Vermont, America’s Next
Retirement Hot Spot
My wife Connie and I spent five weeks in late summer in a Vermont cabin beside the northern tip of 100-mile-long Lake Champlain. We were visiting with our daughter and son in law just before and after the birth of their first child.
Vermont could very well become the next hot retirement destination. In fact, it may already be there. I played golf in early September just outside the friendly and active university town of Burlington. Seven foursomes of couples played in front of me and, after my round, I learned from the club’s GM that all 28 of them were winter residents of Florida. She told me more than 50 of the club’s members were Florida residents who summer in the Burlington area.
Not everyone can afford two homes and two sets of property taxes. But for those who can, Vermont (especially the northern tier) is a terrific place to live. For those of you who might not be able to stand the heat in a full-time Southeast home, the Green Mountain State should be high on your list. Yes, it is a relatively high-cost state, but if you have enough income to justify sheltering it in a no-tax state like Florida or New Hampshire, you probably earn enough to live in a higher-tax state largely free of traffic, pollution and, frankly, the toxic politics of some other states. Vermont currently has a Republican governor and a Democratic legislature, and they operate with the kind of harmony that has produced the best record in the nation on fighting the pandemic — which is why many of those fleeing city and suburbs for shelter from Covid are landing in Vermont. That should only continue as companies save money on leases and utility costs by sending their employees home to work permanently.
Political harmony in Vermont appears to extend to cultural differences as well. Gun advocates and granola eaters live together without apparent controversy, with few ugly newspaper headlines about one side judging the other. The state motto could be “Live and Let Live.” (It is actually the equally fitting “Freedom and Unity.”) In a divided nation, such comity should be worth a few extra percentage points in income tax.
Prices for homes have been rising steadily in Vermont during the pandemic. One real life personal example: Three years ago, our daughter and her husband purchased a nice home in a modest neighborhood in St. Albans, 15 minutes from the Canadian border. A couple of similar homes down the street sold earlier this year for 60% more than our kids paid just three years ago.
I always scratch my head when clients with relatively modest retirement incomes tell me they want to live in Florida or Tennessee so that they won’t have to pay income tax. Of course, those states need to generate income in other ways — or hold back spending on things you may consider necessities (e.g. aid to education; Vermont, according to the publication Education Week, spends the most per pupil of any state when adjusted for cost of living.)
Instead of just simply looking at the no-tax states for your retirement, check out sites that list total cost of living by state. You will find that a no-income-tax state like Florida is not the least expensive.) The World Population Review cost of living index for 2021 indicates that Vermont’s rating is 114.5, or 14.5 percentage points above the U.S. average. Florida, on the other hand, shows a cost of living index of 97.9, or 16.6 percentage points lower than Vermont. New Hampshire’s COL index is 110.3 whereas North Carolina’s is 91.8. Put another way, if you spend $40,000 per year on fundamental expenses, it will cost you $664 per year more to live in Vermont than in Florida, and $740 more to live in New Hampshire than in North Carolina. If your retirement income is, say, $75,000 annually, it will cost you less than 1% of your income to live in Vermont rather than Florida, if you so choose.
Taxes, of course, are a cost of living in every state. According to a Wallethub study earlier this year, there is a four-percentage-point difference between the total tax burdens of Vermont (10.75%) and Florida (6.97%). Florida is considerably less burdensome on state income tax and property tax, but higher on sales taxes. (Florida 4.23% and Vermont 3.30%). We all have to spend on necessities and some of us will spend on luxuries as well. For a couple making, say, $50,000 annually in retirement income and living in Florida, buying “stuff” will cause them to pay more in sales taxes than, say, a couple making the same amount and spending a similar amount in Vermont.
Whereas property taxes in Florida are lower than in Vermont, comparable houses in the Sunshine State appear to be more expensive. In my experience, nice homes in golf communities or adjacent to quality golf courses are at least 25% higher in Florida than in Vermont on a comparable square foot basis. When all is said and done, if a Florida home is a couple hundred thousand dollars more expensive than a Vermont home, you could pocket the difference, put it in an interest-bearing account and use the interest to pay for the marginally higher taxes in Vermont.
My overriding point is that, in retirement, cost of living and taxes should be less of a consideration than many of us believe. As I write this, I am reminded of a couple of lines from a Mamas and Papas song in the 1960s: “Go where you wanna go/Do what you wanna do…” You can afford it.
Nothing Borderline about
Vermont Golf Courses Near Canada
I had some quality time in late August and well into September to play 10 golf courses in northern Vermont and across Lake Champlain in way-upstate New York. I have posted comprehensive reviews of some of them at my website, OffTheBeatenCartPath.com, with more to come. Here, in a nutshell, is what I thought of each of them, with ratings on a 1 to 5 scale, 5 being “Wonderful,” 4 “Very Good” 3 “Okay” and 2 “Fair.” None I played merited a “poor” score, not even close.
Jay Peak, North Troy, VT
Rating 4.5
I wouldn’t recommend the Jay Peak golf course to a 20-handicap player, but for those with the ability to hit the ball straight, to chip and putt well and secure enough to move up two tee boxes from their customary launching pad, the layout provides gorgeous views and excellent conditions. For the quality of the layout, the $65 I paid, cart included, was an extreme bargain. Better yet, if you decide to make Vermont your permanent or summer home, a membership at the semi-private resort course will pay for itself in about 30 rounds.
Green Mountain Golf Club, Killington, VT
Rating 4
I love to start off a round with a par 5. Using driver, fairway wood and (hopefully) short iron to the first green is a great way to kickstart 18 holes. Green Mountain’s starting hole is a par 5 of modest length with a generously wide fairway. From the tips (black tees) it is “only” 513 yards, just 443 yards from the tee boxes I played (total length 5,787 yards). When you play Green Mountains, pay attention to the beautiful scenery – and the scorecard’s advice about which tees to play.
Williston Country Club, Williston, VT
Rating 4
There is a lot of work being done on the Williston layout, including a brand-new 18th green and tee-box updates. The course was in excellent condition and the holes varied and challenging. Williston is a 90-year-old layout owned by one family since the beginning, and the latest whippersnappers running it – two brothers – clearly want to keep it one of the most popular layouts in the Burlington area. They are doing a good job of it.
Bluff Point, Plattsburgh, NY
Rating 3.5
Bluff Point has history, and that was the source of a little of my disappointment. If I hadn’t read about the place before I arrived there, it would almost certainly warrant a slightly higher rating. But when you advertise a circa 1916 A. W. Tillinghast design, he of Bethpage Black and Winged Foot fame, you set up major expectations for those of us who have been lucky enough to play one of his layouts and know his reputation. Some of Tillinghast’s holes at Bluff Point had been replaced (to build a parking lot, no less) and, over the years, his signature bunkers had pulled well away from his equally distinctive greens, and everything felt flatter than the architect must have intended. But playing a course that had been beloved of U.S. Presidents – McKinley, both Roosevelts – neutralized the disappointment, even if it wasn’t exactly the course they had played.
Kwiniaska Golf Club, Shelburne, VT
Rating 3.5
“Kwini,” as the locals call it, is a bit of a hodgepodge layout, and with good reason. Some holes that once played across the road from the rest were sold to a home developer and squeezed into an area with the rest of the 18. The latest owner is clearly serious about keeping Kwini a popular alternative for the locals. The course was in fine condition, some of the holes – especially those shaped by P.B. Dye – were visually interesting, but you are always just a bit conscious about a bit of dissonance among the holes. Approach the course as 18 separate holes, and you will have an interesting day of it. And the staff could not be friendlier.
Others
Alburg Golf Links, Alburgh, VT…Rating 3.5
North Country, Rouses Point, NY…2.5
West Bolton Country Club, West Bolton, VT…4
Champlain Golf Club, Swanton, VT…3.5
Fox Run (formerly Okemo Valley), Okemo, VT…4
Hedge Against Covid:
Buy a Golf Course
If I were 15 years younger, had a spare $2.5 million, my friends and family wouldn’t force me into psychiatric care and my wife wouldn’t threaten to divorce me, I would buy and manage a golf course. Not any golf course, but a specific one I have played a few times in Vermont.
The course is Alburg Golf Links in the far northern part of the state, just a few miles from the Canadian border and — this is one of its biggest selling points – just an hour from metro Montreal and its 4.2 million inhabitants. As you may have read, the U.S. has reopened its borders to Canadians who love golf enough to fly to Arizona and Myrtle Beach every February to kick-start their golf seasons. Alburg Golf Links historically derived more than half of its green fees from Canadian visitors and its clubhouse proudly flies both Old Glory and the Maple Leaf.
Owning and managing a golf course ranks up there on the list of toughest ways to make a living. In northern Vermont, the golf season is five to six months long, lasting from the beginning of May to sometime in October, depending on how early winter arrives. The short season is mitigated, somewhat, by the fact that Alburg is the only golf course in the immediate area; the closest other layout is across the lake in New York State, about a 25-minute drive and, frankly, not as interesting or well conditioned as the Alburg layout, which deserves “classic” status. (The first nine holes opened almost 60 years ago, the second nine was added in the ‘70s.) The 68-year-old owner of the club was a successful businessman who has managed to make a go of his second business, although I suspect there have been some years when he was forced to subsidize it out of his own pocket. Alburg Golf Links is not just the only golf course in the area; it also houses the only restaurant in the town of Alburgh; the nearest eatery is a good 15 miles or so away. (I can vouch for the food after two lunches there.) And off the course is a gravel pit from which the owner generates some additional revenue.
The golf course occupies about 225 acres, leaving plenty of room for anyone who would like to build golf cottages beside it. But the real kicker for someone with a developer’s instinct is immediately adjacent to the course, 200 acres of forests and meadows that include a ridgeline from which future homes would have view of Lake Champlain. The entrance to the golf course is directly across the street from the lake and, straddling the driveway and behind the 1st green and 2nd tee box, are four lots whose homes would have commanding views of the lake and about a 50-yard stroll to the water’s edge.
There are plenty of other good reasons for my obsession with Alburg Golf Links, including the owner’s beautiful home on the highest point of the course, with drop-dead gorgeous views of lake and golf course and for sale at a reasonable price to anyone who purchases the entire 425 acres. But what about the golf course, you ask?
I have reviewed the course at my web site, OffTheBeatenCartPath.com, but here are a few short notes about my late August round at Alburg Golf Links. The greens reminded me of Donald Ross greens, except smaller, and because of their size, in some cases much more difficult to stay on. Although you know you are not in Scotland and Alburg is not a true links course, the burned-out fairways and small greens compel many punch shots you would play on true links courses. Alburg does not use a modern irrigation system but rather pumps water from the lake and an on-site collection pond (mostly for the greens, as the contrast in colors between putting surfaces and fairways was stark). The brown turf on the fairways was tight, and I did not feel the need to roll my ball over for a preferred lie. The rough was surprisingly lush in some places adding a bit of unpredictability to my drives. Alburg is not a long course at 6,500 yards from the tips. But for those of us who can’t bang drives much beyond 200 yards, the layout at just under 6,000 yards provides plenty of challenge, especially with those greens.
In fairness, a developer I know ran the idea of a purchase of the 425 acres by some of his fellow developers, at my request. They believed that, given the location and the idiosyncrasies of building a community so far north in a remote area, it would be too big a challenge. But someone is going to buy it eventually. And let us say the golf course has a value of $1 million, conservatively; then the 200 acres of land would cost $7,500 per acre. With a small community of homes just off the golf course property currently selling for around $500,000 each (with views of the lake at ground level), homes overlooking the lake from on high could be valued similarly. That seems to leave a lot of room for developing a community at a profit, especially if the prediction of continuing traffic to Vermont is accurate.
Between the pandemic, summer heat in the South and the rising seawaters and intensity of hurricanes along the coast, a second home in a perceived “safe” state like Vermont could become ever more popular in the coming years. Evidence is that the northward migration has already begun in earnest. Real estate prices in Vermont rose 45% from May 2019 to May 2020, although they have since fallen back a few percentage points. According to some reports, Vermont has experienced the third highest increase in real estate prices of the 50 states over the last two years. Those are not just second-home owners either.
It has been fun for me to think about the possibilities for the property – and to parry the mocking of my friends and family. If you have ever dreamed of owning a golf course and developing a beautiful property adjacent to it, please
