Renting Vs. Buying In Retirement: Why I Decided To Do Both

As you consider retirement or semi-retirement, you’ll give serious consideration to whether to rent or buy if you don’t stay in your family home.

Especially when considering overseas retirement, where the U.S. dollar may stretch further, it’s important to give special attention to each possibility.

• Do you know with certainty where you want to live forever? Or do you want to explore the world? 
• Do you have family somewhere that you want to be near? Or maybe you have multiple family members you want to see throughout the year?

Each lends itself to one choice or the other.

Coming Up With A Plan

The most judicious thing to do when you start considering the moves you’ll make during retirement is to create your own Pros and Cons list based on what matters to you most.

Climate? Cost of living? Availability of healthcare? Proximity to family? Beach life? Urban culture? All matter.

As you create your own top 10 items that matter the most to you in retirement, you’ll develop a better idea of where in the world you’ll want to live.

But there are options within options that need to be explored.

Do Your Research

One of the choices you get to make is whether you’ll do your research from the comfort of your own armchair or get out on the road and “try” out places.

If you’ve decided, for example, that you want a great climate and good beaches, you’re bound to consider the Caribbean.

But what about Thailand and other parts of Asia? They could be a great fit for you, too.

You can access information online by checking social media and YouTube but it’s a lot more fun to go visit.

Where I Went And Why

For me, I started with Dublin. My daughter graduated from Trinity College — Dublin and we’d purchased a tiny home a block from school. We renovated the kitchen immediately and then were blocked from travel during the pandemic.

So that was our first purchase.

While unable to travel to Dublin, I went to the easily accessible Central American country of Belize and rented for a couple of months.

I’d received information from expats who lived there and took their advice. Starting in Ambergris Caye and having all imaginable fun, and then moving to Placencia where the peacefulness of the village exudes from its pores.

I chose to rent in Placencia, both for the peace and for potable water. Turns out that needs to be on my Pro/Con list. Bottled water may be necessary but leads to other challenges.

What Worked

Purchasing the Dublin apartment will ultimately work out. It was purchased outright, with cash, so the expenses are extremely low, just utilities and property taxes and management fees.

A contractor was recommended through a friend of a friend and our kitchen remodel was done a little over time and a little over budget. Well within the timelines we allowed for our U.S. remodel.

I’ve now purchased a condo in Panama and that will serve as my winter home.

What Didn’t Work

Turns out one winter in Dublin was sufficient to learn it’s not my favorite time of year. While I absolutely can go and enjoy the winter activities, especially when you leave the city center, I prefer a little warmer climate than “Where many are cold, but few are frozen” — thank you, Tommy Graham.

The pandemic put a wrench in our additional renovations. Despite the recommendation, the new contractor didn’t do the work and we returned to find our locks had been changed and many items damaged or missing. Not being able to be onsite for 14 months cost us thousands of euros.

What I Learned

When we purchased the Dublin property, we learned a lot about how things are done in Europe. While the sale can occur in a pub with a handshake, going through the proper channels with a solicitor and an inspection allows you to adjust your expectations. It’s important because the owners won’t change the price or make any concessions. You’re buying the property as it is.

Different country’s laws need to be explored through local solicitors.

And the cost of visas should be considered.

What I Would Have Done Differently

Knowing what I do now, I would not have hired the second contractor to work on the home. If I had suspected that the delay to get back into the country was going to be so extended, I would have rented it as is and received a rental income during the pandemic.

More generally, I would have found a way to divest myself of more household goods earlier. Paying $1,000 per month for storage? That’s a plane ticket. Or a month’s expenses at both homes.

What Surprised Me

The thing that surprised me most was probably how easily I adjusted to life in Placencia, Belize. I could still go and do active things, like sport fishing and scuba diving and river tours, but enjoyed the peace of the peninsula from the little island where I lived.

That time gives me great hope for life in Panama where my beach town remains under construction with Huntington Beach, California, from the 1950s as its model. With the internet and other modern conveniences.

An inconvenient surprise was the difference in time zones. When my daughter returned to the U.S., she was on PST which is 8 hours behind Dublin. That’s a challenge. 

The bad surprise was how little the Garda, Ireland’s police, cared about my loss of property. They’re very strict with bodily injuries but expect the solicitors to deal with the rest. The second contractor has never refunded my money or faced any charges.

Tips For Others Deciding Whether To Rent Or Buy In Retirement

First, make your Pro/Con list based on what makes you most comfortable in your daily life.

Here are a couple I didn’t know were important to me at the beginning:

Do you need to have a car or are you happy walking everywhere with an occasional taxi?

Do you mind all the effort entailed with the need for bottled water?

Second, at least visit a new destination and check out the neighborhoods before you commit. It is often better to rent first before you buy.

Third, consider how often you want to see your family. The advantage of Central America is twofold: the ease of flights to the U.S. and the proximity of the time zone. Communicating with your family on a 1- or 2-hour time difference is a lot different than an 8- or 20-hour time difference.

Finally, just go. Check out new places and have a grand adventure. Whether you rent or buy, you’ll be glad of the journey.