- What did you do differently that enabled you to retire in a HCOL area?
- How did you end up paying for your primary home? Did you live in flip, churn, or did you buy one home and pay down the mortgage?
- Do you think the currently espoused MMM method (live frugaly, save the max) can work for a HCOL area? I find that even with a dual high income it probably wont work within a decade
- What big bets/risks did you make that paid off?
I have searched high and low for a good HCOL area thread on the forums, but couldnt find one. If anyone knows of one please refer me to it. Thanks! Look forward to hearing from you!
I bought a run down house. I put up with its problems for years, and as I got the money, I fixed up one room at a time - did a lot of the work myself. There is no use moving into a place and changing it immediately - you need to live in it for a year or so to find out the things you like and don't like about it in all seasons (something that drives you batty in winter might be perfect in summer).
When I had finished the front rooms (after about five years), I found an architect that I liked, and after three years of discussion, she gave me a renovation plan I liked for the back section that needed to be knocked down. I had saved up the money for the renovation, and already paid off the mortgage (I live in Australia where paying off the mortgage aggressively is about the best thing you can do with your money). For a few years I had a border - but that wasn't for long. It helped.
This was a high col area in a high col city. I don't live there any more, as I moved for health reasons, but although that house is a two bedroom wooden house, it is currently worth $1.5mill. Before I left, I was FI, although I didn't realise this for a few more years. I had become FI using the MMM formula, as a single person on a single wage. If I had known I could retire early, I would definitely have been able to do it in 10 years. I took no risks. I always lived on a very small portion of my wages. I've read a number of articles, and there was an interesting one from our stock exchange, comparing gains people made with and without gearing. Gearing made about 5% difference in the amount they had at the end - it really doesn't seem worth the risk!
When I moved, I bought my current house without a mortgage, with the money from the first one. It was slightly cheaper. It is now worth a lot less than the first house (that city's prices have increased much more than the prices in my current city), but that doesn't matter, because a house is just where you live - it's not part of your retirement stash. Although houses where I now live are somewhat cheaper than in the suburb of the first house, prices overall here are similar (because it was in an expensive part of the city), and the cost of living is actually higher. I have been retired for 7 years.