Shocked at how many families in nice DMV neighborhoods are living in relatives' homes

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our kid (only-child) just finished kindergarten at a school in an upscale DMV neighborhood.

We've met at least a dozen families at our school who are living in a childhood home or a living in a house own by an elderly parent/relative and "paying rent"(whatever that means)

Though extracurricular activities we've met other families with the same arrangements in Chevy Chase, Bethesda, and upper NW DC. This is, in fact, pretty widespread.

So, if you're slogging away saving for that down payment, paying for child care and wondering "how do all these people do it????"....just know that this is one of the ways you're getting shut out. I'm honestly surprised at how widespread this is happening.

You found me. Our family is living in CCMD in a house that's been held in the family for decades. It's in a good location that will only increase with value, and so the family has no intention of selling it. We've rented and owned our own places before, but we chose to live there to save and be closer to parents, without actually living with them. Our HHI is $300-500K and we "pay rent" (below market rate).

For the most part, this arrangement is a win-win-win. We benefit from saving more of our take home income and reduced need for childcare outside the family. Our parents enjoy having us closer to them and watching the kids. And the family is happy to have someone living in the house and taking care of it.

We plan to move out in a few years, when we'll have enough saved up to move where we want to outside
the DMV.

I thought the irs was quite picky about not allowing paying below market rent to relatives?

I'd be shocked if this was even on the IRS's radar, particularly if we are talking about retirees and W2 income (ie, fairly simple taxes).

The only way the IRS nails someone on this is if they are already doing lots of shady stuff with their taxes - phony deductions, fake businesses, no-show jobs for relatives, etc.

I don’t think this would even matter for anything except the owner would still need to treat it as a personal residence for tax purposes?

[Anonymous]

Anonymous wrote: I feel kind of bad for people who won't ever had a feeling of personal fulfillment from standing on their own two feet

Whatever makes you feel better.

[Anonymous]

I dont see issue. Lots of people in my area are older and retired with a condo in Florida but are snowbirds and still have their big house in Potomac or Bethesda. Which they barely use.

What is big deal with a kid want to live in it?

[Anonymous]

Maybe they are just using the relatives address just to attend certain schools - saying they rent/live with them. They live somewhere else.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our kid (only-child) just finished kindergarten at a school in an upscale DMV neighborhood.

We've met at least a dozen families at our school who are living in a childhood home or a living in a house own by an elderly parent/relative and "paying rent"(whatever that means)

Though extracurricular activities we've met other families with the same arrangements in Chevy Chase, Bethesda, and upper NW DC. This is, in fact, pretty widespread.

So, if you're slogging away saving for that down payment, paying for child care and wondering "how do all these people do it????"....just know that this is one of the ways you're getting shut out. I'm honestly surprised at how widespread this is happening.

You found me. Our family is living in CCMD in a house that's been held in the family for decades. It's in a good location that will only increase with value, and so the family has no intention of selling it. We've rented and owned our own places before, but we chose to live there to save and be closer to parents, without actually living with them. Our HHI is $300-500K and we "pay rent" (below market rate).

For the most part, this arrangement is a win-win-win. We benefit from saving more of our take home income and reduced need for childcare outside the family. Our parents enjoy having us closer to them and watching the kids. And the family is happy to have someone living in the house and taking care of it.

We plan to move out in a few years, when we'll have enough saved up to move where we want to outside
the DMV.

I thought the irs was quite picky about not allowing paying below market rent to relatives?

I'd be shocked if this was even on the IRS's radar, particularly if we are talking about retirees and W2 income (ie, fairly simple taxes).

The only way the IRS nails someone on this is if they are already doing lots of shady stuff with their taxes - phony deductions, fake businesses, no-show jobs for relatives, etc.

I don’t think this would even matter for anything except the owner would still need to treat it as a personal residence for tax purposes?

That would only matter in the case that the older relative wants to sell the residence. Primary residence provides them with a big tax shield on the realized gains.

More common issue is whether they are taking a homestead deduction in spite of adult kids living in the home, which is a local tax issue. It gets a bit murky there.

[Anonymous]

Anonymous wrote:Our kid (only-child) just finished kindergarten at a school in an upscale DMV neighborhood.

We've met at least a dozen families at our school who are living in a childhood home or a living in a house own by an elderly parent/relative and "paying rent" (whatever that means)

Though extracurricular activities we've met other families with the same arrangements in Chevy Chase, Bethesda, and upper NW DC. This is, in fact, pretty widespread.

So, if you're slogging away saving for that down payment, paying for child care and wondering "how do all these people do it????"....just know that this is one of the ways you're getting shut out. I'm honestly surprised at how widespread this is happening.

I don't know...I find this situation much more palatable than the family that just gets a big parent handout to buy a home.

In theory, this family is caring for the elderly parent so it solves a major problem for the elderly parents...which honestly will be a problem for basically anyone. The horror stories of parents at "great" assisted living/nursing homes are plentiful, while the stories of families having to accept that in-home nurses/caregivers will steal from their parents are also common.

Not sure what it is you are angry about in this situation.

[Anonymous]

Anonymous wrote:That’s what happens with restricting housing supply via zoning and giving tax breaks for homeowners. It creates this perverse feudal system of land ownership

Taxing the land properly fixes this

[headdesk]

Feudal does not mean what you think it means.

[Anonymous]

Anonymous wrote:I've been living close to downtown Bethesda for more than 10 years, know hundreds of people from elementary, middle and high schools in the area because my kids are older teens, and NO, this is not a common occurrence, OP.

Why are you so obsessed with other people's living arrangements? We have no family help or high salaries, yet I have zero issues with the people who do. DH and I will be the generation who helps their children. If you have money, you'll do the same for your children. See how that works? Why is it a problem when others do it, but not when you do it?

Your jealousy is making you really stupid.

I do think it is less common in Bethesda and maybe that is why you don't know anybody. Bethesda folks tend to be more of the "working rich" rather than the generational rich who are part of CCMD and CCDC and the private school/country club scene. The Bethesda folks are more likely to receive significant downpayments so they don't have as high of a mortgage.

[Anonymous]

I know two families like this, in close-in Bethesda. They are wonderful people, without an ounce of entitlement, and with terrific kids who aren't spoiled or coddled at all. It really is the luck of the draw.

[Anonymous]

Anonymous wrote: I feel kind of bad for people who won't ever had a feeling of personal fulfillment from standing on their own two feet

Agree. So beta

[Anonymous]

Man, some of these replies are brutal. Never question where rich kids get their nice things, I guess.

[Anonymous]

Anonymous wrote: I feel kind of bad for people who won't ever had a feeling of personal fulfillment from standing on their own two feet

They're fine and feel sorry for you for growing up as a poor. Joking - they're not feeling anything about you at all.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Gross! People are living in your neighborhood and they can't actually afford it? So disgusting. Make sure you don't let your kids play with their kids. Living in your parents house in an expensive "elite area" like the ones you name is cheating. Gross, gross, gross.

Seriously, make sure you protect your kids by not allowing them to play with those kids. And if you see that family at the CC? Well, they are surely cheating with that -- clearly they couldn't afford the dues if they weren't "living at home."

Ugh. Only people who can afford the down payment on a 2M home -- right this minute -- should be able to live in those areas. Is there an HOA? Maybe you could petition them? Find a way to get rid of these freeloaders?

Yes they can’t afford it. Not only because they are freeloading for their living situation but also because the CC gives offspring an enormous discount. It brings the whole club down.

You aren’t a member of a CC are you? The children of members, who are able to take advantage of a discounted rate, have been spending time at that club their entire life with their parents. They learned to swim there. Discovered a love of golf. Made lifelong friends there. The discounted rate is almost like an extension of the family membership they have been a part of since childhood. And you? You are the outsider. If anyone “brings the whole club down” it is you.

This is all true but part of joining a CC is to be around similar people for networking and interesting conversation. Not getting that with the freeloading legacy crowd.

[Anonymous]

Anonymous wrote:I will never sell my house in MoCo. When we retire, I will keep the house and have one of my adult children live in it. Financially it doesn't make sense to sell.

I used to think that but I’m not sure that the county will be same if the council and the planning department have their ways. We bought a vacation house in another county that we might eventually retire to with the idea that we’d let the kids live in our current house later, maybe with another addition, but it’s looking more likely as if we’d just split it up into some multiunit monstrosity and rent it all out. The kids can just have the income to use to live elsewhere and the equity to borrow against.

[Anonymous]

Anonymous wrote:Gross! People are living in your neighborhood and they can't actually afford it? So disgusting. Make sure you don't let your kids play with their kids. Living in your parents house in an expensive "elite area" like the ones you name is cheating. Gross, gross, gross.

Seriously, make sure you protect your kids by not allowing them to play with those kids. And if you see that family at the CC? Well, they are surely cheating with that -- clearly they couldn't afford the dues if they weren't "living at home."

Ugh. Only people who can afford the down payment on a 2M home -- right this minute -- should be able to live in those areas. Is there an HOA? Maybe you could petition them? Find a way to get rid of these freeloaders?

But also they had to have paid for their college and wedding on their own to be as worthy as op to live there. These residents are blocking hard working families that deserve it. /s


This is such an awful sentiment op has but I feel bad how preoccupied they are with other people's business, finances and lifestyles.