Periodically, I traverse our long island roads and head to Lowes, Home Depot, Consumers, Ikea, and furniture stores, like Raymour and Flanigan, Seigermans (where I had bought furniture 25 years ago) Bob’s Discount Furniture and Ikea over the course of about 10 days.
I had created my own survey made up of questions, such as to what people were purchasing and why, their budgets for upgrades and improvements, how long they have been in their homes, and at what point they might consider selling or either downsizing or upgrading in purchasing their next home; as well as at what point or timeline they had in mind when they might considering retiring and either staying in New York or leaving to other warmer destinations altogether.
My pertinent and probing questions gave rise to not only why they were doing those upgrades and improvements, but did they believe that what they were doing would garner a greater return?
The answers were varied, but consistent in the fact that besides answering my basic improvement questions and thoughts of downsizing or upgrading to a larger home; one of their major concerns they conveyed to me, had to do with when they were going to retire, if at all and if it would be as comfortable as their parents had been experiencing.
The fact that they were planning to work longer into their senior years or were already doing so, proved to me that a majority, either didn’t save enough for an anticipated longer retirement period, based on current statistics or they just wanted to keep active and working and be healthy (getting out of the house, so as to not deal with their wives and I heard the same response from women too about their husbands).
This reduced conflicts when they were out working and it was also more enlightening and fulfilling as one retired contractor told me at a Home Depot.
He said, “I’m somewhat comfortable because my wife was a tier one teacher and had retired with a hefty pension and that he wanted to continue, if just for the other side benefits and perks; although his wife had medical and dental benefits for both of them.
We also had more to talk about in the evenings. We are all paying for those excellent benefits in our school taxes, which are some of the highest in our nation. He appeared to me to be somewhat comfortable financially as my questions kept probing as tactfully as possible, to know why he kept working.
Keeping busy and earning additional income, while collecting social security (do you know that each year from 65 to 70 that you do not take your Social Security, the system provides you with an overall 8 percent bump above your normal benefit, each year that you delay collecting.
So while the system can pay out, you would receive a total benefit of 140 percent of what you would have received if you began collecting at 65. But then you would have to live to approximately 80, to be ahead of the game.
In this fashion, it enabled him, to keep active and have a more productive life and have a purpose in getting up each morning as he did in his own business for over 35 years. Working for a major corporation enabled him and his wife to save additional money enhancing their retirement years.
The upgrades and improvements were for their personal enjoyment and benefit and had less to do with selling their home. Years ago there was an article in Newsday about the “graying of Long Island” and it is obvious, that those that have not left and decided to stay because they love Long Island and New York, are growing older and more gray or white-haired!
They are the fortunate ones that have enough savings and investment income to be comfortable financially; but a portion of those I spoke to spend four to six months in the southern states of North or South Caroline, Georgia or the most favorite, Florida.
However, adding to the still low housing inventory today was the fact that many stay put because their children are nearby. However, their response to me would be, “I am not selling and we will let our children decide to sell or to rent out our home, when we are gone!
I have experienced this situation with several customers, who asked me whether to sell or to fix, upgrade and then just rent for positive cash flow. My answer in certain instances was, absolutely.
Since they are not growing anymore, the investment value is number one in my book and its’ value doesn’t change as suddenly and drastically and react to bad news as the stock market always does.
Now, many Brokers and agents may not want to agree with me or follow my path; but if you were a CFP (certified financial planner), wouldn’t it be your legal duty to advise and consult your clients to receive the best return on their money?
Well, that is how we work in guiding parents and children to realize the best return on their housing investment, based on the risk tolerance and determining whether or not they want to be in the landlord game. However, one must ascertain what capital gains, if any would have to be paid when selling your parent’s home, depending on what type of trust or will your parents had.
We believe “paying it forward” and giving more in consulting our client sellers, investors, purchasers and renters will always come back to us in a positive way and that’s the only way we work to benefit our homeowners and consumers.
Philip A. Raices is the owner of Turn Key Real Estate in Great Neck. He is a Graduate of the Realtor Institute (G.R.I.) and also a Certified International Property Specialist (C.I.P.S.) He can be reached by email: Phil@TurnKeyRealEstate.Com or by Cell, (516) 647-4289 to answer any of your questions. To search for property, see what your home is worth or homes that have sold in your area, go to:
WWW.Li-RealEstate.Com or we can provide you a free CMA (Comparative Market Analysis) absolutely “free” without obligation and no strings attached!
