Retirees Who Rented in Florida for a Year Before Buying Say It Was the Best Money They Ever Spent
Buying a Florida retirement home before living there full-time is a gamble that has cost some couples more than a year of rent in a single calendar year, and a November ballot vote makes the timing of a purchase in…
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Florida retirement plans often start on vacation, as a couple spends two weeks there in February, falls for a screened lanai, and closes on the house before pricing a wind mitigation report, living through August humidity, or reading a condo reserve study. Retirees who rented for a full year first usually describe that year as a low-cost way to test the decision. Ultimately, renting isn’t just the best way to test a move; it also gives you a better sense of what life can really be like, including a property tax detail that makes the timing of a purchase in 2026 matter more than usual.
What a Year of Renting Costs Next to a Bad Purchase
An average two-bedroom apartment in Orlando rents for about $1,972 a month, or about $23,700 for a full year. Compare that with buying too early. In June, the median condo or townhome in Sarasota County sold for $343,750, down 7.5% from a year earlier. That decline erased about $25,800 in value within 12 months, before commissions and closing costs.
The wider market gives renters time to wait. Existing home sales ran at a 3.98 million annualized rate in August, the slowest reading of the past year and in the 3.5 million to 4.5 million range usually described as soft. Insurance is the other big unknown, as average premiums with wind coverage run from $2,105 in Sumter County to $7,863 in Monroe County, a gap of $5,758 every year depending on location alone.
Budget and Portfolio Target for a Couple at 65
Start with average household spending of $78,535. Florida’s cost-of-living index is 103.414, so the adjusted working budget is about $81,200. The table assumes the couple pays cash for Sarasota County’s median single-family home at $492,450.
| Line Item | Annual Cost |
|---|---|
| Homeowners insurance (state average) | $3,815 |
| State and local taxes, two people | $10,220 |
| Maintenance at 1% of home value | $4,925 |
| Medicare Part B, two people | $4,870 |
| Food, utilities, vehicles, supplemental coverage, federal tax, reserves | $57,386 |
| Total | $81,216 |
The tax line uses Florida’s income-adjusted state and local burden of $5,110 per person. Because it has no individual income tax, Florida ranks 1st on that measure. Part B costs $202.90 per person per month.
If both spouses collect the average retired worker benefit of about $2,086 a month, Social Security covers $50,064 a year. That leaves $31,152 for the portfolio to fund. At a 4% withdrawal rate, the portfolio needs about $778,800. At a more conservative 3.5%, it needs about $890,000 (we made the case for retiring the 4% rule in favor of an income-first approach in a free report). When the higher earner delays taking past full retirement age, the benefit rises 8% for each year of delay up to 70. The 2027 COLA is tracking toward 3.3%, against CPI inflation of 3.4%.
January 1 Deadline and a November Vote
Florida’s homestead exemption requires owning the home and living in it as a permanent residence on January 1. A buyer who closes in February pays the full non-homestead rate for the rest of that year. The sale resets the assessed value to market. Once homestead is in place, Save Our Homes limits annual assessment increases to 3% or CPI, whichever is lower. With inflation at 3.4%, the 3% cap applies.
This year, the calendar matters more, as amendment 3 goes to voters on November 3, 2026, and needs 60% approval. It would increase the homestead exemption on non-school taxes to $150,000 in 2027 and $250,000 in 2028, up from the typical $50,000. Each mill of non-school millage applied to the additional $200,000 of exempt value works out to $200 in annual savings. Renting through the vote shows which tax rules apply before you choose a county or price.
What It Takes to Make the Rental Year Pay Off
For a couple collecting average Social Security, the full plan needs about $1.29 million to $1.41 million in liquid assets. That covers the house bought with cash, the year of rent, and a portfolio sized for a withdrawal rate of 3.5% to 4%. A diversified mix of index funds returning about inflation plus 3.5% can carry it. A short treasury ladder can cover the rent and the first few years of withdrawals, keeping a down market from forcing stock sales while the couple is house hunting.
Signing a lease that runs past a January 1 closing and past the November vote gives the couple a known tax situation, known insurance quotes, and a soft market to buy into, all for about one year’s rent.
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David Beren has been a Flywheel Publishing contributor since 2022. Writing for 24/7 Wall St. since 2023, David loves to write about topics of all shapes and sizes. As a technology expert, David focuses heavily on consumer electronics brands, automobiles, and general technology. He has previously written for LifeWire, formerly About.com. As a part-time freelance writer, David’s “day job” has been working on and leading social media for multiple Fortune 100 brands. David loves the flexibility of this field and its ability to reach customers exactly where they like to spend their time. Additionally, David previously published his own blog, TmoNews.com, which reached 3 million readers in its first year. In addition to freelance and social media work, David loves to spend time with his family and children and relive the glory days of video game consoles by playing any retro game console he can get his hands on.
