How many of you have 2 houses?

[Loop Lawyer]

There is a lot of wisdom in the posts above!

DW and I have an apartment in downtown Chicago (rented), a year-round house on the beach in Michigan (owned), and the contents of a 3BR house in storage (one consequence of leaving suburban Detroit in favor of Chicago).

The plan has been -- and is -- to find the "right" residence to buy in the south, probably in Florida, then fill it with the stored goods (and, eventually, apartment contents). The Chicago apartment is a "work city" living arrangement that will go away when I decide to call it quits. We can then "snowbird" between Lake Michigan and Florida -- we know many who do this and recommend it.

We are definitely LBOM. But the multiple properties do concern me from a "hassle" standpoint. And there are hurricanes in Florida.

If I could figure out a way to minimize the hassles, I would be happier with my own plan. Maybe a Florida condo is the answer. Minimal maintenance. Lock it and leave it! We rather like apartment living and preliminarily believe that a condo unit of 2,000 square feet or so would be "plenty of room" for a "permanent" (i.e., six-month-plus) residence for a couple. Any thoughts about that?

 

[BTravlin]

Dream would be to sell southern most home and live on a boat in the BVI during winter months.

Now there's a dream I could go for! But DW? Not so much.

 

[FANOFJESUS]

I am a fan of the rule of one
one wife over a lifetime
one house
one car

 

[vicente solano]

A small flat in the city (not rented) and a house in the country, 10 km away, much larger and more confortable and with an insignificant mortgage. As long as we have the Belgium shepherd -now 10 years old- we´ll stay in the country. There are times that I miss the city.

 

[52andout]

I have a question. When I read through our house insurance documents (yes, I read all the contracts for everything) I am almost sure there was wording that the house could not be vacant for more than 30 days.

We have one house, paid for, pretty much just as we like it and haven't had much desire to get another. Lots of our friends are picking up properties in Florida very cheap, but I think they forget the hurricane problems they had not too long ago.

 

[Ronstar]

If I could figure out a way to minimize the hassles, I would be happier with my own plan. Maybe a Florida condo is the answer. Minimal maintenance. Lock it and leave it! We rather like apartment living and preliminarily believe that a condo unit of 2,000 square feet or so would be "plenty of room" for a "permanent" (i.e., six-month-plus) residence for a couple. Any thoughts about that?

A condo would minimize the hassles. No maintenance. Some complain of HOA fees, but i pay far less in HOA fees for our condo than i pay in yearly maintenance on our house. also low insurance costs since you only have to insure contents. We love our condo -1350 sf for my DW and I is ample, so 2000 sf should be ok. if you get nervous leaving it, just get a remote camera system and periodically check it via the web.

 

[friar1610]

A small flat in the city (not rented) and a house in the country, 10 km away, much larger and more confortable and with an insignificant mortgage. As long as we have the Belgium shepherd -now 10 years old- we´ll stay in the country. There are times that I miss the city.

You sound like you have the situation I always thought would be ideal if I had more money. I'd love to have a small apartment/condo - 1 BR would be fine - in Boston, New York City or Montreal. And a larger house on the coast of Maine, Cape Cod, the shores of Lake Champlain, the RI coast, etc.

The West Coast version would be an apartment in SF, Seattle or Vancouver and a bigger place on the Monterey Peninsula, Mendocino or some other neat place.

 

[KingB]

We bought our second home in Henderson last Jan 2010 and I have a question on the $6500 long time homeowner tax credit. I meet the following:
1. Own the older house 5 out of 8 years
2. Close before the deadline (April?).
My question is:
Is there a time limit as to when you should declare the newer house as your primary residence or move in to the house. Since I am just retiring at the end of the month, we really have not been living in the 2nd house. We have moved a lot of stuff into the house to make it fully functional. Since we closed, we only have visited the place 8 times.

 

[traineeinvestor]

I am a fan of the rule of one
one wife over a lifetime
one house
one car

My wife is also a fan of the first limb of the rule.

We have our home in Hong Kong.

I also purchased a house in New Zealand intending to live there for 2-3 months a year after I retired. It didn't take long for me to conclude that it made a lot more sense to rent the house out and spend the income on serviced apartments.

 

[NW-Bound]

We have two houses in the same state, and they are only 2.5 hours of driving apart.
One is at 1300ft (400m) elevation. Temperature now: 70F high, 46F low (21C/8C).
The other at 7000ft (2130m) elevation. Temperature now: 43F high, 13F low (6C/-11C).
One has a record high in the summer of 122F (50C) . The other has a record low of -25F (-32C).

Initially, when buying the 2nd home (the one in the "mountain"), I thought we would be living there full-time after full retirement. But I realize now that I still need the amenities of the metropolitan, plus the winter there can be bone chilling. So, we may just keep both to play snowbirds.

And then, I sometimes wonder if all I need would be the small 8'X26' motor home to go camp out in the New Mexico mountain. Still not sure what I want to do.

 

[jacob]

I figured I could have either more bedrooms and bathrooms or more retirement years but not both. I didn't pick the rooms.

 

[jimnjana]

We have 3, a primary (FL), a vacation rental (SC) and one in GA that we are currently renting.

 

[xyz]

We have a house in the Northeast, considered buying a second in an warmer climate, DW could not make up her mind so we bought a 43' motorhome. On retirement we are planning on purchasing a lot with a casita in a resort for the motorhome (in the south) and downsizing the home in the northeast. Objective will be to have minimal maintenance and operating costs. But to answer the original poster's question yes, this is all part of our retirement plan.

 

[tryan]

We built a second home on a small lake in ski country 5 years ago. It rents short term (2 night minimum) via VRBO and Homeaway. In roughly 4 months (July and August then Jan and Feb) I can pull in the annual expenses for the property. Then we have the house rest of the year.

Whats interesting is that the second home is most stable asset we own. The value of waterfront homes has dropped some but not nearly as much as other rentals I have. And the volitility of the price is nothing compared to the mutual funds I've carried over the same 5 years.

 

[nothingevertodo]

Tryan- Do you mind sharing a bit more about your VRBO success? Where is the rental located? Cost/Size of house? Carrying a note?

Most of the VRBO owners I've heard of say that they are losing money every month!

 

[jimnjana]

Tryan- Do you mind sharing a bit more about your VRBO success? Where is the rental located? Cost/Size of house? Carrying a note?

Most of the VRBO owners I've heard of say that they are losing money every month!

We have had very good luck with both VRBO and Vacationrentals, Homeaway has been useless. We've had so much success with the SC property that rather than sell our Atlanta Home as we planned, we will likely market it as a vacation rental and try to capture some of the executive rental business as well (we will need make some improvements). We currently have it listed on VRBO and have received over 50 inquiries, and several thousand hits on the listing page, in about 4 months.

 

[nothingevertodo]

We have had very good luck with both VRBO and Vacationrentals, Homeaway has been useless. We've had so much success with the SC property that rather than sell our Atlanta Home as we planned, we will likely market it as a vacation rental and try to capture some of the executive rental business as well (we will need make some improvements). We currently have it listed on VRBO and have received over 50 inquiries, and several thousand hits on the listing page, in about 4 months.

Thanks for sharing! When you say good luck, would you say that it is providing a better return than had you rented it at a prevailing market rate year round?

 

[BTravlin]

We have had very good luck with both VRBO and Vacationrentals, Homeaway has been useless. We've had so much success with the SC property that rather than sell our Atlanta Home as we planned, we will likely market it as a vacation rental and try to capture some of the executive rental business as well (we will need make some improvements). We currently have it listed on VRBO and have received over 50 inquiries, and several thousand hits on the listing page, in about 4 months.

I have a vacation rental in Mexico that was listed on both VRBO & HomeAway but I recently let the HomeAway listing expire. I got more inquiries via Homeaway but virtually no bookings. Don't get as many inquiries with VRBO but have a much higher ratio of bookings to inquiries. I'll have to check the Vacationrentals site out. How does it compare on bookings per inquiries vs VRBO?

 

[brewer12345]

We own a single house. I had a hankering for a getaway place for a long time and we scratched that itch in 2008 by buying a small travel trailer for peanuts. Now we are looking at relocating to an ESR destination in 3 years and I am starting to wonder if I want to buy a place there ahead of our target move date. Obviously it would cost more to maintain two homes (suppose we could rent the one in the future location, but it is 1800 miles away), but at some point the RE market will have bottomed and I can still get a 3.5% pen fed mortgage with no closing costs.

Thoughts? My initial reaction is that this would be too much hassle, but I would welcome any thoughts on the subject.

 

[W2R]

We own a single house. I had a hankering for a getaway place for a long time and we scratched that itch in 2008 by buying a small travel trailer for peanuts. Now we are looking at relocating to an ESR destination in 3 years and I am starting to wonder if I want to buy a place there ahead of our target move date. Obviously it would cost more to maintain two homes (suppose we could rent the one in the future location, but it is 1800 miles away), but at some point the RE market will have bottomed and I can still get a 3.5% pen fed mortgage with no closing costs.

Thoughts? My initial reaction is that this would be too much hassle, but I would welcome any thoughts on the subject.

I tend to agree with you. Some of the reasons why I wouldn't choose to do this, follow.

We don't know if this is the bottom of the real estate crash, and you might regret it if prices drop further.

The stock market seems to be doing well lately, and you might miss out on part of the recovery if your money is tied up in real estate.

Also, we don't know what will happen in the next three years. Will you be able to sell your present home then, or will the real estate crash have evolved further into a near complete stoppage of transactions? Will you still want to move to the ESR destination? Will renters half destroy your new home, or will someone break in and turn it into a crack house? Will you end up in some kind of unexpected financial disaster that requires working longer than you expect? Although many people do buy their ER home in advance, I am reluctant to do so because there are just too many unknowns.

On the other hand, there are plenty of arguments on the other side. Buying low is a good thing, and real estate sure is low. It would be a step towards your ESR plans. It would give you a nice place to vacation. Decisions, decisions. To tell you the truth, I am uncertain about this as well, though so far I have not bought another home.

 

[Lagniappe]

Now we are looking at relocating to an ESR destination in 3 years and I am starting to wonder if I want to buy a place there ahead of our target move date. Obviously it would cost more to maintain two homes (suppose we could rent the one in the future location, but it is 1800 miles away), but at some point the RE market will have bottomed and I can still get a 3.5% pen fed mortgage with no closing costs.

Thoughts? My initial reaction is that this would be too much hassle, but I would welcome any thoughts on the subject.

I did this a few months ago - bought my ESR home in the location I want to live. The set up costs were high, but the carrying cost (with a sub-4% fixed rate mortgage) are not that high. I am spending more time than I expected in the new place, because I like it so much. For me it was probably not the best financial decision (will what I save due to buying at a depressed price and catching a low interest rate be offset by the additional monthly cost of a second mortgage, property taxes, condo fee, travel back and forth, etc?), but putting a major stake in the ground toward my ESR plan will keep me motivated for the next couple of years.

 

[FIREd]

Stateside, DW and I have decided to buy a RV instead of a second home. We are going to our first RV show in a couple of weeks to check out the latest offerings in person.

We have long entertained the idea of buying a vacation home in France. Fortunately for us, my family has enough real estate there that we can borrow for free. So we'll save our money.

 

[MichaelB]

We own a single house. I had a hankering for a getaway place for a long time and we scratched that itch in 2008 by buying a small travel trailer for peanuts. Now we are looking at relocating to an ESR destination in 3 years and I am starting to wonder if I want to buy a place there ahead of our target move date. Obviously it would cost more to maintain two homes (suppose we could rent the one in the future location, but it is 1800 miles away), but at some point the RE market will have bottomed and I can still get a 3.5% pen fed mortgage with no closing costs.

Thoughts? My initial reaction is that this would be too much hassle, but I would welcome any thoughts on the subject.

The cost of owning a second home can be calculated. What most people underestimate is the burden of owning. When you add another house you take on a new set of problems - insurance, maintenance, upkeep. Not something easy to manage for someone already juggling a half-dozen axes and chainsaws...

Future mortgage rates may increase, but housing prices are highly correlated to employment rates, and they don't look to change substantially - at least thru the 1st half of this decade. I suspect we're close to a bottom in nominal housing prices, but they can stay low for a long time.

 

[tryan]

Tryan- Do you mind sharing a bit more about your VRBO success? Where is the rental located? Cost/Size of house? Carrying a note?

Most of the VRBO owners I've heard of say that they are losing money every month!

We started with CyberRentals since they had the VT market locked up. They were acquired by Homeaway. Most of our bookings are now Homeaway ... but VRBO is a close second.

The house is ~2000 sq/ft ; no mortgage on it but did use 2 HELOC lines during construction. The vacation rentals carry the HELOCs, taxes, insurance, association dues, heat, electric, cable, internet, trash pick-up, plowing/lawn service, firewood, maids services (between tenants), and 9% VT Hotel tax.

Took about 4 years to get to the point where it breaks even (plus or minus a grand). First couple years were hard ... no repeat customer base. Now it drives itself.

Just need to know you're renting PEAK times (holidays and summer for us). We do block the kids vacation weeks and one summer week for ourselves (winter break and Christmas). For us ~80% of the rents are in 4 months. Rest of the year is hit-or-miss.

 

[jimnjana]

Thanks for sharing! When you say good luck, would you say that it is providing a better return than had you rented it at a prevailing market rate year round?

yes, about 50% more, net after tax return.