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It has panned out as I expected 20 years ago, both here in the Triangle and in Northern CA.
What's the definition of McMansion? I dunno, let's just say "more than you need", but at this point most anyone with common sense can spot them right away.
The friends of mine who bought McMansions 20 years ago have generally seen about 200% value increase since then regardless of whether in this area or out west.
The smaller homes I bought around the same time are enjoying 300% at the same time. At the end of the day interest rates and real-world market conditions narrow the pool of buyers, and in uncertain times, the maintenance prices of a huge home and the "McMansion Gouging" that comes with it more than offsets whatever advantages folks thought they were getting by trying to impress the joneses.
Now, as an investor, just the sheer liquidity of owning multiple smaller homes with a price point that is much more approachable, in itself is enough to separate the genius investor from the mentally disadvantaged ones.
I have several friends who invested in these things and their cash output due to "McMansion Gouging" by contractors has eaten them alive along the way.
Ah well.. gluttony always ends how it does, doesn't it? It seems the key to success is to keep your investments under the radar instead of flaunting them.
It is no crazy thought that smaller houses will appreciate more on a percentage basis than a large one. I mean that’s the biggest tip about buying new construction right, buy the smallest plan in the neighborhood.
This whole hating on “McMansions†thing has gotten so out of hand and is usually code for someone not liking the mere fact that someone bought a larger house than them, or sometimes just not liking the style.
Now, I’ll agree some people buy way more house than I would personally be comfortable with, but if they have the money then go for it.
It has panned out as I expected 20 years ago, both here in the Triangle and in Northern CA.
What's the definition of McMansion? I dunno, let's just say "more than you need", but at this point most anyone with common sense can spot them right away.
The friends of mine who bought McMansions 20 years ago have generally seen about 200% value increase since then regardless of whether in this area or out west.
The smaller homes I bought around the same time are enjoying 300% at the same time. At the end of the day interest rates and real-world market conditions narrow the pool of buyers, and in uncertain times, the maintenance prices of a huge home and the "McMansion Gouging" that comes with it more than offsets whatever advantages folks thought they were getting by trying to impress the joneses.
Now, as an investor, just the sheer liquidity of owning multiple smaller homes with a price point that is much more approachable, in itself is enough to separate the genius investor from the mentally disadvantaged ones.
I have several friends who invested in these things and their cash output due to "McMansion Gouging" by contractors has eaten them alive along the way.
Ah well.. gluttony always ends how it does, doesn't it? It seems the key to success is to keep your investments under the radar instead of flaunting them.
Our ~2300 SF love nest is "more than we need." "McMansion?" Whatever.
Tripled in value in 22 years.
The friends of mine who bought McMansions 20 years ago have generally seen about 200% value increase since then regardless of whether in this area or out west.
The smaller homes I bought around the same time are enjoying 300% at the same time.
A 300% gain over 20 years is just over 6% per annum. I think the Dow did about the same.
Quote:
Originally Posted by Owen Wister
Theres a difference between making an investment and buying a home.
A house to live in is not an investment.
If you are investing in real estate, you need to do your homework, regardless if it is a McMansion, condo, etc, etc.
A 300% gain over 20 years is just over 6% per annum. I think the Dow did about the same.
A house to live in is not an investment.
If you are investing in real estate, you need to do your homework, regardless if it is a McMansion, condo, etc, etc.
Well...
I don't look at a home as a consumable, either.
Why do we consider resale value, if it is not an investment? If we can calculate a positive OR negative return as we can with any other investment, I would contend a house would qualify as an "investment."
I can calculate a return if/when we sell our house, allowing for costs of transactions in and out, allowing for applicable costs of ownership: maintenance, upgrades, expansions, taxes, HOA dues, repairs, etc.
I could agree with:
"A house to live in is not always a wise or highly profitable investment."
A house to live in is not an investment.If you are investing in real estate, you need to do your homework, regardless if it is a McMansion, condo, etc, etc.
Yes, thats correct.
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