$2M home w/ $160k HHI?

[Anonymous]

And question 2. The developer built it as a separate legal rental. And yes, I plan to use it for what it was built for.

[Anonymous]

Anonymous wrote:I was low-income and inherited a house. I never had the money for the maintenance but at least my kids got into a decent school district.

My suggestion would be to run the numbers: taxes, utilities, 1% for maintenance costs. Then figure out how much of your 2m would you have to put in a more conservative investment to generate some of the income to run the house. My guess is that if you drop your purchase point, you could either invest in a second property, rent it and generate enough to pay the taxes and maintenance on your primary residence, or keep some in the market (more conservative investments) and use that to supplement income.

Where would someone find an income generating rental in this market?

[Anonymous]

Anonymous wrote:Maintenance, upkeep, furnishings, and landscape maintenance will suck up all of your disposable income and then some. I'd split the difference - find a nice, updated, well-maintained but slightly smaller home for $1M-ish. Put another $0.5M in a low-risk account to cover your move-in costs (including furnishings) and 5-10 years of maintenance. Keep investing the other $0.5M.

Good luck with that in this market.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Maintenance, upkeep, furnishings, and landscape maintenance will suck up all of your disposable income and then some. I'd split the difference - find a nice, updated, well-maintained but slightly smaller home for $1M-ish. Put another $0.5M in a low-risk account to cover your move-in costs (including furnishings) and 5-10 years of maintenance. Keep investing the other $0.5M.

Good luck with that in this market.

This is a tough market for a nice $1M home in a desirable neighborhood around DC. But financially the plan is a good one, personally I would bump a bit higher to 1.2-1.4 which opens up a bunch more options and carry a small mortgage.

[Anonymous]

On our 2 mil house that we paid cash for we spend 50k a year on taxes, landscaping, pool maintenance, utilities. Add in more if you have a housekeeper and for all of the maintenance and periodic renovations that need to be done over time to maintain the home’s value. Our income is about 500k and I still regret the decision. We are house poor. It may depend on if you are a do it yourselfer on the cleaning,landscaping, and home improvements and whether you have kids private school/college costs, like to travel, etc.

[Anonymous]

OP must be a troll. Smart enough to make millions in stocks but comes to DCUM for advice on buying a house???
C’mon man!

[Anonymous]

Anonymous wrote:

Anonymous wrote:What are the taxes on the home? At that price, they may Be like an income appropriate mortgage that will never end. So at local rates around here that’s $20k per year on taxes alone. Plus upkeep, dues, etc. Why be permanently house poor? Buy a million dollar house and keep some money in the bank. [/quote]

One million home will really make you house poor cause it requires constant attention. 2 million gets you something more decent.

Not from the DC area so I don’t know what things cost there. I do know it’s expensive.
Are you saying that $1MM homes are money pits but $2MM homes are practically maintenance free?

[Anonymous]

Anonymous wrote:On our 2 mil house that we paid cash for we spend 50k a year on taxes, landscaping, pool maintenance, utilities. Add in more if you have a housekeeper and for all of the maintenance and periodic renovations that need to be done over time to maintain the home’s value. Our income is about 500k and I still regret the decision. We are house poor. It may depend on if you are a do it yourselfer on the cleaning,landscaping, and home improvements and whether you have kids private school/college costs, like to travel, etc.

You must have a ton of other expenses if your income is 500k and home expenses only 50k.

[Anonymous]

Buy a 2 million home with a separate garage apt/basement apt. When you feel stretch for maintenance cost, rent this additional apartment out for 2000/month. You will be fine.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What are the taxes on the home? At that price, they may Be like an income appropriate mortgage that will never end. So at local rates around here that’s $20k per year on taxes alone. Plus upkeep, dues, etc. Why be permanently house poor? Buy a million dollar house and keep some money in the bank. [/quote]

One million home will really make you house poor cause it requires constant attention. 2 million gets you something more decent.

Not from the DC area so I don’t know what things cost there. I do know it’s expensive.
Are you saying that $1MM homes are money pits but $2MM homes are practically maintenance free?

Not sure if 2 million home is maintenance free, but 1 million home in this area is mostly craps...

[Anonymous]

https://www.dcurbanmom.com/jforum/posts/list/30/914955.page

The house /neighborhood that OP posted is being discussed in this thread. Useful discussion on what the market for that house is like.

[Anonymous]

That's stupid as sh&t.

[Anonymous]

I would not. I would pay cash for a nice house in a nice area around $900k-$1 mil and then buy one or more good investment properties for cash to rent out. You’d have no mortgage and a steady stream of income that you could start investing again. If you can replicate your success then sure trade up your primary residence.

[Anonymous]

Yes, carrying costs for a $2M SFH are high - utilities, Lanscaping, and maintenance, as well as taxes. We live in MoCo and recently bought a house at that price point and easily spend $50K per year on household expenses. That includes a weekly cleaner (as we both WOH) and it’s a large house, yard/landscaping, and funds for all the stuff that breaks/needs work. It does not include any updating or cosmetic changes which you will eventually want to make, or big projects like a new roof which we are going to have to take on in a couple of years.