s/o--so how did you afford a 2 million dollar home?

[Anonymous]

we've debated ad nauseam on this week's thread (and others) on what it takes to afford a million dollar home. How about a 2 million dollar home? How did you buy it or did people you know buy it?
It seems like many people we know (mostly peripherally) are buying homes at this price point---many of them in their early to mid 30's. How is this done?

[Anonymous]

You sell your first home and make at least $400K so you can put down 20%, and you have an HHI sufficient to qualify for a massive-ass mortgage.

Or you ask daddy to buy it for you.

[Anonymous]

Speaking only for myself, I made a career in gay porn. Very lucrative.

[Anonymous]

My one friend who bought a $2.5 million house has a husband who works for a hedge fund. They made about $700,000 on the sale of their first home. They were in their late 30s when they bought it.

[Anonymous]

Anonymous wrote:Speaking only for myself, I made a career in gay porn. Very lucrative.

In front of the camera, or behind?

I know two people with $2M+ homes who made their money on the production side. Straight porn, tho.

[Anonymous]

Made lots of money in sales of previous houses for the down payment. And we have a hhi to support the remaining mortgage, parents gave the closing fees as gift. Never touch the trust fund. Seriously.

[Anonymous]

OP, are you for real? WTF do you do with YOUR money?

[Anonymous]

Family money. Those who purchased without any assistance are the exception, not the rule.

[Anonymous]

Good friends just bought a house for just over $2M (and they own a $1m-ish (my estimate) vacation home. He's a partner at a dc law firm (just turned 40) and they don't have any family money. kids are in public school or about to be, and they drive really nice cars and take nice vacations. I dont know their saving habits or how much they put down. I do remember talking about 529s so they have definitely been putting money away for the kids.

[Anonymous]

Anonymous wrote:Good friends just bought a house for just over $2M (and they own a $1m-ish (my estimate) vacation home. He's a partner at a dc law firm (just turned 40) and they don't have any family money. kids are in public school or about to be, and they drive really nice cars and take nice vacations. I dont know their saving habits or how much they put down. I do remember talking about 529s so they have definitely been putting money away for the kids.

Numbers don't add up. Either they have family money or they are saving very little. Putting some money in a 529 is only a fraction of what they should be saving right now.

Big Law isn't an annuity these days. Last person I knew who came from this type of background and took on this much mortgage debt ended up in a government job later and the vacation home in the Outer Banks hit the market soon thereafter.

[Anonymous]

It all depends what he makes, PP, and where he is partner. There are in big DC firms where partners make far less than I make (non-partner at non-DC firm). And there are places where partners make $10 million or more per year. A partner making $1 million or more is pretty common, even for non-rainmakers, in some firms.

We could do it pretty easily if we wanted to, but we would have to sell our second home for us not to feel house poor, and we don't want to do that yet. It isn't clear to me that you really get that much more for $2 million than our current $1.25m house anyway. What I'd really like to know is how to afford a $3+ million house!

[Anonymous]

Anonymous wrote:It all depends what he makes, PP, and where he is partner. There are in big DC firms where partners make far less than I make (non-partner at non-DC firm). And there are places where partners make $10 million or more per year. A partner making $1 million or more is pretty common, even for non-rainmakers, in some firms.

We could do it pretty easily if we wanted to, but we would have to sell our second home for us not to feel house poor, and we don't want to do that yet. It isn't clear to me that you really get that much more for $2 million than our current $1.25m house anyway. What I'd really like to know is how to afford a $3+ million house!

The number of law firms in DC where partners in their early 40s pull down anything like $10 million a year is very limited. He'd either need to be a huge rainmaker or the firm would have to have hit the jackpot with a big contingency fee.

$1 million a year pre-tax for someone with no family money isn't an amount that would make me feel comfortable having two mortgages on $3 M or more in real estate.

[Anonymous]

Anonymous wrote:It all depends what he makes, PP, and where he is partner. There are in big DC firms where partners make far less than I make (non-partner at non-DC firm). And there are places where partners make $10 million or more per year. A partner making $1 million or more is pretty common, even for non-rainmakers, in some firms.

We could do it pretty easily if we wanted to, but we would have to sell our second home for us not to feel house poor, and we don't want to do that yet. It isn't clear to me that you really get that much more for $2 million than our current $1.25m house anyway. What I'd really like to know is how to afford a $3+ million house!

I am a biglaw partner and I never heard of any making $10 million. (But I also doubt there are any DC partners making "far less" than a nonpartner at a non-DC firm). Generally speaking if a 40ish YO partner buys a $2M house, I think they've overbought. I know a handful of people with $3M houses. Most are heart surgeons.

[Anonymous]

Anonymous wrote:Family money. Those who purchased without any assistance are the exception, not the rule.

Same here. Everyone I know with a $2M+ home has family money.

[Anonymous]

We did it in our own. DH worked for a privately held company that went public, and he received stock options. Not enough for us to quit working, but enough to buy a really nice house with no mortgage and send kids to private school. Yes, we are very lucky, though DH has also worked really hard and continues to do so. When we bought, it seemed like real estate was the safest place to put the money. Now we're over invested like so many others.