Someone needs to tell the author that buying a second home is not spending as in pi$$ing it away on wine and trips. Second homes are usually vacation homes that have been known to increase in value sharply. A 100K waterfront home in Florida the 1980’s is worth in excess of 500K today. A 400% increase is a pretty good investment.
Sounds like a very poor investment.
Over a period of, say, 35 years, even if you're achieving a return of only, say, 7% per annum, $100K will double every decade, thus becoming approx. $1m. (I personally have maintained an average of 10% p.a. since 2002.)
Of course, you can't live in stocks and bonds. But then neither do they ever require a new water heater, resurfacing of the driveways, or suffer hurricane damage.
Regards,
The other option, if you’re younger than 59 1/2 and would get the big tax penalty, is to make a minimal down payment on a long term loan. Then pay the monthly mortgage payments until you CAN withdraw it without penalty at that magic age.
The other option, if you’re younger than 59 1/2 and would get the big tax penalty, is to make a minimal down payment on a long term loan. Then pay the monthly mortgage payments until you CAN withdraw it without penalty at that magic age.
Too good for the people who owned them.
$100K waterfront homes in Florida in the 1980s were being seized via eminent domain after the Kelo decision, until homeowners sued to put a stop to it.
-PJ