Thoughts on moving to 55plus community
We live in a great location near Microsoft in Redmond WA on the hill. We have a 7 acre property with barn, apartment, and 4K sqft log home. Its been nice for 17 years now, and we have been retired since 2007 (wife) and 2016 (me). We are trying to weigh in whether to move or should we stay put.
Our home is ideal for a family with 3 young kids, like my DD1. Costco a few minutes down the hill, Redmond very close, Sammamish, and stores just minutes by EV. Our use of the space is so limited it seems like a waste to stay when our grands could have such a better home and school system.
I like our home a lot, but with stairways on each end of the home it will only get more difficult. Our DD1 lives south 40 minutes, in a less desirable location. DD2 lives north 40 minutes in an investment home (located on the light rail into Seattle and zoned for multifamily, a future build out). We would all like to be closer together.
For some this may be a shock, but for only $1.7M we can buy a smaller home in a 1500 home 55+ community 2 miles from our current property. Nice home, not quite what I have built in the past, but it has all the lifestyle stuff, with club house etc. We could buy this cash and still own our estate property, keeping our resident horse and keeper/grounds keeper/semi-adopted son in his apartment. At first this seemed perfect.....
When this thought leaked to DD2, it was a big deal, but she did not consider we would make it right to her. DD1 is all for this idea, as we could live close together, see the grands much easier and they could have an ideal school system (schools are next to Space X and Startlink offices) between the two homes. The area is predominantly tech boys and old pharts.
After reading the recent thread on Balancing an advance on kids' inheritance by BigNick, there are many issues to consider. However, so far we have "given" each DD a house, one a large down payment and a lot of sweat and cost to renovate, the other we gave a similar down payment and then "loaned" her the rest, with a reconveyance on death clause.
Questions for the group;
1. Is it in our best interest to move at this point for the benefit of the young grands. It would wipe out our after tax savings, but give us a nice 3 bedroom rambler in a community of older adults. We have plenty in our retirement accounts and pensions as well as rental incomes. I forgot to mention, our neighbor hood consists of one house below us, the rest is our woodland and a park next to us. All of our friends require a drive some few miles. We miss our old neighbors from 17 yrs ago. The proximity to the grands would be great, but would I be cussing every time I go back to my shop to find my tools missing or ###$@$#? Just an example...could this work in practice to have them live there if they do not maintain it like I would?
2. How do I make this fair to DD2? Do I accrue a use debit monthly for them staying in our house which would by some cash flow formula be a Future Value reducing DD1 share of the estate? Maybe use 6% discounted cash flow to achieve a future value based on a $6K/mo FMV rent?
3. We live in WA state, so its complicated. We get double step up basis and the QTIP trust structure preserves our state death tax exemptions, so keeping stuff in the trust is good, but not essential. We could just sell our 7 acres for development by Toll Bros etc, or develop our own subdivision. Should we instead short plat and build out 3 more homes? I am currently kicking out one renter on a property zoned downtown commercial and will sell it in the next few months to help cover some construction. So this is swing option to stay and build out instead of moving to the 55+. We could simply sell our property and forget about all the benefit for the grands, but that seems like a waste.
4. Lastly, I fear I may regret moving from this home to a smaller lot. I spent the day spreading Rid Moss on over an acre of nice lawns, and raking out weeds in my vegie garden, which would not be an option in the restrictive 55+ home. The front grounds are maintained by the association. I gave carrots to the horse 3 times, and maintained my diesel Kubota tractor today. If I moved, I would have to install an enclosed outdoor urinal, as the neighbors may not be so agreeable to my urgencies....20 feet from their decks....and there would not be so much to do or maintain. I guess I can always still pick my Chantarelle's and Morrells with a 2 mile drive back?
Anyone else made this type of decision? Is the social aspect of the 55+ living worth the loss of space, privacy and freedom to do what you want on your own property? $300/month HOA seems crazy to me, but the mandatory buy in of 0.5% of sale price seems high as well. Is this typical?
We live in a great location near Microsoft in Redmond WA on the hill. We have a 7 acre property with barn, apartment, and 4K sqft log home. Its been nice for 17 years now, and we have been retired since 2007 (wife) and 2016 (me). We are trying to weigh in whether to move or should we stay put.
Our home is ideal for a family with 3 young kids, like my DD1. Costco a few minutes down the hill, Redmond very close, Sammamish, and stores just minutes by EV. Our use of the space is so limited it seems like a waste to stay when our grands could have such a better home and school system.
I like our home a lot, but with stairways on each end of the home it will only get more difficult. Our DD1 lives south 40 minutes, in a less desirable location. DD2 lives north 40 minutes in an investment home (located on the light rail into Seattle and zoned for multifamily, a future build out). We would all like to be closer together.
For some this may be a shock, but for only $1.7M we can buy a smaller home in a 1500 home 55+ community 2 miles from our current property. Nice home, not quite what I have built in the past, but it has all the lifestyle stuff, with club house etc. We could buy this cash and still own our estate property, keeping our resident horse and keeper/grounds keeper/semi-adopted son in his apartment. At first this seemed perfect.....
When this thought leaked to DD2, it was a big deal, but she did not consider we would make it right to her. DD1 is all for this idea, as we could live close together, see the grands much easier and they could have an ideal school system (schools are next to Space X and Startlink offices) between the two homes. The area is predominantly tech boys and old pharts.
After reading the recent thread on Balancing an advance on kids' inheritance by BigNick, there are many issues to consider. However, so far we have "given" each DD a house, one a large down payment and a lot of sweat and cost to renovate, the other we gave a similar down payment and then "loaned" her the rest, with a reconveyance on death clause.
Questions for the group;
1. Is it in our best interest to move at this point for the benefit of the young grands. It would wipe out our after tax savings, but give us a nice 3 bedroom rambler in a community of older adults. We have plenty in our retirement accounts and pensions as well as rental incomes. I forgot to mention, our neighbor hood consists of one house below us, the rest is our woodland and a park next to us. All of our friends require a drive some few miles. We miss our old neighbors from 17 yrs ago. The proximity to the grands would be great, but would I be cussing every time I go back to my shop to find my tools missing or ###$@$#? Just an example...could this work in practice to have them live there if they do not maintain it like I would?
2. How do I make this fair to DD2? Do I accrue a use debit monthly for them staying in our house which would by some cash flow formula be a Future Value reducing DD1 share of the estate? Maybe use 6% discounted cash flow to achieve a future value based on a $6K/mo FMV rent?
3. We live in WA state, so its complicated. We get double step up basis and the QTIP trust structure preserves our state death tax exemptions, so keeping stuff in the trust is good, but not essential. We could just sell our 7 acres for development by Toll Bros etc, or develop our own subdivision. Should we instead short plat and build out 3 more homes? I am currently kicking out one renter on a property zoned downtown commercial and will sell it in the next few months to help cover some construction. So this is swing option to stay and build out instead of moving to the 55+. We could simply sell our property and forget about all the benefit for the grands, but that seems like a waste.
4. Lastly, I fear I may regret moving from this home to a smaller lot. I spent the day spreading Rid Moss on over an acre of nice lawns, and raking out weeds in my vegie garden, which would not be an option in the restrictive 55+ home. The front grounds are maintained by the association. I gave carrots to the horse 3 times, and maintained my diesel Kubota tractor today. If I moved, I would have to install an enclosed outdoor urinal, as the neighbors may not be so agreeable to my urgencies....20 feet from their decks....and there would not be so much to do or maintain. I guess I can always still pick my Chantarelle's and Morrells with a 2 mile drive back?
Anyone else made this type of decision? Is the social aspect of the 55+ living worth the loss of space, privacy and freedom to do what you want on your own property? $300/month HOA seems crazy to me, but the mandatory buy in of 0.5% of sale price seems high as well. Is this typical?
