Retiring in a Million Dollar home or a Multi-million Dollar Home

[kgtest]

Quote:

Originally Posted by Willers The value of our home has nothing to do with our lifestyle. I don't think the two necessarily go hand-in-hand.

This was the most surprising thing I learned when I moved onto McMansion street. Most of my neighbors have like super low electric bills, are fairly conservative financially with 10+ year old vehicles...but damn do they love there little show dogs LOL!

[T-Minus]

When I retired, we downsized from a large and greatly-appreciated home, and bought a single-level smaller home in a medium-upscale area in the low $800’s and saved/invested the difference. However, over the past couple years, property values have gone crazy here, to the point where homes in our neighborhood are now selling for > $1MM. Does that make us retirees in a $1MM home? Many of our neighbors are part-time residents (i.e. Snowbirds), who bought when these homes were in the $600k range - we’ve only met two couples who have bought at the top and use their home as a part-time residence. They both were small-business owners who sold their businesses...

[ncbill]

Grew up in a large (~6,000 sqft.) 1920s home here in flyover country.

Watched mom nearly go broke trying to keep it up after the divorce...forced to sell it just a few years later.

Recently sold for $1.5 million...fond memories, but I wasn't paying the bills.

Would not buy it today even had I $10 million in the bank...getting my recently deceased relative's 1930s home ready for sale has been a PITA.

No older homes for me, happy with my low-maintenance ~2500 sqft. 1990s townhouse.

[marko]

Quote:

Originally Posted by Breedlove Why do you want a million dollar home , the taxes could be dead money you could use for other things . ... a million dollar home requires a lawn company and lots of other upkeep .

When I found this forum many years ago I fully expected to find FI people with not only multi-million dollar homes but perhaps two.

I would also assume there's a certain FI demographic where paying one's property taxes and home upkeep is not something that would force tough decisions on the rest of their lifestyle. My neighbor spends about $30K annually on landscaping (includes snowplowing).

To each his own!

[timemoveson]

Quote:

Originally Posted by marko When I found this forum many years ago I fully expected to find FI people with not only multi-million dollar homes but perhaps two. I would also assume there's a certain FI demographic where paying one's property taxes and home upkeep is not something that would force tough decisions on the rest of their lifestyle. My neighbor spends about $30K annually on landscaping (includes snowplowing). To each his own!

+1!

[kgtest]

Quote:

Originally Posted by marko When I found this forum many years ago I fully expected to find FI people with not only multi-million dollar homes but perhaps two. I would also assume there's a certain FI demographic where paying one's property taxes and home upkeep is not something that would force tough decisions on the rest of their lifestyle. My neighbor spends about $30K annually on landscaping (includes snowplowing). To each his own!

They are too busy blwoing their dough cutting muktiple 30k landscape checks...one for the lake house and one for the homestead. Getting on and off there NetJets and eating all that fine dining at night.

And keeping up with all that classic car and super car maintenance schedule. Well in between travelling to Maldiv, Bali and spending time in the Mediterranean on the MegaYacht, of course.

[marko]

Quote:

Originally Posted by kgtest They are too busy blwoing their dough cutting muktiple 30k landscape checks...one for the lake house and one for the homestead. Getting on and off there NetJets and eating all that fine dining at night. And keeping up with all that classic car and super car maintenance schedule. Well in between travelling to Maldiv, Bali and spending time in the Mediterranean on the MegaYacht, of course.

My point was that not everyone who is retired has to watch every penny, making a choice between paying high taxes and dinner at Red Lobster.

There are some truly wealthy retired people out there....and some who never had to work at all.

[Teacher Terry]

I never understood moving away from a place you love just to buy a huge house somewhere less desirable. The people I know that did this aren’t happy. Now it’s different if you want to or have to. I have moved enough in my lifetime.

[tb001]

Quote:

Originally Posted by marko My point was that not everyone who is retired has to watch every penny, making a choice between paying high taxes and dinner at Red Lobster.

Yes! And for many RE is a choice. One they don’t want to make unless it allows for the lifestyle they’re looking for. Personally, I would make a ton of changes to lifestyle to RE, my DH not so much.

[kcowan]

Being in Vancouver, our level of house equity has to be over $10 million to qualify for this inquiry. We also have Chinese nationals who own such places and are absent most of the time. We expect a further influx from Hong Kong this year.

There are an estimated 300k "Canadians" living there now.

But people whose home equity has grown in place to such levels are not likely of interest here.

[NW-Bound]

Quote:

Originally Posted by marko When I found this forum many years ago I fully expected to find FI people with not only multi-million dollar homes but perhaps two...

Multiple multi-million homes? I only need one.

Waterfront homes on Bainbridge Island with the view of the Seattle skyline across the Puget Sound are cheap compared to homes in Vancouver and in Mountain View.

Life is more quiet there too, compared to the above places. When I want to get into town, a ferry ride will take me to Seattle International District if I feel like having Asian food. Most of the days, I would be happy just rowing my canoe out to check on my crab pots to see if I get anything for dinner.

If I continued to work at megacorp instead of leaving at 40, I could easily have had my own place. But I don't know how to do ER and get a waterfront home too.

[ExFlyBoy5]

Just a little morsel of "gee whiz" info: The author of Millionaire Next Door purchased his upscale 5500 SF home outside of Atlanta in 2001 for just under $900K and the assessor shows it at $1.2m today. It is one of the nicer communities in the NW 'burbs of Atlanta. His daughter (and co author of the new version of the book) lives a couple of neighborhoods down from where we lived...they run in the 500'ish range which is pretty reasonable for the area.

As for us, we paid more than I normally would have for our house and is valued higher than most of the houses in our zip code. However, we intend to stay here for a pretty long time and it's got all the things we would want for "aging" in the home. We figured out pretty quick that even though it was more expensive than we were originally going to spend, it was still much, MUCH cheaper than building something similar.

The only downside is that the lot is shy of 2 acres and is mostly grass. The 18 zone irrigation system runs for 3 hours a night to keep stuff alive in the blistering heat. Thankfully, I can mow most of the yard with our riding lawn mower and we have a well...so we aren't paying hundreds of $$$ on water running the sprinklers.

[FreeBear]

Quote:

Originally Posted by MRG There's many multimillion dollar vacation homes that sit vacant 50 weeks of the year where we live. They probably belong to the same folks that fly in on private Learjets.

Out on the local Big Lake, we love to stare at the huge lakefront estates. I hear they start at 5-10 mil. Never see anyone except the lawn guys or other contractors. It’s nice to enjoy from the water without much cost.

Have a couple of friends in decent homes, but about a mile off the water. These run around $500k.

[daylatedollarshort]

Many of the $1M - $2M houses in the Bay Area suburbs we live in are just 3 - 6 bedroom, 2 bath tract type homes. But there are some pretty rich families as well. One of our kids was at a classmate's house for a school project and inside it looked like the mansion on the Beverly Hillbillies, only this house had not one but two grand stair cases, and out back next to the "cement pond" was a full size basketball court and pool house. That is the most expensive house I think I've ever been in, at least as a guest and not a tourist.

[dirtbiker]

I had always figured I would move into an expensive large home, keep upgrading as my income increased, and eventually end up retiring in a $million+ home. In fact, only a few years ago while I was in residency, I was already looking at homes 2-3 times the cost of my current home.

However, I got smart and realized I didn't want to become house poor. Instead of buying a new larger home, I added a bedroom and did some remodeling, did everything myself to keep costs low, and my estimated home value increased more than the cost to remodel. My house is nice, but not grandiose by any means. Most probably wouldn't think it was a doctor's house, but I'm completely fine with that. In fact, my secretary has a larger more expensive house than I do. Again, I'm completely fine with that.

We funneled the additional money we would have spent on a bigger house into investments and paying down the mortgage. Now I can't envision myself in an expensive mansion ever, even after retirement. It seems like a big waste of money that I'd rather put toward retirement now and after retirement toward traveling.

[rodi]

I live in a 55 year old tract home, about 2000sf. We aren't walkable to the beach - but it's a short, 10 minute drive. We are adjacent just east of a very ritzy neighborhood (La Jolla) and have great schools, and a central location.

Our 55 year old tract home is worth over a million. It's ridiculous that it's worth that much... but it's paid off, and with Prop 13, we don't have the high taxes associated with expensive properties. It was the house I grew up in, and raised my kids in after we bought it from my dad when he was downsizing.

The value of the house is in the dirt it's on... and people are starting to buy the homes and rebuild from scratch... that's happened to a few homes in my subdivision. I guess with that much money people want new construction McMansions rather than an older tract home.

Since I don't count the home value as part of my nest egg - the value is irrelevant. ... at least until we sell or downsize. In the meantime it's a great middle class style house in an older neighborhood in a great part of town. And if we ever need to both go into long term care - this is our plan to pay for it.

[gwraigty]

Quote:

Originally Posted by Bamaman We thankfully live in an ultra LCOL area. Spend $1 million here and you've got a seriously large and luxurious home.

+1

And major lakefront property with your own private boat dock.

[HI Bill]

Quote:

Originally Posted by Aerides But no, I don't think you'll find any "MND" types who go out and intentionally buy a 1M property today. The only exceptions would be someone who is still earning, and whose business depends on those locations. I doubt you'll find anyone here who - already retired - then picked a 1M house.

I've been renting rooms and living in small condos all my adult life....after I travel internationally for a couple of years, my plan is to buy a $1-1.5M house on Hawaii Island. Don't really want to spend that much, but anything under $800K here is just not that nice, generally. LBYM, so I can do deferred spending!

[Mr. Tightwad]

My home is worth over a million. Bought in 1998. Property taxes low thanks to prop 13. So is one of my rentals. And I don't have a gardener for either.

[ABQ2015]

Quote:

Originally Posted by wolf Location has to be taken into consideration. I also, live in San Francisco Bay Area. My "blue collar", 1400 sq. ft. house cost me $130,000, 35+ years ago. Today, selling for $ 1,600,000. My life style comfortable. Nothing fancy. Could not afford to live here today, if I had not bought years ago.

Just for comparison, I bought a 1300 SF home in 1990 in Albuquerque for $85K and it is now estimated at $250K on Zillow. The sellers were being transferred by their employer to the San Francisco Bay Area.