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View Poll Results: Was/is your forever home INFLATION ADJUSTED...
The most expensive home/homes weíve ever owned 73 45.34%
The same or less expensive home/homes, or the same home (didnít move) 88 54.66%
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Poll: Did You Retire in your Most Expensive Home?
Old 10-02-2018, 06:58 AM   #1
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Poll: Did You Retire in your Most Expensive Home?

We’re planning on relocating and buying a “forever home” that’ll cost significantly more inflation adjusted than any house we’ve ever owned, about 160% of our current homes valuation. Property taxes and general expenses will go up about the same.

I’m still having a tough time with it, especially since owning homes well below our means helped us achieve FI early. And conventional wisdom seems to be downsize and reduce housing costs in retirement, some folks even plan on cashing in some home equity to enhance their nest egg.

OTOH DW says she wants this house to be exactly what she’s always wanted (not unreasonable IMO), and the numbers say it’ll be (comfortably) within our retirement spending projections - unless returns are much worse than ever. She doesn’t worry about what we can afford, she considers that my responsibility...and I’d never mislead her.

Neither one of us wants to stay where we are or further renovate the current dump house.

If you bought a second home in retirement, use total value vs prior home.

For those who traded up $ wise for your forever home/homes, any regrets?

For those with rental properties, this poll probably doesn’t apply.
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Old 10-02-2018, 07:09 AM   #2
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What difference does it make if the new house is more or less expensive than your current home? What matters is affordability and how it impacts your budget.
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Old 10-02-2018, 07:12 AM   #3
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"OTOH DW says she wants this house to be exactly what sheís always wanted"

There's the only poll that matters.

"and the numbers say itíll be (comfortably) within our retirement spending projections"

So why not?

I don't understand why people worry about what other people think/did?

-ERD50
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Old 10-02-2018, 07:14 AM   #4
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No regrets. Our current home, purchased six years into FIRE, was 50% more expensive than the selling price of our prior home, but it also came with a complete change in lifestyle that is hard to put a price value on. In addition to getting the coastal-close view location we'd long desired, we are able to play daily at the beach, always temperate here in S. California, and that has resulted in unexpected savings elsewhere. Our utility bills are lower due to cooler climate, as is our EQ insurance (we're now further from a major fault line), we do less fine dining in that we prefer to eat out in our lovely backyard, and less travel due to still much enjoying our new geographic location. Should any of these things change for the negative at some point, we can always sell and relocate either elsewhere, or to someplace less expensive. We won't regret our years here, regardless.
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Old 10-02-2018, 07:14 AM   #5
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Quote:
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What difference does it make if the new house is more or less expensive than your current home? What matters is affordability and how it impacts your budget.
+1 this is all you need to know.
Quote:
Originally Posted by Midpack View Post
.....the numbers say it’ll be (comfortably) within our retirement spending projections...
not only that, while your principal reason for buying is to live there, as a byproduct it is a quasi investment and will hopefully appreciate in value.

Our current main home that we moved into 6 months before I retired... our "retirement" home.... is worth twice what we sold our former main home for 7 years ago... despite being less square footage.... but it is what we wanted where we wanted and we can afford it... so no worries.
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Old 10-02-2018, 07:18 AM   #6
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What difference does it make if the new house is more or less expensive than your current home? What matters is affordability and how it impacts your budget.
As you know, nest egg>35 year retirement income isn’t an exact science. “Affordability” is a set of probabilities at best. Don’t we all have a safety factor we’re comfortable with?

e.g. I’d never withdraw 4%, others do...
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Old 10-02-2018, 07:27 AM   #7
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^^^ but at the same time, SWR's are pretty much based on really unlikely scenarios, so it is more likely than not that people with a 4% WR will die rich...

From the Trinity study:
Quote:
For stock-dominated portfolios, withdrawal rates of 3% and 4% represent exceedingly conservative behavior. At these rates, retirees who wish to bequeath large estates to their heirs will likely be successful. Ironically, even those retirees who adopt higher withdrawal rates and who have little or no desire to leave large estates may end up doing so if they act reasonably prudent in protecting themselves from prematurely exhausting their
portfolio.
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Old 10-02-2018, 07:32 AM   #8
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No, not the most expensive house but it is definitely in the most expensive place we've lived so far with probably the least amount of services. That being said it is in an area for the activities we enjoy most.

FWIW: The assessor here definitely thinks it's worth way more than I do...!!!!!!!
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Old 10-02-2018, 07:32 AM   #9
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We shuffled our two previous homes into two different ones. 56% more total for the new ones including decorating and furnishing two different place. Not a big deal, still earn more than we spend even after increased expenses.
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Old 10-02-2018, 07:37 AM   #10
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As you know, nest egg>35 year retirement income isnít an exact science. ďAffordabilityĒ is a set of probabilities at best. Donít we all have a safety factor weíre comfortable with?

e.g. Iíd never withdraw 4%, others do...
My post wasn't intended as a challenge. Safety is something different and very personal for each of us. Some people are comfortable standing at the very edge of the cliff while others prefer to remain a few feet back.

With this purchase are you still comfortably safe, or does that move you from "safe" to "safe-ish"? One aspect of the "perfect" house is you sleep well at night.
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Old 10-02-2018, 07:40 AM   #11
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We're planning on relocating in a couple years. The plan is to have fewer square feet than we currently do.

Always thought that would mean buying a house valued less than our current one, but the housing market in our new location is expensive, and we will likely be paying more for the next house than the current one, despite the smaller size.

Won't be a great deal more expensive, and it should appreciate in value faster, so not something that bothers me all that much.
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Old 10-02-2018, 07:40 AM   #12
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We just moved into a house on a lake in Central Florida in July. It is only 0.5 miles from our previous home we had lived in for 10+ years, and in the same 55+ golf community. But...the lake view is fabulous with a huge covered lanai and lovely gardens, and that's what we both wanted. It's about 200 sq ft larger(1950 sf total), is a more recent build, and was indeed much more expensive than our previous home, and the most expensive home we've owned. We feel very lucky to not need a mortgage, and didn't need to touch any of our investments.

No regrets, but moving has been a lot of work. We're just now starting to feel settled in.
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Old 10-02-2018, 07:41 AM   #13
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I don't understand why people worry about what other people think/did?
Because other people might have insights from experience that others haven’t had yet. Isn’t learning from each other what this and most forums are for primarily?

If it doesn’t float your boat, no worries. It would be impossible for every thread and post to appeal to every reader.
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Old 10-02-2018, 07:42 AM   #14
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No regrets. Our current home, purchased six years into FIRE, was 50% more expensive than the selling price of our prior home, but it also came with a complete change in lifestyle that is hard to put a price value on. In addition to getting the coastal-close view location we'd long desired, we are able to play daily at the beach, always temperate here in S. California, and that has resulted in unexpected savings elsewhere. Our utility bills are lower due to cooler climate, as is our EQ insurance (we're now further from a major fault line), we do less fine dining in that we prefer to eat out in our lovely backyard, and less travel due to still much enjoying our new geographic location. Should any of these things change for the negative at some point, we can always sell and relocate either elsewhere, or to someplace less expensive. We won't regret our years here, regardless.
Lovely post, thanks!
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Old 10-02-2018, 07:59 AM   #15
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Sold our home in an expensive NYC suburb for a similar sized home in Eastern PA. The original house was old, 3 levels, high property tax, etc. The new house is brand new with customizations the DW wanted, on one level, energy efficient, and lower costs overall. It's in a 55+ SFH condo community so there is no more mowing, raking, or shoveling. Even cleared a pretty penny on the old house to add to our savings.
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Old 10-02-2018, 08:11 AM   #16
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No, not the most expensive home. It’s nice and sort of luxury but not the most luxury. Our area is like living in a resort in Hawaii. But the property tax is the highest we pay.
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Old 10-02-2018, 08:42 AM   #17
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We moved into our "forever" home 20 months ago and it is not the most expensive house we've bought but is much larger than we really need. We bought it for several reasons including location and the fact it gives us plenty of space, especially when we have family or friends staying.
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Old 10-02-2018, 09:16 AM   #18
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For the first 15 years of our retirement (1989-2004) we lived 6 months in our Woodhaven Campground, in Illinois, and six months in our Lake Griffin Harbor 55+ Community in Leesburg FL.
In 2004, we bought into our CCRC, Liberty Village in Peru, Il. At that time, our home cost $140K... Now valued @ $180K. It's where we live today, 'til it's time for us to move into the apartments.

But... on a totally different note, we bought our first home in Falmouth, Mass. 78 Oakwood Ave, in 1966. That cost $12,500 plus $1,500 for renovations. Looking that up on Zillow... the same house, today... $527K. Zillow shows it as being built in 1982, but the real date was 1940.... I looked it up on Street Scene, and for sure, it's the same house. Go figure... Same increase for all of the rest of the houses on that street.

https://www.zillow.com/homedetails/7...55892680_zpid/
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Old 10-02-2018, 09:17 AM   #19
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At the time 30 years ago, this seemed like a very expensive home. What made the purchase possible on the household income was the appreciation of the prior home. The mortgage made everyone nervous, although the interest rate was much lower than on the prior home. Now you can't buy a studio condo in the worst part of town for the purchase price.

A smaller and newer house in a less crowded but more attractive area is certainly appealing. This house is now of an age where maintenance and repairs are constant worries. However, the tax consequences of selling this house would be very costly. Buying down and renting out this house remains on the table.
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Old 10-02-2018, 09:25 AM   #20
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The only house so far...

To paraphrase Jerry Reed: Iíve got a house thatís mine alone, that me and the finance company own...
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