Posted on 09/05/2025 7:55:36 PM PDT by SeekAndFind
Dear Chuck,
My parents are retired and have a very low interest rate on a small amount of remaining mortgage. They told me they want to sell their home and rent, thinking they will save money. I am gathering information to help them. Would you suggest they rent or keep owning their home?
Retired: Rent or Buy?
Dear Retired: Rent or Buy?
It depends. I don’t have the full financial picture of your parents, so I don’t want to give advice based on false assumptions. Let me disclose a few assumptions from your question:
Renters by choice
Many people who are 55 and over desire financial flexibility. Rather than having the majority of their money tied up in a home, they prefer to rent. They realize a home is not the most liquid asset.
Some no longer want the responsibility of maintenance and repairs. Losing a spouse, physical limitations, and the desire for a more flexible lifestyle can play into the decision. I call this “renters by choice.”
Prepare for a deeper conversation
Try talking with your parents about their financial situation, desired lifestyle, and long-term goals. Have they personally sought wise counsel — especially from those who are older than themselves? Are they seeking financial margin due to consumer debt or medical expenses? Do they have a lien against the property? What is the driving force?
If the home is paid for, how do they plan to use the equity? Will they have to pay capital gains taxes? Have they considered downsizing to a low-maintenance housing option, in which case HOA fees must be considered. My wife thought she found an incredible deal on a condo until we discovered the fees were outrageous. If they want to rent, can they support that lifestyle indefinitely? Are they healthy? What is their life expectancy? What sources of income do they have or expect?
Growing trend
FoxBusiness.com reports that renting is a growing trend among those 55 and older. Rising property taxes, insurance, and repair costs are major factors. People want a simpler life so they can pursue traveling and hobbies. Some find it lonely (and expensive) to occupy the big homes in which they raised their children. The widowed, single, or divorced sometimes desire a community that their home or neighborhood may not provide.
Insurance is up
Consumer Federation of America: Between 2021 and 2024, property insurance premiums rose an average of $648 a year. Premiums increased in 95% of U.S. ZIP codes, with a third increasing more than 30%.
Taxes are up
National Association of Realtors: Taxes have increased across all states. The national median annual real estate tax surged by 23% between 2019 and 2023. It represents 4% of the median annual household income. Twenty-seven states recorded hikes of 20% or more, with Florida experiencing the largest rise, followed by Wyoming, Louisiana, Indiana, Georgia, and Utah.
The following information is for anyone, regardless of age, when deciding whether to purchase or rent a home.
Pros to buying/owning
Pros to renting
Cons to buying/owning
Cons to renting
Whether buying or renting, housing costs should not exceed 30% of one’s monthly income. Analyze objectively, not emotionally, and compare apples to apples. Costs are in the details, like age of structure, square feet, lot size, location, etc. Most experts advise against buying if the owners do not plan to be there for a number of years to recoup the costs. My rule of thumb is to plan to stay at least five years.
Redfin suggests answering the following questions:
Helpful Zillow articles:
Remember, this is not our home
“In my Father's house are many rooms. If it were not so, would I have told you that I go to prepare a place for you? And if I go and prepare a place for you, I will come again and will take you to myself, that where I am you may be also” (John 14:2–3 ESV).
Keep an eternal perspective when you talk to your parents, being mindful of three financial milestones: making it to the end of the month without running out of money, making it to the end of life without running out of money, and preparing to stand before the Lord to be evaluated for stewardship. Talk to them about each of these milestones, and see what is on their heart.
Hopefully, you can support them and help them whichever way they decide to go.
Walking through a functional budget is a good place to start, and Crown has free tools that can help. We also offer a variety of calculators that can help with making financial decisions.
Chuck Bentley is CEO of Crown Financial Ministries, a global Christian ministry, founded by the late Larry Burkett. He is the host of a daily radio broadcast, My MoneyLife, featured on more than 1,000 Christian Music and Talk stations in the U.S., and author of his most recent book, Economic Evidence for God.
If one is geographically fixed, Renting sux.
Even though the PTB love to tax assets, one is still better off by “owning”.
Heirs also win.
For example they can raise your rent or other fee by no more then five percent a year and that any lesser increase does not mean that it rolls over (ex: they can not raise your rent by 4% for three years and then in year 4 suddenly raise it by 8%).
This agreement needs to be transferable to the next owners.
A number of elderly are finding that when their place is bought out the new owners raise their fees and rent outrageously.
The problem is that as people age, they often can’t - or don’t want to - handle the work of maintaining a house.
We are facing this kind of decision in a few years; I’m thinking of a condo.
My 90 year old mother rents, and has for 30 years. She lives in a 100 year old farmhouse on a 300 acre farm on the Chesapeake Bay. The property is owned by a family that has been friends with ours since 1929. They get a stable tenant who pays a year in advance, and she doesn’t have to worry about keeping things up. She’s still sharp, drives (but only during the day) it’s in her hometown, she has family there, and is active at church, and quilting.
She has deer and turkeys in her yard, and bald eagles across the cove.
It’s a pretty unique circumstance, but if anyone deserves it, it’s her.
I call her everyday for the last 12 years.
Own. No mortgage. Get some.
There is no shortage of peeps/local companies that can be hired to do the upkeep/maintenance one no longer wants to do.
Losing a spouse makes the equation different...
Most these articles are for poor city Democrats.
I retired at age 55, have two houses with ocean views in Hawaii.
All because I did not RENT!
I also did not buy new cars, eat out at fancy restaurants,
or spend my money on the latest Fad.
I went into the military for patrotic and monetary reasons. I eventually earned a STEM degree, not some glamorous “Feel good” womens study or liberal arts education.
Y’all need to sacrifice and plan for your future!
And above all it takes years of work before you can
back off a bit
What a wonderful later-life story! Every parent should be so blessed.
Rents go up
Mortgage payments don’t
I thought about selling and renting when I became disabled.
That $600 Mortgage is about half of what an 2 bed apartment goes for now, 5 years later
Have they considered a reverse mortgage?
https://www.hud.gov/hud-partners/single-family-hecmhome
wy69
Property taxes on my 800k home in Scottsdale is 1300/year
I hardly pay attention its so cheap.
In order for a person to rent out a house they must own the house, which means mortgage, property taxes, utilities, upkeep and hopefully profit. So it should be cheap to buy a house then rent a similar house.
I never owned a home. I was divorced at the age of 32 in 1979 with two sons to raise. When my boys were young, I would have enjoyed having a home, because we had to move frequently. Back then, I couldn’t afford the downpayment, or the maintenance that went with it. By the time I could afford to buy a home, my sons were getting read to leave the nest, and I didn’t need a house. Now that I’m 78, I’m glad I don’t own a home that my sons will have to get rid of after I’m gone. By choice, neither of them has owned a home either.
Owning if at all feasible. But it depends on the person and their circumstances.
This push to get seniors out of their long owned homes that have risen in value so much over the years is beyond disgusting.
I don’t owe ANYONE anything and certainly feel under no obligation to give up what I worked for my entire life to appease some selfish, entitlement mentality minded, ingrate.
They can do what we did. Buy a fixer upper they can afford and work on it themselves and scrimp and save like we did.
Otherwise....pffffttttt....... take a hike ingrates.
I own my own home. The idea of being at the mercy of a landlord is unimaginable. I bought my current house when it was in the beginning stages of construction. I got to choose the color, appliances, cabinets, countertops, the light fixtures and the flooring. I had four plug outlets placed five feet off the ground in the family room and bedrooms so flat screen TVs could be mounted and plugged in without cords snaking up the walls. I asked for extra outlets in the garage and the builder put in 38 outlets. I’ve never had a problem of not enough outlets. I also had a 220 volt outlet put in and a utility sink. 10 years later and I’m totally happy with my house and I don’t ever have to worry about a landlord dying or raising the rent or evicting me.
… those 55 and older …. Kind of rude to describe seniors as being 55 and older. Im 68 and my financial motivations are entirely different from when I was 56. I don’t have any desire to rent when I have a perfectly nice but modest home in a close in suburb of a major city. With a 2% mortgage for 5 more years and Prop 13 protection. Later I may end up renting a room in assisted living but right now I can have a dog and a few chickens and a couple of fruit trees without breaking the bank. I should be able to maintain this lifestyle for 15 more years then I will decide. I will be one of those 80 and older.
Besides a house is not supposed to be a liquid asset. People who refinance and get home equity loans end up with 30 year mortgages at 6.25 percent. No wonder they think they would be better off renting. They have no equity. 450000 home which they pay for at 2500 a month just to stay ahead of the interest. Equity builds very slowly. Then they buy a boat or a giant RV or go on long trips to Europe and Caribbean cruises.
Owning several stately mansions is best.
Regards,
I am 73. Before Katrina, I lived in one of those known in no tell motels on the way to the NOLAAirportinKenner.
Since then, I have moved inland a bit, and have lived in an apartment complex near the VAMC Alexandria. As one of the diasporic VAMCNOLA employees, I was assigned to work there while VAMCNOLA “regrouped/5000 down to 1500. The remainder were informed by email of thei’s and mine fate’.
The motel costs became all the monthly costs for the apartment. Not bad, right?
Well, with the market bumps, the bug affecting prices, and things, today my rent “and processing fee”, are a whole $70, above what my motel bill was...lights, cable, phone are another $300 on top of that.
The funny sad part is that VAMCNOLA Alexandria has shifted a lot of used to do care, to either the big.hospitals downtown or to other VAMC’s out of state.
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