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Old 01-25-2018, 05:50 PM
 
6,803 posts, read 3,862,667 times
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Quote:
Originally Posted by rjm1cc View Post
It is not an investment. If you like it buy it and use it.

Except that for most Americans, their home IS their largest investment! Great if is isn't though.
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Old 01-25-2018, 07:43 PM
 
Location: Eastern Washington
14,242 posts, read 44,903,829 times
Reputation: 12823
Quote:
Originally Posted by GeoffD View Post
For a retirement home, I'd be more interested in property taxes and a risk that they could spike than in potential appreciation. I'd hate to buy my retirement home and have it triple in value over a decade with the same tripling of property taxes. I might not be able to afford to live there.

I view my retirement house as my long term care policy. I've tried to pick a housing style (no stairs) and location (very close to services) to avoid the need for assisted living. Until I'm not safe in the house by myself, I should be OK with the town elderly affairs & community nursing building a mile away, paid help for cooking, cleaning, laundry, errands, and taxis/Uber to get me to anything that doesn't deliver to my door. I'm hoping self-driving cars will be useful, too.

I spent as much remodeling my house as I paid for it in 2009. I'd have to see crazed amounts of appreciation to ever get that money back. I view a house as discretionary spending to improve my quality of life, not as an investment. If I wanted to create the largest possible pile of money, I'd live in a tiny studio apartment in a bad neighborhood and invest the money in the market.
I think there is a lot to be said for this approach.

The idea that appreciation might drive up property taxes needs to be considered as well. Only in Cali are you "proof" against that (unless that proposition, what is it, prop 13? is repealed)

I think I am living in my retirement home now, although, unpredictable circumstances may force a move. Bought back in '91 for about $61K, it's now worth at least $250K, most of that is simple appreciation, and a shift in the market that favors a smaller home out in the country with plenty of land for horses, to sell to "empty nesters" and/or singles, DINKs, whatever, people who are not concerned with the school district. That said I have built one garage, heavily remodeled a barn/garage that was here when I bought, and built several sheds, wired all these outbuildings for power, some other stuff. But the house itself, and the land, are largely as they were when I bought it.

So in my case, the one house I have bought with the least thought about appreciation, is the house that has appreciated the most. Well, most other houses I only kept them 3-5 years before a job change forced me to sell, so I didn't really have much time for them to appreciate much beyond enough to pay the realtor's commission.
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Old 01-25-2018, 09:49 PM
 
Location: Scottsdale, AZ
7,654 posts, read 4,699,473 times
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Quote:
Originally Posted by yellowsnow View Post
Seriously....just the utility bills would be way over my head. And I don't want 7K sf of house cleaning plus the yard and the pool. Yikes! But to each his own!
I guess the joke is on me because I found out today that home is under contract.

Quote:
I don't think you will ever find a house that will appreciate like they do in California. But homes in Arizona are not losers. High demand because people want to retire/live there. They will still appreciate.
We made an offer today. First time we'd seen the house and we knew it was perfect for us.
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Old 01-25-2018, 10:03 PM
 
Location: Silicon Valley
18,094 posts, read 22,952,534 times
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Even if a house doesn't appreciate, when you own it you - usually - lock in your monthly payments, so you don't have to worry about your housing costs going up, such as when you rent. You also used to get to write off interest and taxes, etc., although I think the new tax laws took those away. And of course, if you are still in it after it's paid off, then no mortgage payments eventually.

I think the unknown of future taxes is scary. Prop 13 was voted on because at the time, people were being taxed out of their homes. The home they bought when they were young for say $16,000 on the GI bill (like my father), expecting to live in it after it was paid off in their retirement, would sometimes end up with a home that was assessed for hundreds of thousands of dollars, and they couldn't afford to pay the taxes. People were losing their homes because of this, or being forced to sell them and move somewhere else.

And of course, you would also have the costs associated with upkeep.

But, another upside is that you have control over the place, too. You can paint your walls, get a bunch of dogs, whatever.

I hope you enjoy your new place. I don't know about AZ's property tax laws. Hope you don't have to worry about taxes going crazy down the road.
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Old 01-25-2018, 11:45 PM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
22,563 posts, read 39,944,045 times
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I view a house as discretionary spending to improve my quality of life, not as an investment.

Quote:
Originally Posted by M3 Mitch View Post
I think there is a lot to be said for this approach. ^^^

The idea that appreciation might drive up property taxes needs to be considered as well. ...

So in my case, the one house I have bought with the least thought about appreciation, is the house that has appreciated the most. ...
me too (or 3rd or 4th...in this thread)

Personal residence = a Liability, not an asset (Your view may vary)

Since I became a 'caregiver' for a disabled parent at age 18 I have keep multiple living spaces in each residence / location. (if it is not legal / possible to add a residence to the main home, I buy neighbor houses when they become available (have done that in EVERY home)_ +/-... I have 3 neighbors with adult children or grand children living in their extra guest homes... (So.. this plan could backfire) or... it may be needed (for self or caregiver). Works great in rural settings, as there is someone around to watch the place when we travel, & mow, collect mail, pay bills, (taxes) and feed the cats / dogs & livestock. (And blade snow when required).
For AZ... they could clean the POOL!

A farmer friend bought the neighbor house and rented it to an Asian refugee family learning Englisgh and getting Documentation to become US citizens. He then subleased his farm to them (Share cropped with them when he retired). It was a very ideal situation, as they diligently cared for his farm (he made the same income as previous, as they were very productive), then they cared for his wife, then him! (Aging in place)



A realtor friend bought 9 homes in Scottsdale area (during 2008 'price adjustment') I seem to have lost track of him after that! He must have stayed! I would expect he did well on appreciation. (or rental income).

Seems a LOT more seniors are renting, I am 'banking' on that, as I prefer renting to singles and couples.

I consider a late term retirement residence structure (SFH) to potentially be a Royal PITA...
  1. il-liquid
  2. Maint
  3. Lonely
  4. Costly
  5. Inefficient

Last edited by StealthRabbit; 01-25-2018 at 11:55 PM..
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Old 01-26-2018, 06:06 AM
 
Location: Forests of Maine
30,682 posts, read 49,443,611 times
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Quote:
Originally Posted by Harpaint View Post
Except that for most Americans, their home IS their largest investment! Great if is isn't though.
For most Americans their home is their largest asset.

But is it really an 'investment'?

For our first four homes interest rates were high. Let me give you an example. On a $100k Single-Family-Residence, if I made the mortgage payments for 30-years I would have paid a total sum of $300k. That $100k house would have cost me $300k. And if I had sold it for $120k, the IRS would have taxed me on the 'increase between $100k and $120k, ie $20k. While it would have still cost me $300k to buy.

If that honestly an 'investment'?

To me, an investment is something that I put money into where I plan to make money.

Our first four homes were all Multi-Family-Residences. We lived in each of them, while we also had tenants paying us rent. I paid the closing costs, and the rental income carried the mortgage, insurance, taxes, upkeep, and separate principal-only payments. On a $100k Tri-plex I paid $8k in closing. Each of our MFRs had the clear potential to pay us back more than how much we had paid to buy them. In my mind I considered those to be investments.
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Old 01-26-2018, 06:26 AM
 
Location: Beautiful Rhode Island
6,851 posts, read 11,116,567 times
Reputation: 6837
Quote:
Originally Posted by Submariner View Post
For most Americans their home is their largest asset.

But is it really an 'investment'?

For our first four homes interest rates were high. Let me give you an example. On a $100k Single-Family-Residence, if I made the mortgage payments for 30-years I would have paid a total sum of $300k. That $100k house would have cost me $300k. And if I had sold it for $120k, the IRS would have taxed me on the 'increase between $100k and $120k, ie $20k. While it would have still cost me $300k to buy.

If that honestly an 'investment'?
A married couple does not get taxed on the sale of their primary home- up to $500 of profit.
$250k if you're single.
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Old 01-26-2018, 06:53 AM
 
3 posts, read 1,409 times
Reputation: 10
I was thinking that I am only one concerned with this kind of things.

My parents recently got a home in some retirement village near Sydney, Beauty Point Resort: Retirement Villages Sydney [mod cut - remove URL] , and I can't stop thinking about what will happen with that house when they die?

I don't really see how that is profitable. Is it possible to re-sale them?

Help!

Last edited by VTsnowbird; 01-26-2018 at 07:07 AM..
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Old 01-26-2018, 07:14 AM
 
Location: Scottsdale, AZ
7,654 posts, read 4,699,473 times
Reputation: 27968
Quote:
Originally Posted by NoMoreSnowForMe View Post
But, another upside is that you have control over the place, too. You can paint your walls, get a bunch of dogs, whatever.
Very true, as we insisted on a non-HOA property. So we save a little money there and DH gets to put up his ham radio tower.

I am a little more comfortable on the appreciation angle on this property, as it is a relatively short distance (15 minutes) to Scottsdale shopping and 20 minutes to the Mayo Clinic. I've heard that some of the people who bought waaaay out in the northern-most part of North Scottsdale (where some of the roads are still dirt) are selling up and moving closer to town. We'll have city water and sewer, as well as natural gas. That wasn't the case with any of the other properties we looked at. The other houses all had electric heating (!), several had septic tanks and one actually had to have water hauled in. Wells are not uncommon here either.

Last edited by fluffythewondercat; 01-26-2018 at 07:39 AM..
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Old 01-26-2018, 07:33 AM
 
1,061 posts, read 515,228 times
Reputation: 1814
Quote:
Originally Posted by StealthRabbit View Post
I view a house as discretionary spending to improve my quality of life, not as an investment.



me too (or 3rd or 4th...in this thread)

Personal residence = a Liability, not an asset (Your view may vary)

Since I became a 'caregiver' for a disabled parent at age 18 I have keep multiple living spaces in each residence / location. (if it is not legal / possible to add a residence to the main home, I buy neighbor houses when they become available (have done that in EVERY home)_ +/-... I have 3 neighbors with adult children or grand children living in their extra guest homes... (So.. this plan could backfire) or... it may be needed (for self or caregiver). Works great in rural settings, as there is someone around to watch the place when we travel, & mow, collect mail, pay bills, (taxes) and feed the cats / dogs & livestock. (And blade snow when required).
For AZ... they could clean the POOL!

A farmer friend bought the neighbor house and rented it to an Asian refugee family learning Englisgh and getting Documentation to become US citizens. He then subleased his farm to them (Share cropped with them when he retired). It was a very ideal situation, as they diligently cared for his farm (he made the same income as previous, as they were very productive), then they cared for his wife, then him! (Aging in place)



A realtor friend bought 9 homes in Scottsdale area (during 2008 'price adjustment') I seem to have lost track of him after that! He must have stayed! I would expect he did well on appreciation. (or rental income).

Seems a LOT more seniors are renting, I am 'banking' on that, as I prefer renting to singles and couples.

I consider a late term retirement residence structure (SFH) to potentially be a Royal PITA...
  1. il-liquid
  2. Maint
  3. Lonely
  4. Costly
  5. Inefficient
Me five. The notion of getting rich on the roof over your head is very misguided.
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