Empty Nest, Empty Rooms… House For Sale

05/23/2008

Paul Munnis


Once the kids are off and on their own and relegated to sending sentimental cards for Mothers Day then retirement looms. As it does then one pass at the retirement budget makes several things clear.

For one thing you are going to have twice as much wife and half as much money.

This rapidly changes to realization that life now means… Simplify, simplify, simplify.

Simplifying means looking at the roof over your head and discussing things with your wife.

“I don’t want to clean all these rooms that we don’t need anymore.” She has a point and if there are two spare bedrooms soon there will be two more mouths to feed as the kids decide that they can’t face the stress of it all any more (but you can).

You yourself look at the lawn care and snow shoveling chores and think that after 30 years of handling those you could use a break.

Your knees hurt and you realize that the upstairs floor is now surplus space commanding top tax dollar.

That leads to a dinner time discussion about being a snow bird.

So Florida vacations are examined. You realize that buying another house in Florida is far from being retired. It’s just another place for you to maintain. Hotel, motels, and rental units are way too expensive. One then looks to a Florida Park complete with a Parkside trailer model with terms of payment suited to snow-birds. Then the commuting begins. The formula is six months in Florida in order to escape the oppressive Minnesota winter cold and six months in Minnesota in order to escape the oppressive Florida heat of summer.

During the summer you think about the empty Parkside trailer that you are paying for and not using. Then you think about renting it. Then you try but who wants to go to Florida in the summer? Also the Minnesota house is empty in the winter and has to be heated and someone has to be hired to keep the sidewalks shoveled but who wants to rent a house in Minnesota in the winter?

After a couple of seasons of commuting the novelty wears off, the trailer is up for sale, a townhouse in Minnesota is bought in order to be near the kids, and a few strategic winter trips to a warmer climate are planned. Except for the loss you took on the trailer you are back to where you started except you went the long route to downsizing your house.

This is the saga of millions of retirees and it portends a different kind of housing bubble. The one where a large four bedroom home is dumped in favor of a cheaper and more affordable two bedroom and far easier to maintain house.

Retirees love townhouses because they can cluster together in like groups and mingle.

Also, there are the association fees to relieve you from yard care. All in all it’s not too bad except the guy on the other side of the wall is going deaf and his wife screams at him all day.

The alternative is to buy a cute Cape Code style home on a small lot and hire the kid next door to mow the grass. Kids are a renewable energy source.

If all else fails then set up a garden shed and take up home wine-making as a hobby and the shed is a good location for the kit. It gives you motivation to go check the lawnmower out every once in awhile. Beside the Doc says wine is good for you.

Pretty soon we could see a house price inversion, one where the four bedroom units are sold cheaper than what the two bedroom Cape Cod houses sell for. Already Townhouses cost the same as the big two story four bedroom house on the corner lot. The resale market for them is pretty good too with so many Baby-Boomers getting ready for one. Often they are better constructed too.

Everything has changed when the gaggle of Baby-Boomers arrive and likely housing is yet another one of those things to get turned upside down.