The 'Couv'

The 'Couv'

Tuesday, November 24, 2020

2021 Brings Potential Change

 Although Washington State appears to be on track for a continuance of recent policy, the national scene will likely change in 2021 with a new President and a much tighter Congress. Democrats barely hung on to the house and Republicans lost a couple Senate seats. This may lead to a gridlock scenario but should the Democrats manage to snag the Senate (It is possible with two Georgia run-offs in January), things could look a lot different. For middle to upper income retirees, Washington may look even better financially since Joe Biden has indicated an intention to reverse the 2017 tax plan. Living in a state with income tax and paying even more federal tax could lead some retirees to choke on their tax bill. Washington of course, has no state income tax.

Washington State continues to be the northern state best suited to upper middle income and higher income seniors as income tax punishes those with higher incomes. Those retirees with more modest incomes may not feel the pinch in 2021-22 as hard leading to more options for a clean getaway on their taxes. Nearby Idaho can look attractive for some, but Idaho's urban amenities are a touch lacking and the winters tend to be a bit chillier than ours.

For many, Washington State is getting too expensive. Our state is now ranked 4th in the nation for median home price with Seattle leading the way as the 3rd most expensive large city (500k residents city proper) in America, behind, San Francisco, CA and San Jose, CA.

But Washington has a great many areas whereby the housing costs are substantially lower than the statewide median. In fact, Vancouver, WA is the 4th largest city in the state and immediately adjacent to Portland, OR and the median home price is about $390k sitting under the statewide median of about $425k. Clark County, Washington for which Vancouver is the seat of government is at roughly the statewide median and offers the full range from high rise urban condos, to ranchettes and horse properties along with everything in between. 

2021 is just around the corner and hopefully it will be better than this crazy 2020 we are wrapping up.

Tuesday, October 27, 2020

Election 2020 is exactly one week away.

This year many states offered expedited mail in ballot options to help voters cope with COVID-19 concerns about voting in person. Although many experts say that voting in person is fine providing you follow the same guideline as you do elsewhere with social distancing and masks, the mail in option was rather popular this time round. 

Whether you vote by mail or in the 'booth" be sure to cast your vote from the top down. Don't forget about all those local election items, they are just as important as the top fed ticket. 

Meanwhile people looking for a spot to spend the 'golden years' Washington still offers a great deal to seniors and young retirees alike. We have excellent health care, low taxes for seniors, wonderful outdoors, and very mild weather for such a northerly locale.

Don't forget Washington is a no income tax state. I wrote about that last year in the following article:

Let's look at why an income tax is more of a killer than a sales tax especially for retirees. Retirees often do not have many tax deductions or exemptions. So a retired couple earning a taxable household income of 35,000 will pay about $3150 in Oregon State income tax. Contrast that with the a typical annual sales tax paid in Washington at $1200.

Sales tax is something you only pay when you buy a taxable item. In Washington food for example is not subject to sales tax. An income tax is levied before you receive your net check. You are going to pay it whether you buy things or not. Sales tax is almost always a lower expense than income tax with the notable exception of being poor. Those in Oregon who have a taxable income of $0 will not pay any income tax, obviously. But in Washington a person with a taxable income of $0 will still need to buy things and some of those things will be subject to sales tax.

Please take note I am using taxable income, because retirees are not subject to income taxes on a sizable portion of their Social Security, ROTH IRA's are tax free, and standard exemptions and deductions reduce taxable income. So someone earning $20,000 could in fact have a taxable income of $0.

So the rule of thumb is, if you are poor live, in Oregon, if you are middle or upper income, move to Washington. Well it isn't always quite that simple, but that simple solution is not to far from reality in actuality. 

Tuesday, September 22, 2020

Retiring in the COVID-19 Era

 COVID-19 is a serious concern for older people and generally those looking at retirement are in that "older" category. How does COVID effect soon to be retired people? Can you still move? Can you still buy a house?

Well the move part depends on your local state, but in Washington real estate is alive and well. There are so protocols we utilize when showing properties, but sales are quite brisk. in fact the real estate market is holding the economy together right now. 

Our market here in SW Washington is seeing pressure on housing from multiple fronts. Low interest rates are driving millennials to the market. Geo-Political and taxation issues are drive Oregonians, particularly from Portland to the area. And the mass exodus in California is also driving buyers our way.

Washington enjoys a robust and high quality healthcare industry as well as a variety of quality living communities for the retired set. COVID-19 hasn't made this area any less desirable for retirees, in fact it may be even more so with quality heath care, no income tax, and somewhat flexible COVID-19 government restrictions.

Washington continues to be a great place to retire and the strong real estate market means retirees can enjoy a rising equity position as more and more people flock to the state.

Tuesday, August 25, 2020

This month I am recycling an article from my Real Estate website that has some relevance to retirees considering Vancouver, USA.

Originally posted on Realtor Rod, 8/14/2020, by Rod Sager

High-rise condos

Vancouver, USA is a place that has one of the most diverse residential real estate markets in the entire region. The city proper lies on the shores of the mighty Columbia River where nearly 200,000 people reside within the incorporated boundary. But Vancouver also has another 140,000 or so people living in urban and suburban neighborhoods just outside the official "city." 

This can make for some interesting transitions between various neighborhoods that have developed over the decades at different paces and under different county guidelines for development. When venturing outside the incorporated boundaries of the city, neighborhoods will take on a variety of different characteristics ranging from near rural to urban densities. Outside of the incorporated city one may find neighborhoods with streets that transition from fully developed suburbia to rural open culvert and back again. This is very rare inside the incorporated city but somewhat common in unincorporated neighborhoods. This is not a problem per se but for those that like a conforming neighborhood the incorporated city is the best bet.

It is mostly in the unincorporated neighborhoods that one can find a suburban home on a large 1/2 acre or even 1 acre lot with a bit of a country feel yet still "in town" with close proximity to suburban amenities like schools and shopping. But these are also neighborhoods where one might notice some quasi rural effects such as livestock, roosters, and other traditional rural and farming type ambiance for better or worse.

Most cities have a variety of transitional areas but Vancouver has 140,000 people living in these unincorporated neighborhoods. Vancouver has more people living in the neighborhoods outside the city than live in any of Portland's suburban cities including Gresham, Beaverton, and Hillsboro. 

At some point over the next decade or so, the city will annex most of these areas and when that happens some conformity changes will occur which in general helps the overall aesthetic, but may cripple some of the charm. 

Rural 5 acres, in close to "town"

People moving in from out of the area are often taken by surprise at the "size" of Vancouver and that is likely because they expected a city the size of the Vancouver described on the Wikipedia page and found the Vancouver of reality which is nearly twice as big. Vancouver has a robust downtown that has become very urban over the last 25 years yet remains notably more navigable than Portland's busier urban core. One can find high-rise condos and waterfront apartments in modern walk-able and sustainable neighborhoods. Vancouver has a large area of vintage classic homes in Norman Rockwell type neighborhoods such as Arnada, Shumway, Hough and Carter Park. The city has a wide swath of neighborhoods with homes dating to every decade of the 20th century. Vancouver is like a time machine of sorts offering a glimpse of neighborhood life across the decades. 

For those that want a house on five acres with horses and such, Vancouver even has a fair bit of that to the east in the Proebstel area. Like the title says, it's an eclectic mix with something for everyone :)

Tuesday, July 28, 2020

Low Rates Driving Buyers to Market

Low interest rates are driving new buyers to the market all over the country. Although many retirees plan on a cash purchase, having entry level buyers competing for similar one level smaller homes can prove troublesome for the budget minded retiree. 

Although Washington is attractive to seniors and retirees with no income tax it is also popular among young people coming into the state for high paying jobs across a wide number of fields. The Tri-Cities and Vancouver remain popular for both retired and working people.

Retirees looking for that one level dream home may find themselves in competition with up and coming youngsters looking the jump into the is hot market with sub 3% mortgages available for solid borrowers. Retirees over the age of 55 can sometimes find communities design for older residents and may find less competition from working persons. But those communities are often sought after as well by the millions of aging boomers looking to downsize and slow the pace.

In any case retirees thinking about paying cash for a house may want to revisit the notion of a loan. Borrowing a few hundred grand at less than 3% is not a bad deal at all.   

Tuesday, June 23, 2020

Is SW Washington State the BEST non Sun Belt Location in America?

I say non Sun Belt because let's face it, seniors tend to retire in warmer locales. Washington State and warm weather are rarely in alignment. That said Washington State enjoys the most mild winter weather of any state above the 45th parallel. How does the Evergreen State compare against the top US States to retire in? According to Investopedia the most POPULAR states to retire in and According to Wallet hub the BEST to retire in.

Rank Best Most Popular Rank Best List
1 Florida New Mexico 49
2 Colorado Florida 1
3 New Hampshire Arizona 22
4 Utah South Carolina 18
5 Wyoming Idaho 9
6 Delaware Maine 28
7 Virginia Vermont 36
8 Wisconsin Nevada 35
9 Idaho Wyoming 5
10 Iowa Montana 12

Notice that Washington State appears on NEITHER list. On the wallet hub list of "Best" places to retire Washington is crushed by it's Number 36 "affordable" ranking and that is driven largely by the atrociously expensive Seattle Metro Area housing costs.

The most popular list has some strange variance from the best list. Vermont is very popular for retirees yet ranks poorly on the best list which measure metrics important to retirees, like health care, weather, housing costs, taxes, etc.

This dynamic shows that some retirees ignore the ratings and go for other reasons, such as proximity to family, weather over all else, air travel corridors to visit family they may be leaving to retire, and so on. Why do so many North Easterners retire to Florida? Many reasons, it is a north south no-time zone flight between the Northeast and Florida. Florida is highly rated for retirees. It is a no brainer, really.

California is a state that is shedding retirees fast. Arizona and Nevada are no doubt popular choices for the exodus of California. Washington State enjoys a similar advantage to Florida for California retirees because of the short north-south flight corridor allowing for easy visits to family and friends left behind. Although California transplants are the #2 source of new residents to Washington State, Oregon remains #1 by a huge margin. Washington is an easy choice to make versus Oregon for retirees. In fact when housing costs are taken out of the equation, Washington State routinely ranks in the top 10 states in America to retire. The beautiful thing about Southwest Washington is that housing costs locally are less than HALF that of Seattle.

Southwest Washington State is regionally superior to Washington State offering all of the Evergreen State benefits without the glaring disadvantage on housing costs. Overall when separating this local area out from the rest of the state, SW Washington would easily land in the top ten best list.

Let's do a scale of 1-10 in Clark County, Washington for retirees compared to other West Coast locales, click on the chart to enlarge.

This area continues to be a large draw from West Coast retirees in Oregon and California, be it chasing the kids to better opportunities in retirement, Washington State outside of Seattle is still one the best places in America to retire.

Tuesday, May 26, 2020

COVID-19 Slowing Down but not Halting Construction

Several fantastic senior living projects are in a variety of phases right now in Vancouver. The progress on some of the projects actively under construction was slowed significantly for a couple of months when the Corona Virus pandemic first hit. Now crews are back on the job and most are running at at least 60% capacity.

A few projects that are still in the planning phases may also be a bit delayed but that process is going to start picking up as well. Any people that are further along the road of retirement and may be looking for living arrangements that allow you to age in place, may need to sit tight an extra couple of months should a newer facility be to your liking.

There is a great deal of construction and planning in the senior living space her in Clark County, Washington. Washington remains a great place to retire and may be the best four-season retirement state in the USA.

I mentioned in a prior post that The Springs Living is planning on building their first high-rise property on Vancouver's Waterfront. The Block 18 proposal is working its way through the planning phases. So long as the Springs has their funding in place that project should be shovel ready in less than six months. The City of Vancouver has master-planned that entire 21 block waterfront as an urban community. The Springs proposal at 12 stories meets the minimum density requirement and should have no issue with FAA height regulations for the nearby PDX and Pearson airports. I am actually very excited about the Springs project it looks fantastic and will give local retirees a modern urban living experience on the majestic Columbia River.

Affinity at Vancouver is wrapping up their large 170 unit project in Orchards near the SR-500 & I-205 interchange. This more suburban project is close to shopping and services as well as major highways.

Overall things are looking up for retirees in Southwest Washington state even as the COVID-19 restrictions continue, projects continue to progress as well.