Look Before You Leap
Kyle McIntosh | Sep 3, 2021
A FEW WEEKS AGO, fellow contributor Dennis Friedman discussed how he’ll remain in California for retirement, despite the lower cost of living elsewhere. Dennis’s post got me thinking about the conversations I hear at my local dog park in Newbury Park, California.
A local realtor regularly talks about the many longtime homeowners who are moving out of state. Within days of listing their home, sellers receive multiple offers above asking price. The sellers then move to places like Arizona, Idaho, Utah and even North Dakota.
While I appreciate the rationale for selling in a hot market, I hope that those leaving California have asked themselves these three questions:
- How’s the weather? We recently completed a cross-country road trip along Interstate 40 from California to South Carolina. During our three-week trip, the best two weather days were the first (when packing the car) and the last (when unpacking the car). While there’s something to be said for having seasons, those planning to leave California would likely be well-served by digging into historical weather data for their new location.
- Where’s Trader Joe’s? There are downsides to living in densely populated areas. Still, I’ve grown used to having so much available to us within a small radius of our home. While there are benefits—such as less traffic—to living in a less crowded area, those departing should consider the longer driving distances to doctor’s offices, grocery stores and (gasp) Starbucks.
- What’s the overall tax impact? While most leaving California will benefit from lower income taxes in other states, many could see a significant increase in their property taxes. Another potential tax downside for some sellers: Their home-sale profit could be subject to federal and state capital gains taxes.
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Those are all good points stressing the need for due diligence before making such a move. I live in the hot, humid South (NC). July and August here can be brutal, but Fall and Spring are fantastic and we have mild winters. July and August here are why they make air conditioners. We have a term here for some newcomers, “halfbacks”, which refers to people that move from the North to Florida, discovere they miss the 4 seasons, and move halfway back to NC. We have a lot of them!.
I, too, live in North Carolina. I hate the summers, but agree that spring and fall are fine (and beautiful), and the winters, down here in the flatlands, not much of a problem. We have low income taxes, low property taxes, and we definitely have Trader Joe’s. Plus, these days, a remarkable variety of restaurants. I’m also a couple of hours from the beach and three or four from the mountains. (Although it’s true I prefer my coastline rocky rather than miles of golden sand, YMMV.)
~ I went to Thousand Oaks HS. It’s a fantastic area to live in.
~ Between wild fires and unusual weather patterns, it’s been a strange couple of years… but it’s hard to deny that California weather is nice.
~ There are all sorts of considerations for retirement; it can be hard to know if you’ll like an area and some due diligence ahead of time seems a good idea. We live in Colorado, and it’s pretty great too. We’ve considered Arizona, Minnesota, and many places in between, but there’s a real good chance we simply stay put.