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

[NW-Bound]

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]

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]

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]

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]

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.

 

[cyber888]

Will you retire in this $14 Million castle in the middle of nowwhere Looks like the Castle of the Knights Templar

https://www.zillow.com/homedetails/212-White-Pine-Canyon-Rd-Park-City-UT-84060/89088962_zpid/

probably refer this to the Castle lol

https://www.zillow.com/homedetails/7002-Lupine-Dr-Park-City-UT-84098/68854094_zpid/

 

[MarieIG]

Will you retire in this $14 Million castle in the middle of nowwhere

https://www.zillow.com/homedetails/212-White-Pine-Canyon-Rd-Park-City-UT-84060/89088962_zpid/

Only four bedrooms . . .

 

[PandaBear]

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.

I was just sick when we spent 300K on a house in the Bay Area 25 years go. I couldn’t imagine anything that cost that much would ever appreciate and I was terrified we’d be bankrupt in a few years.

Today we live in a paid off 1.4 million dollar house. Believe me, it doesn’t feel like a million dollar house!

 

[YVRRocketSurgery]

We bought our fairly basic single detached in the late 90's and its valuation has more than tripled, putting it into the mil+ category. Kind of indicative of the crazy Vancouver market over the last two decades.
I'd love to buy a nicer place that would be better suited for entertaining friends and family but we have to do a bit of a trade off to allow us to retire early and have some dollars for some fun.

 

[24601NoMore]

+1 All I want is a "nicer" 2500 sqft home.

Same here. Been looking for several years and can't find it. There are either ridiculously large (4K+ sq ft) houses with nice finishes for a lot of $$ or smaller houses without nice finishes.

We'd also like to find something near a bike trail that's on a private piece of property with no visible (or more importantly) audible neighbors.

We've come to call that "looking for the purple unicorn" because we're pretty sure it doesn't exist - at least in our area.

We looked to build about a year and a half ago, and new construction all-in was minimum $250/sq ft and potentially $300+/sq foot (including land, septic, etc). That'd put our 2,500 sq ft retirement home with nice finishes on a private piece of land into the $750K+ range..no thanks! So, the search continues and we're for now somewhat stuck in a much larger and more expensive to run/maintain house than we 'need' at this point in our lives..

 

[Koolau]

We had friends in Honolulu who decided to sell out and move to (IIRC) Hilton Head when they retired. I don't know how much their house was worth, but across the street, a "tear down" was going for $1.2 mil. We know several retirees whose homes are worth at least $1 mil. Most retired after owning the same home for many years. Our "home" is only worth about $0.6 mil. We don't feel particularly rich or poor for that matter. Pretty much average. Back on the mainland we had a house with 3 times the SF for 1/4 the price. Once again, location, location, location. YMMV

 

[ElizabethT]

We purchased a $1,000,000+ home recently in coastal S. California, some six years into ER, after much careful thought. Our goal in moving was to get closer to the ocean, and that is what it costs to do so here. We live in a lovely home, but it's not fancy in any way, and it's a pretty reasonable 2500 sq. ft.

The bottom line is we could, and can, afford it. And a million dollar home is not really that big a deal anymore here. Two million and up is pretty ritzy, but not so much a million to $1.75 mill. A million does seem to assure well kept up homes/neighborhoods, however, which we do very much appreciate.

Keep in mind that salaries here can be very high, particularly when bonuses, stock options, etc. are added in. A couple of decades of heavy duty LBYM between my husband and me, and here we are.

 

[eroscott]

Aside:

DW and I have been searching for that “perfect” house for several years now with no luck. Certainly not anywhere near $1M but almost halfway there is our budget. Our problem is that we want a nice house with nice finishes, but not 4000 sf. Seems we can find one but not the other.

Ditto for us ...
Found some cool sites that let you look at house plans by numerous criteria, let you do some customizing, and let you get a 'build-cost' report. HomePlans.COM
-- BuilderHousePlans.COM
-- DreamHomeSource.COM
-- FloorPlans.COM
-- EPlans.COM
-- FrankBetzHousePlans.COM

 

[ivinsfan]

We purchased a $1,000,000+ home recently in coastal S. California, some six years into ER, after much careful thought. Our goal in moving was to get closer to the ocean, and that is what it costs to do so here. We live in a lovely home, but it's not fancy in any way, and it's a pretty reasonable 2500 sq. ft.

The bottom line is we could, and can, afford it. And a million dollar home is not really that big a deal anymore here. Two million and up is pretty ritzy, but not so much a million to $1.75 mill. A million does seem to assure well kept up homes/neighborhoods, however, which we do very much appreciate.

Keep in mind that salaries here can be very high, particularly when bonuses, stock options, etc. are added in. A couple of decades of heavy duty LBYM between my husband and me, and here we are.

Yes but everyone can't have the job with bonuses and stock options. One wonders what people like school teachers and service providers are supposed to do for a place to live in these HCOL areas. Buying a million dollar home would be a big deal to lot of working people. As older retirees move cash out their homes and relocate a lot of neighbor diversity will vanish. This comment isn't aimed at you, in fact we have a similar process going on in our area. It's the reverse problem our small rural towns without many jobs are turning into towns full of seniors and no young people. As the local car dealers, feed mills, elevators, hardware stores and such close there are no jobs and no services so the town just starts shrinking. Houses cost almost nothing or maybe the price of a nicer new car, but no one wants them.

 

[kgtest]

I'll never forget when I was renting next to a Fruit Farm estate on the side of Haleakala Maui (Makai ) we had an ocean view. I paid $2400/mo for 1200sq ft upper duplex with 3br 2ba this was 5 years ago. Property was listed on Zillow at 1MM +

I'll never forget the people who bought the 4MM home up the volcano the next drive up.

They were 38 with some kiddos.

I did a quick peak, looks like they are selling for 4MM about what they bought for. Funny zillow has these 4 properties combined at 22MM !!

https://tinyurl.com/yyk2o5zj


A 22MM home was literally in my back yard. https://www.zillow.com/homedetails/120-Kaimanu-Pl-Kihei-HI-96753/2086508547_zpid/?mmlb=g,3

 

[tb001]

Yes but everyone can't have the job with bonuses and stock options. One wonders what people like school teachers and service providers are supposed to do for a place to live in these HCOL areas. Buying a million dollar home would be a big deal to lot of working people. As older retirees move cash out their homes and relocate a lot of neighbor diversity will vanish. This comment isn't aimed at you, in fact we have a similar process going on in our area. It's the reverse problem our small rural towns without many jobs are turning into towns full of seniors and no young people. As the local car dealers, feed mills, elevators, hardware stores and such close there are no jobs and no services so the town just starts shrinking. Houses cost almost nothing or maybe the price of a nicer new car, but no one wants them.

I wonder if things will start going the other way, as more of the workforce has options like telecommuting available to them.

 

[ShokWaveRider]

If we thought we could find a decent home ~2500 sqft in Hawaii for under $1m, we would probably consider moving there. The higher cost of living does not bother us as much as the outlay for the home in the first place.

 

[kgtest]

If we thought we could find a decent home ~2500 sqft in Hawaii for under $1m, we would probably consider moving there. The higher cost of living does not bother us as much as the outlay for the home in the first place.

There are some cute 'ohanas' up in Pukalani thst might fit that bill.

Housing is...interesting on Maui lol

 

[CaliKid]

We recently have been debating this. Looking at a new city to move to. We own a rental there in a Sun City neighborhood. It's a nice 3/2 but small (under 1,500 sq). It's worth $250k. It is completely livable without question. However, once we got there we realized we might like a bigger house, maybe on a golf course, ok maybe a country club, blah, blah, blah.... and before you knew it we were looking at $1m - $1.5m homes in the 3,500 - 5,000 sq range. We can afford it but it would reduce our travel budget. For us it's just a matter of which we want more. We don't really "want" a huge home but once you start looking at them it is easy to get sucked into some daydreams about owning such a "show" house and the grandkids swimming in the big pool and all that. Luckily cooler heads prevailed and we have not bought anything yet and are now looking in the 2,500 sq range in "lesser" neighborhoods that are only single gated rather than some of the fancier "double gated" hoods. Hopefully we will get it down to $700k or so for a very nice, move-in ready, home. We shall see. The struggle is real. Lol.

 

[ElizabethT]

Yes but everyone can't have the job with bonuses and stock options. One wonders what people like school teachers and service providers are supposed to do for a place to live in these HCOL areas. Buying a million dollar home would be a big deal to lot of working people. As older retirees move cash out their homes and relocate a lot of neighbor diversity will vanish. This comment isn't aimed at you, in fact we have a similar process going on in our area. It's the reverse problem our small rural towns without many jobs are turning into towns full of seniors and no young people. As the local car dealers, feed mills, elevators, hardware stores and such close there are no jobs and no services so the town just starts shrinking. Houses cost almost nothing or maybe the price of a nicer new car, but no one wants them.

I think that's a different slant from what the OP was asking, which was about retiring in a $1 million+ home.

What you are describing, however, is a scenario I really can't imagine occurring here. We have a robust economy, with a particularly thriving tech sector. Most everyone I meet here along the coast plans to stay here in retirement. Once you've tasted the coastal lifestyle, including the amazing year round weather, it's very difficult to leave. We do have an ongoing influx of new retirees, and they somehow find a way to make it work.

Move just 10 miles or so inland, however, and prices drop. This is where you'll find many of our teachers/police/fire personnel/mid-management, etc., often in very pleasant, kid-friendly, master planned communities. Heck, it's where we started! And where our adult children did as well. It's simply the normal trajectory for a HCOL area, has been for many, many years, and likely will be for many to come.