It is easy to assume that owning your own home is always the right thing to do. But as you get closer to retirement, the finances of owning vs. renting can begin to shift. What once seemed like a no brainer takes on new implications, and there are solid arguments in favor of renting once you retire.

Renting after retirement may not be right for everyone, but it should not be out of the question. Here are some reasons why selling your home in retirement could be the right move for your finances and your lifestyle.

The Accumulated Capital Gains Could Finance Your Retirement

It is not unusual for pre-retirees to have most of their wealth in their homes. This situation is so common that financial planners refer to it as house rich and cash poor.

If your net worth is inextricably linked to the roof over your head, selling now could help you unlock that money. If your financial resources are limited but you still want to retire, the accumulated capital gains could help you finance your post-work years. Even if you have significant savings outside your home, selling the property could stretch that nest egg and help you avoid tapping it too early.

Property Taxes Can Be a Killer

The financial burdens of home ownership do not end when the last mortgage check is written. Long after that final payment has been made, owning a home remains a taxing proposition.

Property taxes can be a major burden for homeowners, especially those living on a fixed income in retirement. Many a property has been lost to back taxes, and retirees are at higher risk than their younger counterparts.

The burden of property taxes may be worse in high tax states, but even a modest property tax bill can take a major bite out of your Social Security and pension income. Selling your home now will relieve you of that burden in retirement, so you will have one less thing to worry about.

The Nest is Now Empty

When you were young and raising a family, owning a big home made sense. The kids could have their own rooms, and you and your spouse had room to relax. But now that the nest is empty, that big home could be more of a burden than a blessing.

Owning a big home in retirement can be a real financial burden, not just in terms of property taxes but utilities and repair costs as well. That big home will also take longer to clean, eating into those precious retirement years.

Renting Can Free Up Your Time in Retirement

When you are retired, your time belongs to you, so why not make the most of it? If you would rather spend your time playing with the grandkids, why would you want to mow the lawn instead?

If you would rather be skiing than shoveling snow, renting can free up your time and allow you to truly enjoy your retirement years. Time is a valuable resource for retirees, and the only thing money cannot buy.

Being a Tenant Gives You Flexibility and Makes Moving Easier

Owning a home may be great, but being tied to a set location limits your mobility and reduces your flexibility. If you plan to travel and enjoy life in retirement, renting can restore that lost flexibility.

Making the move from homeowner to tenant can give you additional flexibility and freedom. When it is time to move on, you can simply pick up and put down roots in a new town – or even a different country.

Whether you are on the cusp of retirement or still deep in your working years, where you live and how you live matters more than you might think. For many retirees, renting makes more sense than owning, and it is important to weigh the pros and cons of home ownership carefully.

Thinking About Selling?

At Rise Realty, we offer a transparent, honest quote for your home. If you’re in the process of retiring or have been for some time, choosing to sell your home through traditional means can sometimes take time, and sometimes even money if your home is in need of updates. Before choosing how to sell your home, make sure to give us a call at (972) 433-0236 or submit a free home value analysis.