Expensive Retirement Home

[haha]

Location, location, location. All other things being equal, personally I would look either for the highest appreciation or the least likely to depreciate home. We noticed after 2008 that in our metro area some cities went down 50% in average home prices and other cities barely registered any price dip.

This is so true.I experienced the aerospace debacle of the early 70s, as well as mean recessions in the early 80s. After this until 2007, Seattle real estate was somewhat stabilized by tech hiring and inflow of workers.

However, in every case, the losses or more likely drawdowns were much worse in outer areas. Blue chip areas like Hunts point and Medina and West Bellevue on the eastside, and similar blue chip expensive neighborhoods in Seattle proper. Sometimes a more marginal area will do better %wise during the upturn, but rarely or never on the down slope.

Still, I agree with Day Late and others above, Texas and Las Vegas could not be more different. I also cannot understand how you expect to get any useful information out of saying "a suburb in Las Vegas, or a suburb in Texas". All these palaces have names, and I doubt a stalker will bother or be able to follow your moving van and set about taking your money even if you do identify where you are talking about.


Ha

 

[yakers]

I can walk down to the Truckee in 5 minutes and fish and Tahoe is about half an hour to forty minutes away--but it's a lot less expensive than Tahoe.

Does it ever snow there

 

[RE2Boys]

Anything that requires more of my time to maintain (unless it your hobby) decreases my quality of life. So a larger home, unless I have the means to contract all maintenance out, decreases my quality of life.....I'm not free to do the things I want to do. I'd include the time to supervise the contractors/make arrangements as part of maintenance activities.

Just my feeling on the subject and opinion, but I suspect many others feel the same way as I have met several retired folks recently selling the main home to move to a condo or patio home community.

 

[RunningBum]

Does it ever snow there [Truckee]

Ha! Google the Donner party. Not far from there, I'm pretty certain.

Quick answer from a google search, 200+ inches on average, but only from Sept to June!

 

[RunningBum]

If this were strictly a financial decision, you'd buy the cheapest combination of purchase price, upkeep, and taxes that you could safely live in. Since you're talking about an expensive house, you're clearly beyond that. Location is far more important than having a few extras in the house, so you need to spend time in locations you are considering to decide where you want to be, and then you can scale up or down your house to fit that location. Spend time in places in the mindset as a resident, not a vacationer.

 

[RobLJ]

Does it ever snow there

Averages 23 inches of snow a year in Reno.

(Truckee, CA is different since it's higher and closer to Tahoe. Lots of snow there.)

 

[NW-Bound]

Olympic Valley is 5 miles west of Lake Tahoe. This ski resort was the site of Winter Olympic 1960, and usually gets 40 ft of snow a year. We were there 2 months ago. Nice town, but there are few full-time residents.

 

[pb4uski]

Again, thanks for all who have shared their thoughts and experiences. Here's a somewhat related question.

Would you rather buy a cheaper home with relatively high property taxes or a more expensive home with low property taxes. To use a concrete example, let's suppose there's an 800k home with 17k per year property taxes and a 1mm home with 7k in property taxes. You're really happy with both.

How would you look at it? Thanks....

I agree with DLDS that this is more a lifestyle decision than a financial decision so you need to use your heart rather than your head and focus on which location "feels" right for you.

If it were a financial decision then I would probably be indifferent, all else being equal since the opportunity cost of the extra $200k of investment at 5% is the same as the difference in the property taxes.

 

[Texas Proud]

I agree with DLDS that this is more a lifestyle decision than a financial decision so you need to use your heart rather than your head and focus on which location "feels" right for you.

If it were a financial decision then I would probably be indifferent, all else being equal since the opportunity cost of the extra $200k of investment at 5% is the same as the difference in the property taxes.

That is if you pay cash... but I bet there is a mortgage involved and the opportunity cost are much smaller...

You also have the opposite side... say both go up 10%.... the $1 mill property goes up more than the $800k in dollar terms...

 

[Danmar]

I agree with DLDS that this is more a lifestyle decision than a financial decision so you need to use your heart rather than your head and focus on which location "feels" right for you.

Yes, I think you should view all personal use property as a place to live rather than an investment. Buy what will be the best place to live within your budget.

 

[kcowan]

Yes I think that anyone who is mortgage poor in retirement does not understand risk management. Allocate a % of your total return to accommodation and stick to it. IF you have a second home (or RV), apportion part of your travel budget to its maintenance.

When we had a big 5000 sq.ft. home before downsizing, I split the cost between lodging expense and speculative investment ($320k half and half). The home value peaked at $1050k at the nine year mark and my family resisted my desire to downsize and move 10 miles further out to a lake. Seven years later, we sold for $535k so my speculative return was (535/160)-1 or 6.5% per year (but we could have made a much bigger return at a cost of personal disruption).