There is no substantive reason why you have to stop using your home as an investment as you go into retirement. In my most recent private letter to my secure email group I shared how we have set ourselves up in our first retirement home in Idaho with an immediate equity gain due to it being a short sale property one year previously.
We were happy to do it this way since the seller had already been through the intense process of negotiating with the bank. We got the house for less than what they had paid once we considered the $21,000 professional landscaping project they completed. We watched the Boise homes market closely for 18 months to find the right home. Internet know-how makes this easy now a days.
As much as I appreciate all our real estate brokers over the years, keep in mind that they always have a "conflict of interest" as they negotiate on your behalf. Listen to their counsel but take charge and make your own decisions when it comes to negotiations.
If you go after a foreclosure or short sale, be prepared to walk away when the business process gets pushy. You will almost always hear that another potential buyer's offer is about to be on the table as they try to get you to settle on a price. Don't let your emotions govern your decisions.
If you know what to do you can make 10's of thousands of dollars as you buy your next home. We picked up $60,000 equity the day we signed our new home papers in Boise last week. If invested wisely, at 5% draw that can be an inflation proofed addition of $3000 in retirement income per year for perpetuity. Not a bad bonus.To get more detail about this and other investment strategies you can join my secure email group by signing up in the box to the left of this post: http://saferetirementfreedom.blogspot.com/