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My husband, age 60, lost his job in the oil and gas industry three months ago, and since then, he has only been able to obtain temp jobs that pay about 40% less than what he was making. If he does not find another full-time permanent job that pays well soon, we will need to sell our current home, but the good news is that the Denver real estate market is very hot right now and we can sell our home for a significant profit. However, although we would have enough money between the sale and our savings to buy our “dream” retirement home in the New Hampshire Lakes Region, nothing is listed in that market now that meets all our requirements.* (Open concept “one level living” with a wood burning fireplace that is visible from a large-ish kitchen, and at least a one-car garage, for under $350k. The perfect size for us would be about 1,400 square feet.)
We do not want to rent an apartment because we have a large dog and a cat, so we are thinking of buying an interim single family (but not mobile) home in New Hampshire at the lowest possible price that is livable, about $150k, and then selling it when a home that does meet all our needs and wants comes on the market. (Ideally, this would not be until my husband is 65, at which time he plans to start collecting social security, so that we can more easily afford the higher property taxes that a more expensive home would have. Btw, we would be able to pay for the temporary home in cash, with enough income from my social security and a small pension to pay our monthly expenses, and still have enough of our savings left to pay for the larger home later, as long as we can sell the “temp” home for about as much as we paid for it.)
Does this plan sound feasible, and if not, what alternatives would you suggest?
*There are several homes available now in the $250-350k range that do meet all our requirements, except that they have gas fireplaces instead of wood burning ones, and we are not sure how easy those would be to convert – especially the gas fireplaces in newer homes. (Any input about that would also be appreciated.)
1. You are too picky. Letting a gas fireplace prevent you from buying is silly.
2. Hope you are prepared for NH property taxes. They are more than you would pay in Colorado for property + sales + income.
3. My brother lives near Dartmouth and therefore has excellent medical facilities close by. What is the situation in the lakes region?
4. Do you know what the winters are like in NH?
Use caution if your dream home is important to your plans. Life has a way of coming along and detouring the best laid plans. Your temporary home could easily be a poor second to your dream home.
Plan A: Buy the house in a location you like and just plan on spending more money later to renovate to your dreams. That would be alot cheaper than the expenses of selling.
Plan B: Buy the temp house. When you are ready to move, refinance it and then use it as a rental income property. Then buy the forever house.
Location: Stuck on the East Coast, hoping to head West
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No, I would not do this. I think it is incredibly risky to put all of that cash in an illiquid asset, particularly since your plan is contingent on that house not losing value.
Also, you're assuming that when your dream house becomes available, 1) you'll be able to sell, 2) you'll be able to sell for what you paid for the house, 3) selling costs, and 4) that the seller of your dream house will wait until all of this happens. You're also assuming that your interim house will not need any major repairs while you wait for your dream house to hit the market. That's a whole of if's.
I'm assuming that because of your income, you won't be able to obtain a mortgage?
You should rent until you find your dream house. If you don't want an apartment, then rent a house.
1. You are too picky. Letting a gas fireplace prevent you from buying is silly.
2. Hope you are prepared for NH property taxes. They are more than you would pay in Colorado for property + sales + income.
3. My brother lives near Dartmouth and therefore has excellent medical facilities close by. What is the situation in the lakes region?
4. Do you know what the winters are like in NH?
1. Actually, no. There have been two homes on the market since April that would meet ALL of our requirements, but they both were under contract within two weeks. One was even lakefront (for $275k), and one was only $150k!. (Both were in Ossipee, which is not as prestigious as Wolfeboro or Moultonborough, for example, but we don't care about that.) Yes, they both needed some work (minor repairs and they could have used some redecorating from what I could see online), but nothing out of our budget. (Of course, it goes without saying that we would have inspections before buying!) Also, we prefer wood fireplaces to gas for many reasons.
2. Yes, we are very aware of the much higher property taxes, generally speaking, in NH, and that is why we want to wait to buy a higher-priced property until we are sure that our monthly income will cover that. (However, NH does offer property tax breaks to seniors that vary from town to town, I think.)
3. They do have a hospital in the Lakes Region (Laconia).
4. Yes, we lived for three years (including three winters) in Bridgton, Maine, which is about 60 miles from the NH Lakes Region.
And, thanks to you and everyone else who answered so far! Some very good advice has been given!
Last edited by katharsis; 06-26-2016 at 10:02 AM..
*There are several homes available now in the $250-350k range that do meet all our requirements, except that they have gas fireplaces instead of wood burning ones, and we are not sure how easy those would be to convert – especially the gas fireplaces in newer homes. (Any input about that would also be appreciated.)
Personally, requiring a wood burning fireplace seems really over the top to me.
But in regard to conversion, some (many?) Areas will not allow new homes to be built with wood burning fireplaces. I'm guessing those areas would not allow a conversion, either.
Certain areas even have 'no burn' days.
I've no idea if that applies to NH, but you might want to check.
Personally, requiring a wood burning fireplace seems really over the top to me.
But in regard to conversion, some (many?) Areas will not allow new homes to be built with wood burning fireplaces. I'm guessing those areas would not allow a conversion, either.
Certain areas even have 'no burn' days.
I've no idea if that applies to NH, but you might want to check.
Just FYI, as you are at least the second person reading in this thread who has questioned this:
1. We LOVE the ambience of a crackling fire, the smell of wood smoke, plus each wood fire is different, and we enjoy watching the fire die down and watching the glowing embers. You don't get any of that with a gas fireplace -- or at least none that I have experienced.
2. We have always lived on a wooded lot, and so we have never had to pay for firewood. Gas prices fluctuate, and we use our fireplace a LOT in spring, winter, fall and also on cold rainy summer day -- although there are not many of these in Denver!. Plus, this is good exercise for both of us, with my husband chopping it, and I carrying it and stacking it.
3. If we have a power failure when there is four feet of snow outside, we can always have a wienie roast indoors!
I have had gas fireplaces in the past, btw, and I hate them -- imo, they have no personality and some of them generate too much "local" heat, but -- again -- I think these are one of those things that are a matter of opinion. I know many people think and feel as I do, but I also know that many others definitely prefer gas.
P.S. You are absolutely right about restrictions -- we have them in Colorado -- but it is not an issue in Maine or rural New Hampshire, or at least not that I have ever heard.
If the wood burning fireplace is non-negotiable, I would investigate those otherwise perfect houses. We used to have a wood burning fireplace that we installed gas logs in (it had a gas line already there for a gas starter). I assume we could have taken the gas logs out and gone back to wood burning. The houses you are looking at might have the same thing.
pictures of the home, data points like "direct vent" or "ventless", and the professional assistance of your Realtor will help you get a wood-burning fireplace.
as to the original question, I would much more be thinking about keeping that "not my long-term home" as an investment. That assumes it's better to accept rent than to pay taxes.
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Cold, remote
