Foss says if you can handle the expense and hassle of a rental property, this could be a good way to use the property before it becomes your primary retirement residence.
Charles Duck, president of Charles Duck Real Estate in Phoenix, says the pre-retirement buyers he works with are looking for bargain-priced luxury homes because they offer more certainty of future appreciation.
"Some people are deciding to buy now and leave the property empty for a while or to use a place as an occasional vacation home," Duck says. "Others decide to rent the property until they are ready to use it. The important thing for all these buyers is to find a latchkey property so that they can travel or live elsewhere and not worry about it."
When choosing a home a few years before retirement, Duck says the first consideration should be the location.
"Many retirees want an urban-suburban location where they can walk to amenities and restaurants," Duck says. "The important thing is to look at this property like any other investment and evaluate the potential resale value based on the location, community amenities and floor plan."
Duck says this cohort of buyers should consider looking for low-maintenance houses with all the living spaces on one floor, so the future retirees can avoid climbing stairs.
Foss says if you are 10 years or more away from retirement, you may want to opt to rent a vacation home for a month at a time in order to avoid getting stuck with a permanent decision about your retirement destination.
"People change a lot between age 50 and 90, so I like the idea of keeping your options open and allowing for flexibility," says Foss. "Buying your retirement home early can be a great option, but I recommend that people do this with the mindset that it is a rental property with the option of using it as a vacation home later rather than getting locked into a retirement plan."
Cunningham says to have a backup plan for a second home, including an estimate of rental value in case the home cannot be sold for a profit if you change your mind.
"Buying a second home is not for people who are just getting by," says Cunningham. "This should only be a choice for people with the income and assets to handle it."