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With house prices this high, boomers may want to become renters
Marketwatch ^ | 07/08/2023 | Brett Arrends

Posted on 07/08/2023 8:36:09 AM PDT by millenial4freedom

If you’re a retiree and you’re trying to square the circle of rising costs, longer lifespans, more expensive medical care and turbulent markets, don’t be afraid to run the numbers on your biggest investment.

That would be your home — if you own it.

U.S. house prices are now so high that it is almost impossible for seniors not to ask themselves the obvious question: “Should we cash in, invest the money, and rent?”

Right now the average U.S. house price is nearly $360,000. That’s about a third higher than just a few years ago, before the COVID-19 pandemic. The lockdowns, the panic, the stimulus checks and 2.5% mortgage rates have all passed into history. But the sky-high prices remain — for now.

At these levels, analysts at Realtor.com — which, like MarketWatch, is owned by News Corp. — say that in 45 out of 50 major U.S. metropolitan areas it is cheaper to rent than it is to buy a starter home. The Atlanta Federal Reserve Bank says national housing affordability is abysmal — about where it was in 2006 and 2007, during the big housing bubble.

(Excerpt) Read more at msn.com ...


TOPICS: Business/Economy; Chit/Chat; The Guild; Weird Stuff
KEYWORDS: boomers; economy; finance; homeowners; housing; inflation; realestate; realty; renters
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1 posted on 07/08/2023 8:36:09 AM PDT by millenial4freedom
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To: millenial4freedom

This divorced mother-of-two boomer has been a renter her whole life. I’ve never owned a home. Couldn’t afford one, or the maintenance when my two sons were small, and once they left the nest, there was no reason to own a home.


2 posted on 07/08/2023 8:37:59 AM PDT by mass55th (“Courage is being scared to death, but saddling up anyway.” ― John Wayne)
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To: millenial4freedom

This boomer owns his house outright.


3 posted on 07/08/2023 8:38:51 AM PDT by GingisK
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To: millenial4freedom

Try vacating the urban population centers. Prices are more normal.

Salaries are lower but the cost of living may be less than half.

Poor little snowflakes can’t even think for themselves anymore.


4 posted on 07/08/2023 8:38:58 AM PDT by ImJustAnotherOkie
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To: millenial4freedom

BlackRock approves.


5 posted on 07/08/2023 8:40:22 AM PDT by E. Pluribus Unum (The worst thing about censorship is ████ █ ██████ ███████ ███ ██████ ██ ████████. FJB.)
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To: millenial4freedom

How can Boomers own nothing and be happy unless they start renting?


6 posted on 07/08/2023 8:40:44 AM PDT by 9YearLurker
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To: E. Pluribus Unum

They probably wrote this tripe.

The grinch coos to the innocent Whos of Whoville...just give up your miserable little manses, my darlings, and let me take care of all your problems...


7 posted on 07/08/2023 8:51:56 AM PDT by Regulator (It's fraud, Jim)
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To: millenial4freedom

The nice thing about renting is that you don’t pay property tax.


8 posted on 07/08/2023 8:53:26 AM PDT by BobL (Trump has all the right Enemies; DeSantis has all the wrong Friends)
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To: millenial4freedom

I’m not sure this makes sense for a lot of people.

If you own a home free and clear and have no mortgage payment, does it really make sense to cash out, invest the proceeds ,but then have monthly rent? Rents will only continue to increase year by year into the future.

If you own a house but have a mortgage, if you have a fixed rate mortgage and a fixed payment for years into the future, why would you trade that fixed payment for renting when rents are only going to increase your by year into the future?

It seems to me that this idea may work for certain specific people in certain specific circumstances , but a lot of people will not get any benefit from doing this.


9 posted on 07/08/2023 8:53:44 AM PDT by Dilbert San Diego
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To: All

I would hope that most boomers own a home outright. If that’s the case, I don’t understand what sense renting makes.


10 posted on 07/08/2023 8:53:51 AM PDT by FLNittany (Autotune is jealous of Karen Carpenter)
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To: BobL

You do indirectly, as it’s factored into the rent.


11 posted on 07/08/2023 8:54:55 AM PDT by dfwgator (Endut! Hoch Hech!)
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To: BobL

You are indirectly paying the property tax for your landlord. Your landlord paid the property taxes, and all the tenants helped pay the those taxes along with other operating expenses of the property. Your rent is higher than it would be otherwise to help the landlord afford the property taxes.


12 posted on 07/08/2023 8:55:31 AM PDT by Dilbert San Diego
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To: dfwgator

“You do indirectly, as it’s factored into the rent.”

I know, of course. I just like to have some fun here once in a while.


13 posted on 07/08/2023 8:56:32 AM PDT by BobL (Trump has all the right Enemies; DeSantis has all the wrong Friends)
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To: millenial4freedom

We two boomers own our home outright. Renting makes no sense.

Selling would not make sense because we could not get enough for it to buy another home.


14 posted on 07/08/2023 8:59:59 AM PDT by madison10
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To: Dilbert San Diego
If you own a home free and clear and have no mortgage payment, does it really make sense to cash out, invest the proceeds ,but then have monthly rent?

No...Most who own their homes are older folks who don't have 20 or 30 years to sit around hoping some investment/gamble scheme pays off.

15 posted on 07/08/2023 9:02:02 AM PDT by dragnet2 (Diversion and evasion are tools of deceit)
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To: millenial4freedom

With house prices this high, boomers may want to rent out a room by the week for extra cash?


16 posted on 07/08/2023 9:03:54 AM PDT by Leep (What skill or service did the biden family have that netted them tens of millions of dollars?)
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To: millenial4freedom

Our home is fully paid for, and we’re keeping it. Better to have something physical than the money in a bank.


17 posted on 07/08/2023 9:06:48 AM PDT by KittyKares
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To: millenial4freedom

Of course rents are through the roof. So that’s not much of an answer either.


18 posted on 07/08/2023 9:09:00 AM PDT by discostu (like a dog being shown a card trick)
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To: BobL
The nice thing about renting is that you don’t pay property tax.

Sure you do. You pay your Landlord's property tax.

19 posted on 07/08/2023 9:09:26 AM PDT by Freedom_Is_Not_Free (America -- July 4, 1776 to November 3, 2020 -- R.I.P.)
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To: Dilbert San Diego

I’m not sure this makes sense for a lot of people.

If you own a home free and clear and have no mortgage payment, does it really make sense to cash out, invest the proceeds ,but then have monthly rent? Rents will only continue to increase year by year into the future.

If you own a house but have a mortgage, if you have a fixed rate mortgage and a fixed payment for years into the future, why would you trade that fixed payment for renting when rents are only going to increase your by year into the future?

It seems to me that this idea may work for certain specific people in certain specific circumstances , but a lot of people will not get any benefit from doing this.


You are correct on all of the above. The only time selling and then renting would make sense is if you are downsizing a very large house to move into much smaller rental property. The other aspect would be if you are also going to move from a high cost area to a low cost area.

I think the argument presented in the original article was a bit simplistic in arguing that it would make sense for most people based on the bubble price of housing.


20 posted on 07/08/2023 9:20:10 AM PDT by Steven Scharf
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