Maybe it was the gray hair, the years of experience, or just being in my late 50’s that helped introduce me to clients who are transitioning into retirement and are downsizing.
The baby-boomer retirement plan was accelerated by “Covid-19” as long time owners found the old house was just too big. The retirement dream became clear.
Deciding to retire is complicated, but figuring out your next lifestyle shouldn’t be held back because of your current house.
For many people, who already have a second home by a lake, near the beach, or in the mountains, the plan may have been to slowly retire here or then spend six months there.
But if you aren’t someone who planned this situation out twenty years ago, you are going to need to do some exploring. This is an exciting opportunity to experience living in places you have vacationed or visited before and enjoyed.
Make a list of the top ten places and start reading about them online.
The reality is that those places may have been discovered, and aren’t like they were back in 1994. The sleepy farms with open-air farmstands selling corn and fresh pies may now be the newest housing development and shopping center… catering to retirees who all look just like you!
Transitioning into Retirement
Start with an Airbnb or VRBO short-term rental
An important tip my retiring clients have eagerly shared has been staying in a town or community for a month with Airbnb or VRBO. These are short-term experiences where you can live the lifestyle like a local, meet people, and sense the community’s vibe.
After two weeks, you’ll get a feel for traffic, shopping options, good places to hike, enjoy the outdoors, and volunteer.
Best of all, after a few weeks in an Airbnb and you’ll have a much better understanding of the lifestyle.
Make a quick list such as:
- Are there golf, tennis, or activities?
- Is there a beach?
- Hiking or biking trails?
- Museums, or National Parks?
- Is there a hospital or university?
- Are there volunteer opportunities?
- Will friends and family want to visit?
- Are there part-time jobs?
I mention part-time jobs because friends have done jobs like running a ski lift in Colorado, working as a hostess in a trendy restaurant, or volunteering at the hospital or in local government.
These are worth looking into. Your life experience is valuable and will help you meet people.
Have options, plenty of options.
Downsizing from your home
Downsizing doesn’t always mean a smaller home, but one with a bedroom on the main level or with a smaller yard.
We collect things over our lifetimes which may be in your living room, stored in cabinets, boxes in the basement, or stuffed into an expensive storage unit across town.
Downsizing will force you to donate things, give furniture or artwork to your children, sell a few things, or have the junk finally hauled away. The remaining keepsakes will come along for the ride into your new home.
Yes, this is a project that will help prepare your current home for sale so take it seriously.
It’s a Competitive Real Estate Market (everywhere)
Finding an available home where you have decided to move is going to be hard, and stressful.
Prepare yourself to be outbid as other people jump at homes to buy with offers over the asking price. This is happening across the country, especially for homes that appeal to retirees.
In a recent article (2022), Zillow’s national real estate statistics showed the inventory of available homes for sale was down almost 50% over historic averages. Builders are behind schedule and homeowners are staying put rather than move to away.
I’ve seen the marketplace and It’s painful, and here in the Vienna real estate market, there are fewer homes hitting the market too.
Homebuyers are making offers based on online photos without ever personally seeing the inside of the house. Their first time may be during the final walk-through inspection before closing on the home.
Preparation is essential, so, you must consult with a professional to help focus which will save time and essentially make you a more competitive homebuyer.
Sell then buy, or Buy then sell?
It is important to know where you want to be with a month’s stay or two in an Airbnb in the summer, fall, and winter. At this point, you can identify ideal areas, neighborhoods, or architectural styles. Most of my clients use apps like Zillow, Realtor.com, and RealScout which pick up “coming soon” properties too.
Each client has a unique set of financial circumstances and putting a plan around your equity, cash on hand, and financing is very important. When properly organized and presented with an offer, even an offer with financing (even VA financing), you can beat out a cash offer.
Be careful and examine transaction fees behind anyone or company who advertises they can help you become a cash buyer. Fees will be included in the post-settlement flip into your name so it’s important to read the fine print.
Stay within Budget
It is hard not to get caught up in the frenzy these days of buying a house.
Today’s issue is rapid price appreciation and mortgage interest rates. With the increases I have seen since January 2022 in mortgage rates, your budget may have already taken a hit.
Look outside the box and not only in the super-hot location you have pictured. Yes, do your research on communities because you may discover a location in person that others haven’t on the favorite real estate App.
Finding a new home when you are transitioning into retirement does require a plan. Relax, there is no rush so take advantage of today’s easy availability of short-term rentals thanks to Airbnb or VRBO.com and live a little as you comparison shop for a community that fits your lifestyle.
