Regardless of when the economy turns back around, the financial crisis has put just about everyone’s retirement lifestyle picture a little bit askew. If there is any silver lining, it just might be that it forces us to look at the retirement paradigm in a new way.
Common wisdom and AARP surveys show that at least 80% of people would like to retire right where they live now. The problem is, most of us moved into our homes with different lifestyle requirements than what we have now. Whereas we were once looking for more room for our families, a smaller footprint (with reduced energy consumption and property taxes) might be more appropriate today. Another consideration is that our future mobility will not be what it once was. So if we are to stay in our homes, remodeling them to fit our future might be a good idea.
The downturn in the housing market presents an opportunity for those with the means to remodel now. There are plenty of contractors looking for work, and materials prices have fallen considerably – it’s a good time to be remodeling. Interest rates are near historic lows for qualified borrowers. Plus, if you have the resources, it’s a patriotic gesture to make!
Remodeling a home for a dream retirement will differ from person to person, but building a first floor master suite would be at the top of most retired people’s lists. New kitchens and bathrooms are usually the top remodeling projects in every home, and they make sense for retirement homes as well. Making the home more accessible – removing steps and level changes, changing out door knobs for handles, widening door openings, etc. – are universal improvements that make sense for any home. Converting spare bedrooms to offices or hobby rooms, planting easier to maintain landscaping, changing to easier maintain exterior materials, installing energy efficient appliances and solar hot water systems – these are smart options to make your house more livable while reducing future work and expense. Remodelormove.com has an interesting remodeling vs. moving calculator you can use to help you determine which option makes sense for you (worth a look just for the questions it asks you).
In our opinion renting in an active adult community or retirement town has always been a good idea. For a relatively small investment you get the experience of living in a community without any risk. If you love it, you get insight into what and where you will buy. If it seems like there are greener pastures, it’s nothing to move on. As with remodeling, there has never been a better time to rent. So many homes are sitting on the market that rents are competitive and the choices are numerous. You can to places like forrentbyowner.com or vacation rentals by owner and find great selections just about anywhere. Or you can contact active adult communities directly.
Another option, rent-to-own, was announced recently by the luxury home builder Toll Brothers. In their efforts to introduce new buyers to their communities Toll Brothers will now rent homes with an option to purchase in several markets. With no or limited complications, you get the advantage of living in a condo or town house before you decide to buy it. The program is available in New York City, Singer Island (FL), and Scottsdale AZ. You can always try to negotiate rent-to-own with other builders and see what happens. Many individuals who are stuck with an second or third home will also consider rent-to-own. The deal you strike is only limited to your creativity and negotiating skills.