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Retirees move to less taxing climes

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Steven Ramos, a retired letter carrier, estimated his cost of living would drop 80 percent when he moved from New York to a rental community in central Florida.

In 12 years, Ramos saw the taxes on his modest 1,200-square-foot house in Queens rise from $1,400 a year to almost $4,000, and other bills climbed as well.

"The increases are insane," Ramos said. "In the wintertime, we're pushing $400 to $500 a month to keep the house warm." So off to Nalcrest, Fla.

Retirement moves, which dropped sharply during the worst of the recession, are making a comeback.

Florida, the top draw for movers 55 and older, is gaining about 55,000 older movers each year, more than twice the growth it saw after the housing bubble burst in the middle of the last decade, according to a Stateline analysis of Census Bureau numbers. Florida's annual growth for this age group is 138 percent.

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Arizona has seen an 18 percent increase in retiree moves and South Carolina 6 percent, as an average of annual moves in the post-recession years of 2009-2012 compared to 2006-2009.

The 55 and older category is often used by researchers because people tend to be thinking of retirement when they make long-distance moves at that age, though they could still be moving for job transfers or other reasons.

Low cost of living and warm weather are prime draws for retirees. They tend to move from colder or high cost states such as New York, Illinois, New Jersey, Michigan and California, in search of warmer and lower cost states including Florida, Arizona, North and South Carolina and Texas. Many of the destination states also have relatively low property taxes — for instance, South Carolina's median annual property tax bill is just $769, compared to more than $7,000 in New Jersey.

Ramos and his wife, like many, put off a move because of the recession. "The bank gave us a hard time. We should have been out of here a long time ago," Ramos said.

The top five most popular cities for seniors have all seen increases since the recession ended in 2009, according to a study by William Frey, a demographer at the Brookings Institution. They are the metropolitan areas around Phoenix; Riverside, Calif.; Tampa-St. Petersburg, Fla.; Atlanta; and Denver.

"An emerging senior boom is boosting not only traditional retirement destinations but also emerging ones in the Southeast, Mountain West and Texas," Frey wrote. "Florida and Arizona are coming back even bigger in the post-recession period, with some falloff for Texas."

Some of those booming markets require caution.

John Burns Real Estate Consulting, a prominent housing market analysis firm, notes a buying boom around the country by older Americans whose stock portfolios recovered from the 2008 crash. But the group is wary about "hockey-stick markets" like Phoenix, Las Vegas, Riverside and Tampa where prices fell drastically and "came back too far and too fast" when investors scooped up properties. (Picture the business end of a hockey stick.)

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Because of speculative price increases, "the markets there have gotten more challenging for the people who really want to live there," said Chris Porter, chief demographer at Burns.

Recreation for today's younger and healthier retirees is a big consideration — from the mountaineering and four-wheeling popular in the West to the bicycling, motorcycling and farming enjoyed by Kathy Merlino and her husband in South Carolina.

"We moved from Michigan — high taxes, hard winters and high unemployment," said Merlino, who now blogs on retirement after a career in banking and real estate.

"I saw people moving here from Florida in droves. I called it 'the Florida Trail,' as people had retired from the north to Florida, which was the tradition, only to find they disliked the extreme heat," she said.

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