Moving Mom Monday: Downsizing Baby Boomers – Is It Better to Rent or to Buy?

Baby Boomer Couple Talking with Financial Advisor

In the Washington Post article Downsizing baby boomers face a key decision: Is it better to rent or to buy?, author Michele Lerner writes that the rent-or-buy decision affects people nearing retirement:

“The rent-or-buy decision is more commonly thought of as a dilemma for young professionals establishing their households, not people approaching retirement. But whether it’s a financially savvy decision or simply the only solution when they can’t find a suitable place to buy, some baby boomers are choosing to rent an apartment downtown when they downsize.”

Some advice:

“Understand your goals. Many baby boomers who think they want to downsize into a city condo are surprised that it will cost them as much to buy a condo as they would pay for a house, says Ellen Sandler, a real estate agent with Evers & Co. Real Estate in Washington. ‘Some decide to rent to get the services and lifestyle they want, especially if they have enough assets to throw off enough income to pay the rent,’ Sandler says.

Investment options for renters. Tim Hewitt, a senior wealth adviser with the Wiley Group in Conshohocken, Pa., as well as a licensed real estate agent with United Real Estate in Wayne, Pa. says that 80 percent of his clients don’t want to rent because they don’t want to lose control over their home to a landlord and don’t want the possibility of paying higher rent in the future. ‘Those clients that choose to buy tend to make a large down payment or buy with cash from the equity from the sale of their home. and then try to cover their property taxes, insurance and maintenance costs with their Social Security or pension income,’ Hewitt says. ‘They can use their investment income for discretionary spending.'”

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DAYNA WILSON: As a real estate agent I have been working with homebuyers and sellers throughout the East Bay communities of Layfayette, Moraga, Orinda and Walnut Creek since 2009. As a Certified Senior Housing Professional (CSHP) , I have special knowledge about everything from reverse mortgages to the importance of universal design. I can tap into my network and put you in touch with my team of qualified home inspectors, movers, attorneys, CPAs, organizers and other experts. I have all the resources and knowledge to simplify the transaction and eliminate the anxiety of selling your home.

Call me today to talk about your real estate concerns. I’m here to listen: 925.788.6582