If you had $4M, would you spend $2M of it building a house?

And throwing out a number just to throw one out is a bit lame..... there are comps that you can look at...

So... IF you really think that it would sell for $3 million the day after it is completed then IMO it is a no brainer...
You have completely changed the question, or at least that not how I took it. I could see myself having to sell the house 20 years from now if my wife died and I had to go to some sort of assisted living. 50% appreciation in 20 years seems reasonable. No reason to call me lame for making an educated guess on that.

IF, however, your scenario is that after working and saving for 30 years to build this very specific custom house, living in a cramped 750 sqft single wide trailer for 4 years waiting to complete it, then on the very day it was completed I decided that $2.5M in remaining investments was not enough, and decided that SS wouldn't pay the small bills that we might have (no water, no sewer, no utilities, not much of a food bill, zero travel, etc) and just had to sell it for some reason, I'm guessing there is a chance that we could lose some money. Good point to ponder...
 
Since OP has indicated he is willing to spend the money for his dream home, I think the only questions is whether he can "survive" on the remainder. That takes some calculations - the first one being normal spend level - post dream home build.

Once established, the spend level can be compared to the "stash" remaining and determine whether it's within our not-totally-arbitrary "4% rule" for withdrawal rate. If OP can withdraw 4% or less to meet his ongoing needs (coordinated with future SS or other income) then he should be good to go.

There is nothing intrinsically wrong with having 50% of total NW tied up in a house - as long as the investments remaining are enough to meet on-going needs.

Best luck to OP in this decision and the build and a long and happy life on the "Bunny Ranch" or whatever name w*rks best.

Cheers and aloha.
 
Three months before I FIRED one of the guys who worked for me was filling in his pool so he could sell his house. He believed it was dragging the value down. DW has always wanted a boat and I told her that I would just pay someone $1500 a day to rent theirs. She's never taken me up on that. Point being, I'm pretty sure what is going to happen is she will use the pool 10 times in the first month and then never use it again. Still, this will be our last home so the worst that happens is we will have a nice place to skateboard!
If this is to be a joint project, a dream home for both, I’d suggest making the pool more usable year round by keeping it heated.
 
Kudos to OP for planning for a ground (instead of roof) mounted solar system.
Ironically, I am actually waiting for a contractor to drop in a couple of hours to give me an estimate on 30 panels roof mounted on one of my workshops. I figure if it leaks, so be it. But you are correct, no way in hell I would do this on my house. I'm kind of struggling now with paying the extra money for (whatever the no seam metal roof is called) vs just regular shingles on our house. My contractor said it would be 3X the cost and that kind of jedi mind tricked me into thinking shingles would be fine. It is hard not to lose focus on what one of the goals is. A house I can live in for 30 years with minimal maintenance.

FWIW, one of the other goals with the custom build would be evident if I told you that our power went out last night (thankfully just a blip) AND we don't have any water pressure right now. Usually it is only around 30-35 PSI (two full minutes to fill a 5 gallon bucket). Solar powered deep well will take care of both of those issues. I'm not actually a crazy prepper but I can see their point.
 
Standing seam metal roof is what you're thinking about and that's the one that you can clip to with the S5! Clips.
That's what I'm doing, but I have experience of installing six of those roofs myself. It's apples and oranges.
I also made a really simple roof with rectangular sections and no valleys because I hated them when I was doing the roofs!
 
Best luck to OP in this decision and the build and a long and happy life on the "Bunny Ranch" or whatever name w*rks best.
Thanks! We officially call it the Lazy-B Ranch now. (Because Bob and Bunny are living the dream and not busting our @ss).
 

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If this is to be a joint project, a dream home for both, I’d suggest making the pool more usable year round by keeping it heated.
Thanks! Yes, plans are for solar heat as well as solar powered electricity for heat (it will be a "salt" pool). I've never owned a pool so I understand I definitely don't have a clue what is in store for us.
 
Solar has come down so much. Heating a pool is a fantastic way to utilize it. Slow and steady rather than instant demands like light switches and appliances.
 
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Ironically, I am actually waiting for a contractor to drop in a couple of hours to give me an estimate on 30 panels roof mounted on one of my workshops. I figure if it leaks, so be it. But you are correct, no way in hell I would do this on my house. I'm kind of struggling now with paying the extra money for (whatever the no seam metal roof is called) vs just regular shingles on our house. My contractor said it would be 3X the cost and that kind of jedi mind tricked me into thinking shingles would be fine. It is hard not to lose focus on what one of the goals is. A house I can live in for 30 years with minimal maintenance.

FWIW, one of the other goals with the custom build would be evident if I told you that our power went out last night (thankfully just a blip) AND we don't have any water pressure right now. Usually it is only around 30-35 PSI (two full minutes to fill a 5 gallon bucket). Solar powered deep well will take care of both of those issues. I'm not actually a crazy prepper but I can see their point.

Yep, standing seam metal roof...no exposed fasteners.

I'd pay for it since you're bundling the cost into the total cost of new construction.

And it would likely outlive you...probably not the case with asphalt shingles.
 
Heck no. I'd live in a van, down by the river, before blowing half my nest egg on a house.
 
Thus towards the second portion of your post, which I quoted above, I'm actually surprised not to have seen in this thread any particular success stories, where so-and-so stretched to afford a costly house, taking the hit in stock market opportunity cost, but now, 5-10 years later, coming out very much ahead, due to housing price appreciation.

Perhaps the issue was the way the thread title (and in the initial post) was worded.. instead of "If you had 4M, would you spend $2M building a house?" - which will result in yes/no speculative answers - a better wording might be "has anyone spent half of their liquid net worth assets (stocks/bonds/cash) on building a house, and what were the results?"
 
Thanks! Yes, plans are for solar heat as well as solar powered electricity for heat (it will be a "salt" pool). I've never owned a pool so I understand I definitely don't have a clue what is in store for us.
I'd design it with a built-in pool cover if you are trying to keep it open most of the year. And no lugging a heavy cover around by yourself when you get older. Save chemicals, save your back, keep leaves out, save heat and keep kids and animals safe.

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I'd design it with a built-in pool cover if you are trying to keep it open most of the year. And no lugging a heavy cover around by yourself when you get older. Save chemicals, save your back, keep leaves out, save heat and keep kids and animals safe.
It will reside in a screened in room (not sure what that is called - a bunch of them in FL) so no leaves or stuff.
 
Never buy or build a house above the 75% (median + 25%) of home prices. $2M in some places in California is median so there a $2M home makes sense. If the median were $1M you would have problems selling a $2M home.
Is this a universal truth? It makes sense for somebody who may need to sell if they get a job transfer. I'm not sure that it is equally applicable to a couple who have very specific requirements and plan to live in the house more or less forever.
 
Is this a universal truth? It makes sense for somebody who may need to sell if they get a job transfer. I'm not sure that it is equally applicable to a couple who have very specific requirements and plan to live in the house more or less forever.
Not a "universal" truth, of course. But we have to ask ourselves honestly, how we approach money, consumption, investment and chasing of net-worth. If money is merely a means to an end, then yes, once we're decisively done working, and have no cause to move (except perhaps to the nursing home, or the cemetery), then how this-or-that expense affects our finances, is unimportant. Rules of thumb can be dismissed. But if the pecuniary treadmill never stops - whether because that's our mindset, or our actual situation - then we have to remain ever-vigilant, about prices and markets.

The only "universal truth", is that we must all contend with our personal psychology.
 
...and just had to sell it for some reason, I'm guessing there is a chance that we could lose some money. Good point to ponder...

I said earlier that it sounds like this is your dream house and nothing wrong with following your dreams, if you can afford it which it sounds like you can.

But your dream is not necessarily someone else's dream. Your plans show a 2700 sq ft house (60x45ft) with 2 bedrooms. In rural middle TN, 2 bedroom homes are not million dollar homes, much less 2 million. I'd say it is almost a guarantee that you would lose money, and substantial money, if you sold soon after completing the build.

I'm not trying to discourage you, just a reality check.

Below is a link to home for sale a little south of Crossville. Built in 1989 so it is older, but it is 5500 sq ft, 5 bedrooms, 34 acres, pool, barn, creek, pond. Asking $1.4 mil and been on the market over 100 days.

People spend a lot of money on things like travel. Those are experiences and obviously not investments. Once money is spent on an experience, it is gone. And there is nothing wrong with that - doesn't mean the expense wasn't worth it.

You are basically spending money on a home experience. The home you are building in the location you are building it, well, it is a lot like travel. Some of the money you spend is just going to be gone (in my opinion). But it sounds like you and your wife will enjoy the experience of building and living there, so the expense may be well worth it to you. Just go into it with your eyes wide open about this not being an investment.

 
Thanks! Yes, plans are for solar heat as well as solar powered electricity for heat (it will be a "salt" pool). I've never owned a pool so I understand I definitely don't have a clue what is in store for us.
I'd recommend a regular electric pool heater, which you power via your overall solar. Don't get a stand-alone solar pool heater. I looked at the options just a couple of years ago.

A) they will take up a lot more square footage in the system (about the same area as your pool). Roofing guys HATE them.

B) you will see, at best, a 5-10 degree warm up, which of course can't be sustained outside of the sunny daytime, and I'd expect on the low side of that. Sounds good until it's a nice spring day and your pool is still 65 degrees. Woo-hoo solar's gonna get it to maybe 72 by 4 in the afternoon, and it will drop back to 68 or less overnight. A heater powered by electric can run whenever you want, whenever your pool pump is on, usually a bit more than a degree per hour.

Gas pool heaters are the most efficient on, say, you want to get it to 90 that afternoon when it's only 70? Sure, but they are far more expensive to run.

If you live in an area that routinely sees 95+ temps for a few weeks, consider a chiller as well. I don't have one, and when the pool is 93 for a few weeks in July I do think it might have been a good idea, but I live in S. Fla.

Salt is easy to maintain, you'll just be hauling 40lb bags of salt back from Home Depot, along with baking soda, acid, and stabilizer.
 
But your dream is not necessarily someone else's dream. Your plans show a 2700 sq ft house (60x45ft) with 2 bedrooms. In rural middle TN, 2 bedroom homes are not million dollar homes, much less 2 million.

I don't know about TN, but 2 bedrooms in a house that size may give you a marketability problem if you go to sell. People will probably want 3-5 bedrooms, typically. Plus same number of baths plus 1/2. If you will stay "forever" maybe it does not matter. But something to think about.
 
I don't know about TN, but 2 bedrooms in a house that size may give you a marketability problem if you go to sell. People will probably want 3-5 bedrooms, typically. Plus same number of baths plus 1/2. If you will stay "forever" maybe it does not matter. But something to think about.
For us, that is the ideal size, 2700 sq ft with 2Bd, 2.5Ba. We are at about 3000 sq ft, with 1 casita with 1BR/1Ba, and the main house is 2Bd, 2.5Ba, all ensuite, and it's perfect for a retired couple. Once in a while we have guest(s) and they will stay in the spare bedroom in the house and we never use the casita. Any extra bedroom(s) take away from living spaces.

The question in hand is whether OP should spend that much on the house, which he has since reduced the estimate to $1.4M, which is not unreasonable for a custom build home. As long as $2.5M/$2.6M can support their expenses, there is really no issue.
 
For us, that is the ideal size, 2700 sq ft with 2Bd, 2.5Ba.
Our house will be 2700 with 2Bd, 2Ba. This does not include the attached workshop with a full bath or the climate controlled garage. It sounds like we are exactly your idea size. My estimate is indeed $1.4M but it will go over I am sure and be closer to $2M. Better to plan for that instead of underestimating.

FWIW, I will die in this house. It is not for a monetary investment. I have no plans to ever sell it. No other houses in the area even interest me nor my wife in the least. This is OUR house and suits OUR needs. It can only be custom built.
 
Definitely not, not only because $2,000,000 is half your portfolio, you have the carrying costs of a $2,000,000 house on your remaining $2,000,000 portfolio for eternity.
 
Our house will be 2700 with 2Bd, 2Ba. This does not include the attached workshop with a full bath or the climate controlled garage. It sounds like we are exactly your idea size. My estimate is indeed $1.4M but it will go over I am sure and be closer to $2M. Better to plan for that instead of underestimating.

FWIW, I will die in this house. It is not for a monetary investment. I have no plans to ever sell it. No other houses in the area even interest me nor my wife in the least. This is OUR house and suits OUR needs. It can only be custom built.

I think you should start a build thread and give us pics as you go along. Your house, your needs, your money. You do you. I hope it goes even better than expected. (y)
 
Below is a link to home for sale a little south of Crossville. Built in 1989 so it is older, but it is 5500 sq ft, 5 bedrooms, 34 acres, pool, barn, creek, pond. Asking $1.4 mil and been on the market over 100 days.
Actually, the home was listed for 1.45 mil on 04/20/22 and has had the listing removed and put back on several times. Looks like a beautiful place to me.

I would not spend half of my net worth on a house either. I like smaller rather than bigger.

My question is whether your wife would want to live there and take care of the place if something were to happen to you. I definitely would not want to be by myself in a remote location. She might love it.

Good luck making your decisions. We are all different and want different things in life.
 
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