Posted on 05/13/2025 6:31:45 AM PDT by where's_the_Outrage?
8 months. That is no good. I’ve been lucky to have had no down time in the last 8 years.
Even when Covid hit and we landlords were warned that we might have to forebear collecting rent if tenants lost their jobs, I still collected as my tenant was military.
So I guess I have been fortunate.
Made more sense when rates were really low. All this depends on what your personal circumstances are.
When mortgage rates were crazy low it was always a good idea if you maintain the property.
“If you own your home you have the peace of mind that you can live in your home for as long as you desire.”
If you can pay your property taxes and the government doesn’t seize the land for eminent domain to make a highway or low-income housing or the neighborhood goes to crap and you run the chance of getting killed.
I read stories everyday of older people losing their house because property taxes continue to rise to force occupants to sell to make way for new development.
Yep. While there may be periods of housing crashes, they don’t last long, they usually recover and end up being higher. Does anyone think that homes will go down to what they were in the 2000’s? 90’s? 80’s? 70’s?
There’s no way. So long as you’re not losing your job during a downturn, along with not having negative equity, you’re fine. It can hit those where downturns result in negative equity and they lose a job.
It’s a longer-term bet imho. You have to live somewhere. I felt I was too stock heavy. I wanted an alternative. I figured investing in a nicer home was a move in real estate, invest in improving the home too (big Trex deck, custom walk-in closets, in-ground pool, landscaping, ...). It may not be the ‘best’ move in terms of highest growth, but you have some diversification from the stock market while *enjoying* your house every day. Having locked in a mortgage at 2.8% - almost half my payment was principal on day one. It’s much like putting money from one pocket into the other. It will be worth more than I bought it for (already is, much more).
I plan to retire in a smaller home, selling this one will allow me to have the retirement home fully paid. There is no perfect formula, and I’d argue a perfect ‘math formula’ for retirement does not equal enjoying life while you’re living. You must balance both.
Financial planner Bob Brinker used to tout this approach 50 years ago on his national radio simulcast. I agreed with his approach, i.e. sleep well at night, no worries. He also said when you get to the point where your assets are throwing off enough income your sole worry each day is do I sail north or south on the intercoastal waterway!
They want their share in taxes every month and are brutal about it. That and regular maintenance mean you lose money, even after capital gains.
“F___ you, pay me!”
The numbers here in Newport, next to Huntington Beach are insane. The thing about market corrections here at the beach, is that they are never close to as bad as market drops inland. No matter how bad the economy is, somebody has money, and they always want to live at the beach...
Not to mention all the potential buyers have blown town to move South.
The purchase of a home is one of the best ways for the average American to build wealth.
The craziest thing about CA folks who live near the beach is that many claim they are worried about rising seas from climate change...at least in public.
Lol.
The key to a young person is: get a good education, get a good job, and live within your means.
That means buying a house you can afford and no more. Later, trade up if you need or want to.
I was talking to a very wealthy man about this recently. I asked him what his essential financial wisdom is. He lives in a home probably $10M in value.
His main thing is keeping his cash highly mobile. He prefers the ability to call his guy and move X million $ from place to place in five minutes. Real estate, at least for him, is too static.
Yep, but the weather is so nice. I recall staying in Newport Beach and playing golf at Pelican Hill in the early 90's. I recall looking down at a par 3 green and there were perhaps 10 Mexicans bending over cleaning off the Green - never saw that before.
Well said.
In essence - a good investment for an investor, but not an economical investment (30 years of a mortgage and large property taxes) as a “owner occupied single family residence”.
I planned my own finances and made a LOT of money of my homes over the years. Buying rental homes, converting them to second homes and later converting them to primary residences and then selling them with no tax liability is a great strategy, so easy. Plus, when you own a home, you move or stay when YOU want rather than when your landlord wants. I’m living in my third “rental to second home to primary residence conversion” now and it’s free and clear.
We knew several people who sold their home and rent now. Local landlords are desperate for steady income and less needy tenants. The low income renters are a nightmare, pilling up trash and pets and then not paying rent.
RIP BB. He died last fall. He gave great advice to the unsophisticated investor. If Ibonds were hot, he suggested buying them, etc. He was also pushing one of the federal credit unions for high returns on CDs.
Sweet
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.