How much $ to buy vacation home

[Anonymous]

It depends what your retirement goal is, how close you are to your goal, and how secure the income is. I personally would need $4 million in investments (excluding college costs), no mortgage on primary home or additional money set aside, plus the cost of the vacation house available in cash before I would feel comfortable. For me that would be about $6 million.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

[Anonymous]

I'd want to keep the percentage of my portfolio in real estate to under 30%. And I'd want my income to be high enough to be able to cover the costs without feeling any pain. AS PPs have pointed out, monthly costs can be hefty. And what if there's a broken pipe while you are gone?

Our real estate is 40% of assets (includes a rental condo, main house, weekend house), and the weekend house costs about 12% of income. It's doable, but a bit uncomfortable. I think more and more about selling, even though we are there most weekends, it's an hour away, and brings lots of joy.

Owning = headaches. Renting = drop off the key and forget it

[Anonymous]

Anonymous wrote:We spent a little over $1m for a second home. At the time we had around $4m saved. We took out a hefty mortgage and have been paying it off aggressively. We have very little mortgage left on our primary home so our total is below the deductibility limits (which of course didn’t exist when we bought it).

We don’t rent it out so it’s all out of cash flow, which is fine. Agree with PP that it’s not an investment, it’s a luxury/expensive hobby. The house has certainly appreciated but we have no plans to sell it. It’s an extension of our primary house.

I’m surprised you are finding condos/houses that you would rent for $20k week for under $1m. We ski in the west several times a year. The house we rented in park city this season for $6k at Christmas was worth about $800-900k. A house that rented for $15-20k would be much more expensive.

This pretty much describes our situation as well. I will also add that in Delaware you dont really have property tax. I think we pay about 1K on our $1.5M home.

[Anonymous]

8-10m. But we are more conservative in real estate than many in this area. Also, unlike others on this thread, I’d want my primary paid for before buying a second home.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

Really and you don’t want to just pay off your mortgage? Or honestly, upgrade your primary home and rent a vacation home? At your income I’d definitely be in a 2-2.5m home.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

Really and you don’t want to just pay off your mortgage? Or honestly, upgrade your primary home and rent a vacation home? At your income I’d definitely be in a 2-2.5m home.

No desire for a bigger, fancier house. We like our neighborhood, where our house fits in just fine. Our mortgage interest is 3.25 so we’re not paying it off. Also, we have zero interest in fancy cars—we have a minivan and a Prius.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

All the more reason, to keep spending in check, pay off your primary residence, shore up retirement and kids college costs now. Then pay cash for a second home. If everything is on credit, you have nothing at the end if things go south.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The condo fees range from $650-$1000/month. All in, taxes, condo fees and maintenance will be about $30k/year. Right now we are going during Christmas and renting a place is $$$ (ski town).

so for 30K/yr you could rent a ridiculous house in Aspen for 3-4 weeks. Or you could just travel to Utah, Colorado, Wyoming, Austria, France, or Switzerland and ski instead of going to the same place all the time. Your kids will be bored.

Have you looked at prices at these places? Week at Christmas in Aspen for a 2 bedroom condo it is $20,000 at a place that is nice but not crazy. Last year we spent $15k for a week in Park City at Christmas time.

I have no idea what you are looking at, that has not been my experience at all and we do at least 2 weeks out west each year. Honestly are you the same person who insists that it costs $1,500/nt to stay in Manhattan (as if the Mandarin is the only gig in town), when in reality you can get a great room for $700?

I'm actually booked AT Snowmass in Crestwood this coming Christmas, check in 12/26, check out 1/1. The condo is slope side and is ski in ski out. The community has all amenities, including boot and ski storage, concierge, heated outdoor pool, fitness center and is in the village. For a 2 bedroom,I'm paying $4,700. We did Aspen proper last Christmas and liked Snowmass best because you cannot ski in/out in Aspen and have to take a shuttle everywhere. Plus Snowmass has more for the kids.

This. You have to struggle to find a place that costs 20k to rent a week and if you can find that, the sale price would be wayyyy over 1M. We too head out there and like to stay alongside and by far our lift tickets are much more expensive than the condo we rent. I actually think condos are pretty reasonably priced.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

All the more reason, to keep spending in check, pay off your primary residence, shore up retirement and kids college costs now. Then pay cash for a second home. If everything is on credit, you have nothing at the end if things go south.

We are paying cash.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

All the more reason, to keep spending in check, pay off your primary residence, shore up retirement and kids college costs now. Then pay cash for a second home. If everything is on credit, you have nothing at the end if things go south.

We are paying cash.

But you still have a mortgage on your primary house as well as woefully inadequate retirement and college funds. Get those on more solid ground before you go for the splurge house.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

All the more reason, to keep spending in check, pay off your primary residence, shore up retirement and kids college costs now. Then pay cash for a second home. If everything is on credit, you have nothing at the end if things go south.

We are paying cash.

But you still have a mortgage on your primary house as well as woefully inadequate retirement and college funds. Get those on more solid ground before you go for the splurge house.

This is totally dependent upon their age. If they are 30 with $1.5m in retirement and $200k in 529s with kids who are 2 and 4, they are in excellent shape. If they are 45 or 50, totally different story.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much money do you think it is prudent to have in retirement and investments before buying a vacation home (really a condo)? Some facts - have a $1.5m house here with mortgage around $800k. Rate is low, so no plan to pay this off early, plus we deduct the full amount of the interest payments. With vacation home, we would likely pay cash since we are maxed out on interest tax deduct and it is not a necessity. How much would you want in the bank to feel like this is not a stupid thing to do? We would pay costs associated with house out of cash flow (taxes, condo fees, etc).

We are biting the bullet and buying a vacation house, but not without some angst just because it is such an expensive luxury and we are not used to spending like this given our relatively frugal personalities and working class backgrounds. Vacation house is $500K. HHI is almost $2M. About $1.5M saved for retirement, $200K for kids' college, 15-year mortgage on a house worth about $1.2M with PITI about $4K (less than $500K left on mortgage). We have about $800K liquid.

Did you just start making that much? Because our savings/investments/college are quite a bit higher and our income is lower.

Yes, just a couple of years ago. Also, both of us come from working class backgrounds, so no financial support from family for college tuition, grad school, wedding, or down payment on house.

All the more reason, to keep spending in check, pay off your primary residence, shore up retirement and kids college costs now. Then pay cash for a second home. If everything is on credit, you have nothing at the end if things go south.

We are paying cash.

But you still have a mortgage on your primary house as well as woefully inadequate retirement and college funds. Get those on more solid ground before you go for the splurge house.

This is totally dependent upon their age. If they are 30 with $1.5m in retirement and $200k in 529s with kids who are 2 and 4, they are in excellent shape. If they are 45 or 50, totally different story.

I say save in the beginning when you have such a HUGE income. It may or may not last. If you spend it all and it goes away- then you will be stuck. If you get everything stocked, then you can have a much nicer life for your whole life.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The condo fees range from $650-$1000/month. All in, taxes, condo fees and maintenance will be about $30k/year. Right now we are going during Christmas and renting a place is $$$ (ski town).

so for 30K/yr you could rent a ridiculous house in Aspen for 3-4 weeks. Or you could just travel to Utah, Colorado, Wyoming, Austria, France, or Switzerland and ski instead of going to the same place all the time. Your kids will be bored.

Have you looked at prices at these places? Week at Christmas in Aspen for a 2 bedroom condo it is $20,000 at a place that is nice but not crazy. Last year we spent $15k for a week in Park City at Christmas time.

If this is OP, I hope your spouse is making the financial decisions. You are dillusional. And stupid to spend 15k for a week at Park City. Were you staying at the Waldorf Astoria? Lol!