. If the government eliminated the deductions it would be a different story. Something to think about. Joe