Taking advantage of today's beaten down home prices and record-low rates, baby boomers are buying their dream retirement homes -- years before leaving the workforce.
Fortunate enough to take advantage of today's beaten down home prices and record-low interest rates, some baby boomers are buying their dream retirement homes -- years before leaving the workforce.
"We're seeing people purchasing homes five, six, seven years or more ahead of retirement," said William Filbin, a Re/Max broker in Marco Island, Fla.
It's an opportunity that's hard to resist: Home prices nationwide are down 32% from their mid-2006 peak, according to the S&P/Case-Shiller home price index. Meanwhile, mortgage rates are at historic lows with the 30-year fixed-rate hovering around 4.2%.
The question is: What to do with the property when you have so many years to kill before retirement?
To help cover the expenses of an extra mortgage and other bills -- like utilities and property taxes -- some pre-retirees are renting their homes out on long-term leases; others who bought in vacation hot spots rent to vacationers, said Mike Sannes, a Keller Williams broker with Big Bear Real Estate in San Bernardino County, Calif.
It doesn't always cover all the costs, but it helps.
By Les Christie - Last updated September 19 2011: 8:01 AM ET
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