Your retirement budget could go further than you think in Prescott – or not as far. Before moving to Prescott, watch this video to learn about the costs that catch many people by surprise, so you can feel confident before you pack a single box.
Video Transcript
Prescott is a great retirement town, but some people move here and realize too late they can’t afford it. [music] Hi, I’m Diane, the Prescott pickle lady, and I’m Randal, her trusty sidekick. We make videos to help people who are thinking about relocating to Prescat understand what it’s really like to live here. If you are thinking about moving to Prescat and trying to figure out whether it fits your budget, this video is for you. We’re going to walk through the real cost of living in Prescat, Arizona, so you can decide if it makes financial sense for you. We’re going to break down the biggest cost drivers in Prescuit, including housing taxes and the everyday expenses that add up over time. Then, we’ll show you a simple way to estimate your own monthly cost so you can compare Prescat to where you live now. Make sure to stick around to the end because we have a special goodie for you. A clever little tool that will show you exactly what it would cost you to live here. [music] Housing is the big one. It’s the biggest one. By far the biggest one. Prices are higher than many expect for Arizona. People are still thinking this is a small little country town, right? Uh that’s not true anymore. It has changed. It’s it’s definitely changed. outofstate demand has influenced the pricing big time. Yeah, we’ve got a lot of exit states that send people here and they keep our prices kind of high. So, we went through uh two years of COVID 30% appreciation and the prices have not dropped. They’ve just been they’ve been flat, but uh they have not dropped like they spiked up during CO. Lots of biddy moores drove everything up and now we’re pretty much level. Uh so some people are still trying to price COVID wise. Um and then they realize I have to get down, you know, back to the normal. So they really haven’t adjusted that much. Yeah. So if you’re looking to manage your housing costs, you know, new construction costs more than older construction. Yep. A resale is typically more affordable than a new build. And fixer uppers are always a bargain. Uh you can also look at some alternatives to Prescuit itself. There’s Prescat Valley right next door, Chino Valley, Dewey Humble. We can hook you up with homes in these areas as well if uh if you kind of want to manage that a little bit. That’s right. Yeah. So, housing is the biggest piece, but it’s not the whole story. Next, we’ll look at what taxes are like here. [music] All right. So, property taxes are pretty low here. Amazingly low. Yeah. So, if you’re coming from California, you’re going to be shocked and amazed. Most of my Californians say, “Oh, that must be a quarterly tax or is that a uh you know semianual?” No, it’s the annual tax. It’s not. And property values are going up. That doesn’t mean your property taxes will too. Uh the great example I always use, I mentioned before that during COVID we had 30% appreciation. Homes went up 30%. You know what the taxes did? The property taxes actually went down. That’s correct. And the reason why is because COVID was out, the city couldn’t do a lot of the regular services and so they knew that they were going to save money that way. So they actually reduced taxes. That’s the kind of city it is. They they are very fiscally responsible. So if you buy a house that somebody bought for 600,000 and they sell it to you for a million, your property taxes are not going to jump up to that million dollar. And believe me, they really don’t. We’ve been here 10 years. I think our taxes now are maybe 2500 a year. Yeah. And our house is about 3,000 square ft. So, yeah. So, uh we don’t really have a lot of big jumping in. Now, there is uh state income tax. People go crazy. Oh, there I don’t want I don’t want to live any place where there’s state income tax. The thing is the combined tax burden is often lower than states that have no income tax. I’m thinking specifically of Texas where we live. I’m looking at you, Texas. We lived in Texas. We the the property taxes we paid and we did not have a very expensive home easily outdistance what we’re paying now in property tax and income tax combined. Right. And I do believe, don’t quote me on this, but I think they do not tax your uh social security. So keep that in mind. This state does not tax social security. So if you’re retired and gathering that, you don’t have to pay on that. Um, yeah, Texas, everyone’s like, “Oh, no state income tax.” That’s great. But you buy a house for 500,000, your income tax, your uh property taxes, I should say, 15 grand. Yeah. 11 to 15 grand. Easy. So, keep that in mind. They trick you. All right. So, taxes might surprise you in a good way, but there are a few costs people tend to overlook that can really add up. Yep. [music and bell] All right. So, let’s talk utilities. Utilities are driven by the four season climate that we have here. We have four seasons. You’re going to pay for gas in the winter and you’re going to pay for electricity in the summer. Right. Talk about that. Tell me about the utilities here. Utilities here are very reasonable and very low. Uh I know in some areas in California, the electric, the water and gas are skyhigh. We are still within reason. You know, we’re very reasonable rates. I run my house super super super cold in the summer and the highest bill with two stories I’ve ever had is like 375. Yeah. And most people don’t run it the way we do. No. No. So you’ll be fine. We are on the side of cool. So during the winter we don’t spend as much on gas as maybe some of our friends do. They like to keep the house uh warmer. We like a cool house. So we pay the price in the summer. Yeah. But most folks, even in the winter, just run their uh fireplace, which is what we do. Yeah. And we stay nice and warm. Uh we also uh whole house fans are really big here. Even though we have central air in in all homes, I installed a whole house fan. So like right now, I’m not even running my air. I just run my whole house fan in the evening and it keeps it nice and chilly. Yeah. In the summer, it’s cool at night. So if you run the whole house fan, it clears your attic of all the hot air. Absolutely. It’s a good a good costsaver. And so because electricity is not that expensive here, um it’s not really necessary to have solar unless you really want to be cognizant of the climate and you want to be more green. Yeah. Um but yeah, solar is really about being green here. It’s it doesn’t really usually make financial sense. If if you’re looking at a community that has a lot of solar, either they’re really green or utilities are really high. You won’t see a lot. So in Phoenix and Scottdale, [clears throat] it makes a lot of sense to have solar, but here because our utilities aren’t that expensive, it’s a cost factor. So it’s up to you whether you want to uh put in that extra amount and add solar. Talk about insurance. Tell me about insurance. Um insurance varies. Uh it’s still pretty reasonable. Uh some areas uh it’s a little bit uh harder to get because they’re more in a wooded area. I believe the 86305 zip code. Um, sometimes you have to shop a little bit more because they’re more concerned about the fire. Sorry, California that that happened, but it’s now affecting everybody across the United [clears throat] States. Um, my insurance just went up because I had two leaks. Other than that, it would have been [laughter] uh if those were basically my fault. My home insurance would have been about 1,800 a year. Yeah. So, not bad. So, uh, tell us about HOAs. HOAs depending on your neighborhood uh cost you know some have no HOAs some like Prescuit Lakes uh every neighborhood has a different HOA where I live in Prescat Lakes my HOA is $183 a quarter so every three months I get a bill for $183 so on average that’s less than $100 a month right so you’re not going to have people are coming from areas that have extremely high HOAs and so you say HOA like I don’t want an HOA I don’t want it I don’t want And then when they find out how cheap it is, it’s really not that big a deal. Absolutely. I mean, most of them are spending 500 to 800 a month on HOAs. That is unheard of here. It will not happen. It’s pretty reasonable. So, not bad at all. And uh you will need a car. Yes, you will need a car. We really don’t have public transportation. Speak of no buses. We do have So, you need a car. Ongoing maintenance. We have cabs. we have, you know, things like that, Uber and Lyft, but uh, you know, if you don’t want to rely on that, then you need to, you know, know that you would, you need a car to get around. Absolutely. Hey, let us know what your biggest financial concern is about moving here to Prescuit. We’d really like to find out. Uh, if you would leave a comment and we’ll check that out. All right. And now that we’ve covered costs, let’s talk about a few finance tricks people use to help make the numbers work. [music] Here’s some quick tips. Oh, he’s jumping ahead. Yeah, we’ll give you the links to more detailed videos on all of these, but we thought we’d just kind of mention quickly. Please note, we have no vested interest in any of this stuff. We don’t get a kickback for referring. We don’t, you know, we just we are here to facilitate you getting into the home of your dreams in the easiest way possible. These these are things that some of our clients have done and they’ve had good results with them. So, we thought we’d share them. We are not professional. We’re not financial financial. Yeah. So talk to your expert about all of these things we offer for, you know, this is just what we’ve heard. We’ve seen people do this and they’ve had good experiences. So the first one is bridge loans. A bridge loan. So first thing you think of, oh, they cost a lot of money, right? They can they can they do they can cost a lot of money. They can also save you a lot of money. And that’s what people don’t understand. When you do a bridge loan, your your buy is like a cash deal. And when you are negotiating with cash, you can pay less than list price. That’s right. H thing is also too on your sell side. So you’re selling your home, if you have a buyer contingency, you’re going to be anxious to sell that home. You’re going to take the first deal that comes along usually because you’re panicked, you’re stressed, you’re like, I got to sell this house to get into the next. Usually between negotiating on your sell side and negotiating on your buy side, you kind of break even or close to it. That’s been our experience. Plus, you’ve got additional moving costs or storage costs that you might be looking at because you’re trying to get the two ends of of your deals to meet together. Check out bridge loans. Usually, they end up kind of breaking even and they can really reduce your stress. And the one that we refer to uh doesn’t even require you will not have a second mortgage so to speak. Um you don’t even have to pay monthly interest. That interest will acrue. Um but you put up your your the fee that they charge you can be 15 20,000 upfront and that covers some of that some of their cost. Yeah. And they give you a huge amount of money and then you go in with a cash deal. So uh some of that is good. Uh you have one year to sell your home, too. So, if you sell it quickly, okay, you know, you don’t pay that much interest, you’re done. Yeah. So, all right. Next up, reverse mortgage. Oh, you got a reverse mortgage. You can lose your house. No, you won’t. People reverse mortgages are are done through the government now. They’re governmentbacked. So, if you run out of equity, they do not run you out of your house. In fact, if you have a spouse and you pass away, your spouse gets to stay in that house until uh he or she decides to sell it or they pass away. You will not lose your house. Most people should use a reverse mortgage when they reach a certain age because what they end up doing is scrimping and saving, struggling to pay mortgage payments and all that. All so that when they pass, their kids can sell the house at that point. That’s right. And it and and it helps them keep maintain the home. Yeah. Um because if they’re spending all this money on mortgages, the rest they can at least keep the house current, up to date, fix the AC, fix the roof, all the things that are very difficult when you’re retired. Allows you to do a little higher on the hog. So, if you haven’t looked seriously at a reverse mortgage because you’re afraid you’re going to lose your house, talk to an expert. Talk to us. We’ll have we’ll put you in contact with an expert. Uh it’s it’s a really good product and and chances are it it might help you. It’s not your parents uh reverse mortgage from the 90s. That’s right. Very different. Final thing is retirement funds as collateral. Yes. You look at your retirement funds. Oh, there are penalties to take it out. Oh, they’re going to be capital gains. A few of our friends have managed to use their retirement funds as collateral and then took out a loan. So talk to your financial advisor or your money manager. Chances are they can work out something for you and uh rather than have to liquidate those funds, you can just use it as collateral. That’s right. And get a loan. So there you go. Three three quick little lots of info, my friends. So if you’re finding this information helpful, we’d really appreciate it if you would take a moment to like this video. It really helps us a lot. And if you want to make sure you get all of our new videos as soon as they come out, subscribe. Chances are you know someone who should watch this video. If so, take a moment now and share it with them before you forget. Now that you’ve seen the big picture, the next step is figuring out what it looks like specifically for you. [music] So, this is the section you’ve been waiting for, the one we told you about at the beginning, where we will give you a special treat that will tie all of this together for you. Yeah. So, just to cut to the chase, this is a simple spreadsheet tool to estimate and compare your current spending to where you’d be once you move to Prescuit. So, the link is in the description. We’ll do a QR code up here somewhere. You can do the QR code or you go to prescatscoop.com/costs and it will take you to this tool. It is easy and fun to use and allows you to test different scenarios to get your hands around all the numbers. Download it now. Give it a spin. If you need help, we’d be glad to help walk you through it and talk to you about it. If Prescuit is starting to sound like it may be a real option for you, you’re probably thinking, I want to see some homes there. That is exactly why we’ve created our home alert survey. It helps you define what you’re looking for in a home and connects you with the real listings on the market right now that match. When there are homes that fit your parameters, they’ll come to you straight to your email automatically. And of course, you can unsubscribe at any time using the easy link provided in every email. To get started, go to picklealerts.com or use the QR code provided on the screen or look for the link in the description. Once you figure out what you can afford, the next step is figuring out where in town you might want to live. Amazingly enough, shockingly, we have a video for that. And by now, you’re probably noticing that we have a video for pretty much everything. Well, this video walks you through the top five neighborhoods in the city of Prescuit. And if you see anything you’re really interested in, give us a call. We’ll preview it for you and do a video. In the meantime, we hope you found our video informative and fun, and we hope to see you next time. Bye, friends. Bye.
