America's Recession-Proof Cities to Retire In

These affordable metro areas offer sunny weather, jobs and rosy economic outlooks.

The Miami-Ft. Lauderdale, Fla., metro area--which includes Broward, Miami-Dade and Palm Beach counties--has gained a reputation as a mecca for retirees. The south Florida sun shines on scores of condos that jut like vertical cruise ships from the emerald-tinged shoreline. Near the most luxurious of these residences, golf courses dot the landscape, poolside sunbathers enjoy the company of other seniors and gourmet meals are available via room service.

Yet Miami isn't quite the paradise it's thought to be. Thanks in part to a battered real estate market and high housing costs, it ranks 29th on our list of America's recession-proof places to retire, well behind top-ranked Atlanta. Our list, compiled by crunching seven sets of statistics from sunny days to median home price, reveals that Atlanta has many trends working in its favor--low cost of living, plenty of sun and housing that is affordable and projected to rise in value over the next five years.

"Atlanta is the financial and industrial center of the South," says Eduardo Martinez, senior economist at Moody's Economy.com. "With companies like Delta and Home Depot, it's home to more and more international business."

Four cities in the Lone Star State make the list. The Dallas-Ft. Worth metro area; Houston, just two spots behind it; Austin at No. 6; and San Antonio in the No. 10 spot. All three cities are benefiting from some positive Texan trends.

"In Texas, it was a relatively mild recession," says Martinez. "All our projections are for quite a bit of growth. In terms of job creation, more people are moving out there, and families are getting bigger. The fundamentals for Texas are a lot stronger than those of other peer large states."

Behind the Numbers

To form our list, we looked at the country's 40 largest metropolitan statistical areas and applied seven metrics.

Americans are living longer--the average life span has been increasing for a decade, rising from an average 76.5 years in 1997 to 77.9 in 2007, according a Centers for Disease Control and Prevention report released in August. As a result, retirees should be looking for reasonably priced homes that will appreciate in value. With this in mind, we looked at current median home price and five-year projected home price via data from Moody's Economy.com. We also included two important cost measures: median monthly housing expense from the Census Bureau and a cost of living index--for expenses unrelated to housing--from the Council for Community and Economic Research.

Since the U.S. economy is still in flux and some retirees may have to return the workforce in order to maintain their standard of living, we included two sets of employment statistics: median income for households over age 65, from the Census Bureau, and five-year job growth outlook from Moody's Economy.com.

Finally, since every retiree should get some sunshine in their golden years, we included sunny day statistics from the National Oceanic and Atmospheric Administration (NOAA).

Back to the Big City

Given the increase in American life expectancy, places like Atlanta should appeal to retirees who may have to rejoin the workforce or take out a home equity loan in order to finance unforeseen health care costs. The city boasts strong job outlooks--Moody's Economy.com predicts that Atlanta's job market will grow by 13.5% over the next five years, while home prices will expand by 13.4%. Buying low is easy: Atlanta's current median home price of $118,000 is seventh lowest among the 40 cities we considered.

Third-ranked Tampa-St. Pete also offers double-digit projected growth in both median price and employment. With a median monthly living cost of $975, 10th best among the country's 40 largest metros and a current median home price of $133,000, Tampa is also very affordable.

Metros like Tampa and Atlanta are more attractive retirement destinations than they used to be. It used to be that retirees sought to move far away from the large urban areas they once worked in, hoping to ditch the city grind in favor of more bucolic pursuits. Lately, the trend has been working in the reverse.

"Empty nesters are definitely taking advantage of the cheap condo prices in big cities," says Ken Shuman, spokesman for real estate site Trulia.com. Indeed, both Tampa and Atlanta offer a median home price below $140,000, and there are many downtown condo bargains among them. "Baby boomers never had that city-living experience. It's a great opportunity for them to have that chance as they get older and enjoy the things cities have to offer. It's definitely a trend that we're seeing."

Shuman notes that retirees are interested in the ease of downtown living--being able to walk to a nice restaurant, having the chance to go out to see a play without having to get into a car and enjoying full-service life in doorman buildings.

In today's economy, city living also makes more financial sense for those looking to downsize from sprawling suburban mansions--especially for those who plan on working for a few more years.

"If you're approaching 50 and the kids have moved out, you don't need the square footage," says Martinez. "In terms of saving money, there's a benefit there. If you live in the city and your job is there, you don't need to keep up on car payments anymore."

Top 5 Recession-Proof Cities to Retire In

© Gennady Stetsenko / iStockphoto

1. Atlanta, Ga.
(Atlanta-Sandy Springs-Marietta, Ga., metro area)

Sunny Days: 17 of 40
Income 65 And Over: 17 of 40
Median Home Price: 7 of 40
Projected Home Price Growth '09-'14: 17 of 40
Projected Job Growth '09-'14: 5 of 40
Cost of Living: 11 of 40
Median Monthly Housing Cost: 23 of 40

© Andrew Dean / iStockphoto

2. Dallas, Texas
(Dallas-Fort Worth-Arlington, Texas, metro area)

Sunny Days: 16 of 40
Income 65 And Over: 10 of 40
Median Home Price: 17 of 40
Projected Home Price Growth '09-'14: 35 of 40
Projected Job Growth '09-'14: 3 of 40
Cost of Living: 6 of 40
Median Monthly Housing Cost: 16 of 40

© Marek Gahura/ iStockphoto

3. Tampa, Fla.
(Tampa-St. Petersburg-Clearwater, Fl., metro area)

Sunny Days: 9 of 40
Income 65 And Over: 35 of 40
Median Home Price: 10 of 40
Projected Home Price Growth '09-'14: 22 of 40
Projected Job Growth '09-'14: 11 of 40
Cost of Living: 10 of 40
Median Monthly Housing Cost: 10 of 40

© VanHart / Shutterstock

4. Houston, Texas
(Houston-Sugar Land-Baytown, Texas, metro area)

Sunny Days: 21 of 40
Income 65 And Over: 18 of 40
Median Home Price: 15 of 40
Projected Home Price Growth '09-'14: 33 of 40
Projected Job Growth '09-'14: 4 of 40
Cost of Living: 4 of 40
Median Monthly Housing Cost: 13 of 40

© David Sucsy / iStockphoto

5. St. Louis, Mo. (tie)
(St. Louis, Mo.-Ill.)

Sunny Days: 26 of 40
Income 65 And Over: 27 of 40
Median Home Price: 6 of 40
Projected Home Price Growth '09-'14: 29 of 40
Projected Job Growth '09-'14: 17 of 40
Cost of Living: 3 of 40
Median Monthly Housing Cost: 4 of 40

© Mike Liu / iStockphoto

5. Austin, Texas (tie)
(Austin-Round Rock, Texas, metro area)

Sunny Days: 17 of 40
Income 65 And Over: 4 of 40
Median Home Price: 24 of 40
Projected Home Price Growth '09-'14: 34 of 40
Projected Job Growth '09-'14: 1 of 40
Cost of Living: 14 of 40
Median Monthly Housing Cost: 18 of 40

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