Owning a home in retirement can create financial stress instead of security. Pla2na/Shutterstock
Although owning a home has been thought of as a nest egg, for some people, owning a house in retirement can be a liability. It can cause cash-flow problems and high debt. Depending on the real estate market, illiquidity may be a problem. This could cause a shortfall in available funds to finance retirement. Aging in place may come at a high cost as well.
There are many pitfalls to owning a home in retirement. It’s important to be aware of them so you can make an informed decision as to whether to stay in your home.
Affordability and Cost Burden Hinders Cash Flow
The cost of home ownership continues to rise. According to the United States Census Bureau’s American Community Survey (ACS), in 2024, the median monthly costs for homeowners with a mortgage was $2,035. This was an increase from 2023 when it was $1,960.
Homeowner’s Insurance Contributes to Cost Increase
Although this number is based on several costs, it primarily increased due to mortgage and homeowners’ insurance. According to Pew Research, 71 percent of homeowners say their home insurance cost have increased in the last few years.
