Saturday, March 13, 2010

Retire to Beautiful Gary, Indiana!

Yesterday, I watched a video of glum pessimists Mish Shedlock and Marc Faber talk about how we were all doomed here in the US. Pensions are going to be slashed, deflation in wages is going to occur followed by wild inflation from the Fed printing money and so forth. In thinking about that, I wondered what I would do if I was on the verge of retirement and the future seemed dark.

I might move to Gary, Indiana*. In the heart of the rust belt, Gary's real estate prices are depressed. Assuming you owned a $250,000 home somewhere else and still owed $100,000 on it, you could sell the house, take your proceeds and buy this cute cottage in Gary for about $50K and have $100K left over to bank.

Brick house in good condition with partially finished basement. 4 bedrooms, 1 1/2 baths.

While this scenario isn't real for me, it is for many others. You'd think that the Rust Belt would offer some excellent options for retirees. Yes, the weather is brutal in the winter, but the cost of living is low and you'd be able to own your own home free and clear in most cases. After that, you'd be able to live on your reduced pensions and battered 401Ks.

I wonder if anyone in the Midwest has considered marketing the place as a retirement option.

* - In all seriousness, I'd be much more likely to move to somewhere in the Deep South, but the idea is the same.

6 comments:

Kevin said...

Or Flint or Detroit. Real estate prices are dirt cheap right now. Shoot, they're just tearing down entire neighborhoods because the houses sit empty.

Jeff Burton said...

You must be kidding. Be prepared to spend a good chunk of that 100K on arms and ammunition. Gary, IN is one of the most dangerous cities in America. You probably know this already, but risk aversion increases with age.

K T Cat said...

Yeah, Gary was just an example drawn out of a hat. I think you can find plenty of others where the crime rates aren't so high that have lots of great real estate bargains.

Anonymous said...

Others beat me with comments on the cost of maintaining your own armory.

A few years ago there were stories about people retiring early, cashing in on their houses, and moving to the Dakotas for a quiet life. I suspect the real estate there hasn't plunged quite as much, but the principle's the same.

tim eisele said...

That's been going on up here for a long time, ever since the last copper mines shut down in the 60s, leaving a lot of *very* reasonably-priced houses. A large fraction of the population is retirees who wanted to go someplace cheap and quiet (and were willing to put up with the winters). And a lot of *them* are old alumni of Michigan Tech, who have fond memories of their college days and come back here when it is time to retire.

K T Cat said...

You mean I'm not the first person to come up with this idea?

Hmmm.

Well, keep it quiet. I still might be able to get the credit.

;-)