Sam Del Rowe at Financial Advisor IQ wrote about the rising cost of home repairs for clients planning to downsize in retirement, and how advisers can help them plan for it. The median age of an owner-occupied home in the U.S. is now 42 years, a large share were built before 1970, and repair costs rose 16.7% between 2022 and 2024, with structural repairs up 21.3%.
Here is what I told the reporter. Most clients think they know what their home is worth. They look at Zillow, pick a number, and build the retirement plan around it. The actual net is almost always smaller, sometimes by a lot. Clients who have not sold a home in decades often have no idea what repairs might be required before a sale closes, or what lenders will mandate for health and safety reasons before they will finance the buyer.
The example I used: you get the inspection report back and there is $40,000 in structural damage you did not know about. The retirement plan assumed you would net $350,000 from the sale. Now you are recalculating.
The planning work happens before the listing, not after the inspection. In our planning meetings we walk through when the home was built, what major systems might need attention, and what a realistic net looks like after repairs, commissions and taxes. Then we build in placeholders for repair costs, adjust the expected proceeds, and make sure the plan still holds if the number comes in lower. The goal is not to dampen the excitement of downsizing. It is to make sure the number the client is counting on is the number they actually walk away with.
Read the full article at Financial Advisor IQ →
