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Ragoo
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In reply to AggieFrog • 8:19a, 4/9/20
AG
AggieFrog said:
Quote:
i would say the millionaire next door would stay in the $350k house forever and no one around him would know he was a millionaire.
That's us in a $250k home. Really don't care for huge, expensive homes. We're at 2,500 sq. ft. now and if anything will downsize once the kids leave in a few years. Both cars are also over 6 years old and nearing 100k miles (both paid for years ago).
i don't understand downsizing.

When your kids move out and have there own families presumably you will want to host them and their kids at your home. A downsize makes that less accommodating. And if they feel like it is a lot of trouble to come visit they won't come visit.
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AggieFrog
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In reply to Ragoo • 8:38a, 4/9/20
AG
Ragoo said:
AggieFrog said:
Quote:
i would say the millionaire next door would stay in the $350k house forever and no one around him would know he was a millionaire.
That's us in a $250k home. Really don't care for huge, expensive homes. We're at 2,500 sq. ft. now and if anything will downsize once the kids leave in a few years. Both cars are also over 6 years old and nearing 100k miles (both paid for years ago).
i don't understand downsizing.

When your kids move out and have there own families. Presumably you will want to host them and their kids at your home. A downsize makes that less accommodating. And if they feel like it is a lot of trouble to come visit they won't come visit.
What do you mean by hosting? Been married 15 years and kids are teenagers - we've never stayed at either my parents or wife's parents. Don't need a huge house just to have dinner or host get-togethers (most family events growing up were in my grandparent's 1500 sq. ft. house). We'll probably end up with a small apartment around a city center with open green space, or a tiny home - either way with mid-size travel trailer. Last thing I want is a huge house - would much rather a small living space with plenty of outdoor area (either my own or public green space).
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Quinn
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8:50a, 4/9/20
AG
Where are y'all getting these sub-$300,000 homes? Or is that what you bought for over a decade ago? We didn't see much at all in Dallas proper (or the suburbs we liked) for under $300,000 back in 2016, and that was looking for a 3/2.
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CaptnCarl
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In reply to Quinn • 9:00a, 4/9/20
AG
My thoughts exactly. Must not have kids either.
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Ragoo
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In reply to AggieFrog • 9:02a, 4/9/20
AG
Weird. We always stay at my parents or in-laws when we go visit.
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AggieFrog
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In reply to Quinn • 9:04a, 4/9/20
AG
Quinn said:
Where are y'all getting these sub-$300,000 homes? Or is that what you bought for over a decade ago? We didn't see much at all in Dallas proper (or the suburbs we liked) for under $300,000 back in 2016, and that was looking for a 3/2.
We have a 4/2.5 just west of 820 in far west Fort Worth. 20 minutes to downtown FW, 10-15 minutes to Camp Bowie, or 20 minutes to Weatherford. New home built last summer for 250-ish on a larger corner lot.
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AggieFrog
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In reply to Ragoo • 9:05a, 4/9/20
AG
Ragoo said:
Weird. We always stay at my parents or in-laws when we go visit.
Do you live < 30 minutes away? Kids have stayed, but not us (no reason to).
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Ragoo
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In reply to AggieFrog • 9:07a, 4/9/20
AG
AggieFrog said:
Ragoo said:
Weird. We always stay at my parents or in-laws when we go visit.
Do you live < 30 minutes away? Kids have stayed, but not us (no reason to).
no and I wouldn't assume your children will live that close in the future.

Just my opinion with regards to downsizing.
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AggieFrog
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In reply to Ragoo • 9:09a, 4/9/20
AG
Ragoo said:
AggieFrog said:
Ragoo said:
Weird. We always stay at my parents or in-laws when we go visit.
Do you live < 30 minutes away? Kids have stayed, but not us (no reason to).
no and I wouldn't assume your children will live that close in the future.

Just my opinion with regards to downsizing.

Exactly - I figure they'll live all over, so more likely going to them. If they're half as busy as we are with kids, they aren't coming to us with any regularity.
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Quinn
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In reply to AggieFrog • 9:18a, 4/9/20
AG
AggieFrog said:
Quinn said:
Where are y'all getting these sub-$300,000 homes? Or is that what you bought for over a decade ago? We didn't see much at all in Dallas proper (or the suburbs we liked) for under $300,000 back in 2016, and that was looking for a 3/2.
We have a 4/2.5 just west of 820 in far west Fort Worth. 20 minutes to downtown FW, 10-15 minutes to Camp Bowie, or 20 minutes to Weatherford. New home built last summer for 250-ish on a larger corner lot.
You can build a house for $250ish? Land included? No saying you're lying (promise), just would have never guessed that. I would have figured it would have been more expensive. Our next house will probably be in the suburbs between Dallas and FW, and I'm budgeting $350-400 for a 4/3.
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redag06
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In reply to Ragoo • 9:19a, 4/9/20
That all depends where the kids end up.

My parents are 20 minutes away and in-laws are a little over an hour away, we never spend the night.

If my kids end up moving out of state maybe we move or maybe we build a garage apartment. Currently in 2700+ sqft home with the intent of being here for the long haul.
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Grown Pear
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9:27a, 4/9/20
AG
I just want to say I'd prefer a nice $100K cabin on a $1MM plot of land than a $1MM house on a $100K lot.That is all... is that too much to ask for!! lol
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AggieFrog
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In reply to Quinn • 9:32a, 4/9/20
AG
Quinn said:
AggieFrog said:
Quinn said:
Where are y'all getting these sub-$300,000 homes? Or is that what you bought for over a decade ago? We didn't see much at all in Dallas proper (or the suburbs we liked) for under $300,000 back in 2016, and that was looking for a 3/2.
We have a 4/2.5 just west of 820 in far west Fort Worth. 20 minutes to downtown FW, 10-15 minutes to Camp Bowie, or 20 minutes to Weatherford. New home built last summer for 250-ish on a larger corner lot.
You can build a house for $250ish? Land included? No saying you're lying (promise), just would have never guessed that. I would have figured it would have been more expensive. Our next house will probably be in the suburbs between Dallas and FW, and I'm budgeting $350-400 for a 4/3.
It's not custom and is in a starter home neighborhood by DR Horton. We're in the largest layout of the development, but it works for us. New homes with this floor plan are going for $280+ this year. Love the location - easy to get to anything west of 35W and very little traffic. Also literally across the street from the kids' private school so they can walk to school / athletic practice / games / etc.
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Ed Carter
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9:38a, 4/9/20
AG
West of 820.....aka BFE with neighborhood being built on top of neighborhoods. That's why he built so cheap...

And it's funny you think your kids won't ever be coming to stay with y'all when they are older and have families of their own...
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AggieFrog
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In reply to Ed Carter • 9:48a, 4/9/20
AG
Ed Carter said:
West of 820.....aka BFE with neighborhood being built on top of neighborhoods. That's why he built so cheap...

And it's funny you think your kids won't ever be coming to stay with y'all when they are older and have families of their own...
Definitely not BFE (unless you're tied to the Dallas to Frisco side of the Metroplex which we're not) and it's still pretty open out here (for the next few years at least), but still very close to all the amenities / restaurants in Fort Worth. Not sure why that's funny - different families operate differently. Our family time is hunting / fishing out on our land by Abilene or going to ball games, not in a house in the city. We're outside more than in.
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Quinn
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In reply to AggieFrog • 9:51a, 4/9/20
AG
Good deal
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RightWingConspirator
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In reply to CaptnCarl • 9:55a, 4/9/20
AG
CaptnCarl said:
So where else are you putting your cash? The stock market?


Yes, I've got about half my portfolio in Merrill and the other half with Fidelity. I fund two back door Roths for me and my wife, we fully fund our HSA and we do a jumbo Roth contribution at the end of the year when I roll all of my after-tax 401k contributions into a Roth. We also fully fund the 401k with the $57,000 limit (this year). We have done all of this for several years. I have about a year's worth of emergency funds as well.
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CaptnCarl
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In reply to RightWingConspirator • 12:58p, 4/9/20
AG
So is it fair to say you're mainly trying to avoid the increase in tax liability in a $300k home? Or your cash will appreciate faster in stocks vs real estate?
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Grown Pear
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In reply to CaptnCarl • 1:06p, 4/9/20
AG
CaptnCarl said:
So is it fair to say you're mainly trying to avoid the increase in tax liability in a $300k home? Or your cash will appreciate faster in stocks vs real estate?
My guess is primarily property tax liability but also the ongoing foreseen and unforseen expenses (ie increased utility bills, property insurance, likelihood of have to purchase and maintain additional things like A/C units, etc). That's if owning outright, otherwise throw in more interest cost on mortgage/higher monthly outflow payment and likely opportunity cost related to those funds going into alternative investments like you mentioned.

I think I just talked myself into buying a smaller home.
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RightWingConspirator
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1:06p, 4/9/20
AG
Honestly, I'm a type 1 diabetic and so I live most of my life paranoid that I'll lose my job. The drug costs alone would break me in a relatively short period of time. My main motivation for living far beneath my means is to keep my costs super low so I have savings to fall back on in a contingency. We have a nice home. It's about 3200 sq ft. It is a 4/3.5 place in a nice neighborhood. I think today we could probably get $350 for it, but I paid only $276 for it. That is a little over 1x my yearly salary. It is what we need. We don't need more than that. We have a rainy day fund that could carry us for a year or two. All this is made possible because I live far beneath my means. It has also allowed us to save substantially over a short period of time.
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DonaldFDraper
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In reply to AggieFrog • 6:16p, 4/9/20
AG
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YouBet
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In reply to Rice and Fries • 6:41p, 4/9/20
AG
Rice and Fries said:
YouBet said:
The great house debate is pretty much a weekly occurrence in our household....usually on the weekends once my wife starts perusing the Ebbie Halliday app (Dallas based). She kind of got me addicted to doing it too though.

For us, it's primarily an academic exercise and done out of boredom because we already have a second home on the coast (inherited), but here are the points I keep coming back to on upgrading to a $1M house (for example):

  • It's the just two of us and once you start getting into that price range the resulting square footage would be ridiculous for two people. The idea of having to maintain that much house gives me seizures. Our current house is 3,400 and that is really too large for us, but we at least use all of it due to the layout.
  • The resulting cost of furniture and crap you would have to buy just to fill it is pointless extravagance.
  • Maintenance and utility bills for that house. Oy vey.

Our current struggle is that we would really like to move out of Dallas, but our commutes are awesome and I just don't know if we could survive that trade off. Also, what I would really want is a smaller, one story home that is totally decked out but those types of houses simply don't exist here. We would have to build it or completely gut and renovate an existing home which is also something I have zero desire to do. So, we stay.


Do you guys have kids?

My curiosity is that if you did and have two or more, what would your stance be then?

I would feel that somewhere like Fairview and a 4000sf would be perfect if you had two or three kids and you had ~10 years before the first one started falling off to go to college would be good.


We are DINKs.
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Rice and Fries
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In reply to zsh0 • 4:12p, 5/17/20
zsh0 said:
Quote:
I am frequently astounded by the levels of consumption that I see on a daily basis, relative to what I know to be the income and net worth distribution in America.


This is what worries me in the long run...the 1% of people who worked hard and saved and invested are going to get the shaft when the government has to take care of the other 99%. Either by direct taxation on the "wealthy" or indirect devaluing of worth by printing money and inflation, the chickens will come to roost.


God this comment is too true in today's world.
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Cyp0111
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In reply to Rice and Fries • 8:42p, 5/17/20
Own real estate and other assets. I think inflation will eat the lunch of the bottom 90%.
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Rice and Fries
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In reply to Cyp0111 • 9:20p, 5/17/20
I do think we will see a devaluation in real estate assets. I work in CRE lending and it's rife with borderline fraud.

Example: someone buys an old apartment complex, slaps some light renovation and new coat of paint on it. Jacks the rent up a few hundred/month. Then they go get it refinanced with a new valuation that is 25%+ higher. Take the cash out refi and keep doing it.

Now I'm not saying that is not a viable money making strategy, but there's only so much room to push rents. Older apartments are historically occupied by the working/blue collar workers. Their wage growth isn't growing and with looming high unemployment, you'll start seeing these "flippers" give the keys back to the lender. I just think we will see a purge of these high leveraged operators with no cash reserves.

But In the long run (18-24months), we are going to see the effects of money printing and see high inflation.
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Cyp0111
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In reply to Rice and Fries • 9:28p, 5/17/20
I agree with that. Leverage is your friend until it wipes you out. A lot of the RE/rental market built on 5x+ leverage is going to blow up in peoples faces, esp. people w minimal cash reserves.
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AggiePeeps06
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In reply to Cyp0111 • 10:47p, 5/17/20
AG
Unless the Fed backstops CRE and RE. Did you see today they said they would most likely be buying equity ETFs and individual stocks? Unreal
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Fightin_Aggie
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In reply to Rice and Fries • 10:56p, 5/17/20
AG
Rice and Fries said:
I do think we will see a devaluation in real estate assets. I work in CRE lending and it's rife with borderline fraud.

Example: someone buys an old apartment complex, slaps some light renovation and new coat of paint on it. Jacks the rent up a few hundred/month. Then they go get it refinanced with a new valuation that is 25%+ higher. Take the cash out refi and keep doing it.

Now I'm not saying that is not a viable money making strategy, but there's only so much room to push rents. Older apartments are historically occupied by the working/blue collar workers. Their wage growth isn't growing and with looming high unemployment, you'll start seeing these "flippers" give the keys back to the lender. I just think we will see a purge of these high leveraged operators with no cash reserves.

But In the long run (18-24months), we are going to see the effects of money printing and see high inflation.
Seeing all this money being printed is definitely a worry. Work more make more and it is worth less. Super sucks.
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Bocephus
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1:40a, 5/18/20
AG
How many of y'all plan to live in your current home in retirement?
TAMU ‘98 Ole Miss ‘21
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Cyp0111
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9:28a, 5/18/20
Ideally my wife and I would live on land/ranch and have something in Houston/where kid(s) live.
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AgOutsideAustin
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In reply to Bocephus • 3:45p, 5/18/20
AG
I will unless something changes. Never "moved up" in house when the kids came along so I'll just remodel the 2,050 square footer some. Once kids are gone their rooms become guest bedrooms.
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proudaggie02
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In reply to Bocephus • 4:26p, 5/18/20
AG
Bocephus said:
How many of y'all plan to live in your current home in retirement?
I don't plan to do so, but I'm not against it. We'll probably spend 20-30 days/year in San Diego (we'll likely buy a condo there) and 30+ days/year in the Colorado mountains. It would make sense to downsize a little, but I could also see spending more if we find a house we love with great views.
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MAS444
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In reply to Bocephus • 4:45p, 5/18/20
AG
Just built a new house that we plan to raise our kids (5 year olds) in and don't have any plans to stay here for more than 15-20 years.
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Dr. Horrible
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In reply to Bocephus • 6:33a, 5/19/20
Not a chance in hell
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AgCPA95
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In reply to Bocephus • 8:30a, 5/19/20
AG
Bocephus said:
How many of y'all plan to live in your current home in retirement?
This comes up from time-to-time while chilling in backyard or pool. We love our house, amenities we added, neighborhood and location in relation to lot of things - don't want to live in Houston but work there, decent commute to work, close to my family (hers is out of state), easy access to get to College Station which were visit ~ 10-12 times per year and easy access to 2 airports. But it is way too much house once the youngest is done with college in about 8-9 years and hopefully out earning his own living. We bought way below our means so it remains very affordable so I think that has a lot to do with us maybe staying even longer if continue to like it in 8-10 years as at that point we would like to hang it up and travel some more.
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