Author Topic: Multi-million dollar second homes  (Read 3646 times)

FINate

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Multi-million dollar second homes
« on: March 11, 2016, 12:20:04 AM »
http://www.santacruzsentinel.com/business/20160310/carmel-among-popular-sites-for-affluent-seeking-getaways-from-silicon-valley

Stressed at work in your high paced tech job? Harried lifestyle? Looking to "unplug" and get away to spend quality time with loved ones? Then you too can spend $3.6 million to $11.8 million on a vacation home. Just 2 hours from Silicon Valley, you can start your weekend off right by fighting terrible traffic to get to your personal oasis. Once there you can read and send emails in total tranquility and then fight traffic on your return home in two days. Property taxes will only run you in the neighborhood of $36,000 to $118,000 per annum.

/sarcasm

Ok, so there's a part of me that thinks "hey, if I had the money that looks nice!" But then again, the people they interview still work and seem to be looking for a way to deal with the pressures of daily life. Why not sell the vacation home, avoid the additional taxes, and maybe move to a slightly less expensive part of the Bay Area (Menlo Park and Atherton are crazy expensive) and then work less or not at all? 4%, on say $5 million invested, that's $200,000 a year.

I'm sure it's nice and I would enjoy it at first, but I know the novelty would quickly wear off and it would become mundane. I would then feel like I was paying a ton just to maintain something I don't really enjoy. For my money I would rather go camping or backpacking in the back country - now that's unplugging!

Or perhaps I'm too middle class in my outlook at the whole point is to join an elite club and be surrounded by other elites? Just trying to figure out what the allure is.

MgoSam

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Re: Multi-million dollar second homes
« Reply #1 on: March 11, 2016, 04:03:52 AM »
Good point, when I read about expensive second homes I think, 'Good for them if they have the money,' but yeah you're right, it goes back to the vicious style of

A. Working hard to make money
B. Stress out about your hard work
C. Spend money to relieve stress
D. Realize that you need to work harder now to pay off bills
E. Work hard to make money.

zephyr911

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Re: Multi-million dollar second homes
« Reply #2 on: March 11, 2016, 05:51:47 AM »
Good point, when I read about expensive second homes I think, 'Good for them if they have the money,' but yeah you're right, it goes back to the vicious style of

A. Working hard to make money
B. Stress out about your hard work
C. Spend money to relieve stress
D. Realize that you need to work harder now to pay off bills
E. Work hard to make money.

...and that's why they call it a treadmill. The good thing is, once you realize the nature of the thing, it's generally quite simple to briefly grasp the rails and step off.

HairyUpperLip

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Re: Multi-million dollar second homes
« Reply #3 on: March 11, 2016, 07:38:06 AM »
Good point, when I read about expensive second homes I think, 'Good for them if they have the money,' but yeah you're right, it goes back to the vicious style of

A. Working hard to make money
B. Stress out about your hard work
C. Spend money to relieve stress
D. Realize that you need to work harder now to pay off bills
E. Work hard to make money.

F. Complain to everyone about how you can't afford to retire.

Roboturner

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Re: Multi-million dollar second homes
« Reply #4 on: March 11, 2016, 08:29:43 AM »
Good point, when I read about expensive second homes I think, 'Good for them if they have the money,' but yeah you're right, it goes back to the vicious style of

A. Working hard to make money
B. Stress out about your hard work
C. Spend money to relieve stress
D. Realize that you need to work harder now to pay off bills
E. Work hard to make money.

F. Complain to everyone about how you can't afford to retire. (in perpetuity)

fixed it

Felicity

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Re: Multi-million dollar second homes
« Reply #5 on: March 11, 2016, 08:33:45 AM »
Oh man, the property taxes alone make me cringe...

Recurring expenses somehow shock me more than outrageous sticker prices. O.o

Good point, when I read about expensive second homes I think, 'Good for them if they have the money,' but yeah you're right, it goes back to the vicious style of

A. Working hard to make money
B. Stress out about your hard work
C. Spend money to relieve stress
D. Realize that you need to work harder now to pay off bills
E. Work hard to make money.

F. Complain to everyone about how you can't afford to retire. (in perpetuity)

fixed it

And we're the crazy ones! XD

FINate

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Re: Multi-million dollar second homes
« Reply #6 on: March 11, 2016, 10:10:36 AM »
And we're the crazy ones! XD

To be fair, some of these people can probably truly afford it. As in, paid for with cash and plenty of other investments. Crazy to think about, but this does happen in Silicon Valley. And I suppose some may really enjoy their work, even if stressful.

Still, no matter how I adjust the variables I can't make the equation work for me. If you have that kind of money, why keep working? There are simply too many other things in this world that are more meaningful than making gobs of money. I could understand for a charity or hospital or something, but most tech companies vastly overestimate their contribution to the world...I think I just answered my own question :)

Chris22

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Re: Multi-million dollar second homes
« Reply #7 on: March 11, 2016, 11:04:10 AM »
And we're the crazy ones! XD

To be fair, some of these people can probably truly afford it. As in, paid for with cash and plenty of other investments. Crazy to think about, but this does happen in Silicon Valley. And I suppose some may really enjoy their work, even if stressful.

Still, no matter how I adjust the variables I can't make the equation work for me. If you have that kind of money, why keep working? There are simply too many other things in this world that are more meaningful than making gobs of money. I could understand for a charity or hospital or something, but most tech companies vastly overestimate their contribution to the world...I think I just answered my own question :)

Because they're not really working:

"Ginger Martin, a Sotheby's agent based in the Napa Valley, would agree: "I have made my living on second and third and fourth-home buyers," she said. "That's my clientele. I'm dealing with the private equity and VC guys who fund the companies.""

They're basically active investors, like Buffet, these aren't guys punching a clock or worried about taking that 10PM call with Asia.

Abe

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Re: Multi-million dollar second homes
« Reply #8 on: March 11, 2016, 11:48:49 AM »
http://www.santacruzsentinel.com/business/20160310/carmel-among-popular-sites-for-affluent-seeking-getaways-from-silicon-valley

Or perhaps I'm too middle class in my outlook at the whole point is to join an elite club and be surrounded by other elites? Just trying to figure out what the allure is.

This. Come on, they can't do stuff that anyone can afford! That'd be so proletariat.

I think an alternate, more financially reasonable strategy that could be physically and mentally rewarding is purchasing some un-developed land and building a small cabin on it. It'll give one something to do with their free time, and you get a house at the end.

FINate

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Re: Multi-million dollar second homes
« Reply #9 on: March 11, 2016, 12:10:55 PM »
Because they're not really working:

"Ginger Martin, a Sotheby's agent based in the Napa Valley, would agree: "I have made my living on second and third and fourth-home buyers," she said. "That's my clientele. I'm dealing with the private equity and VC guys who fund the companies.""

They're basically active investors, like Buffet, these aren't guys punching a clock or worried about taking that 10PM call with Asia.

Elsewhere in the article it paints most of them, with the exception of the semi-retired guy, as very busy hence the desire to get away and unplug. Although I suppose they could just represent their lives that way to seem important, like they've really earned it...

FINate

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Re: Multi-million dollar second homes
« Reply #10 on: March 11, 2016, 12:18:37 PM »
I think an alternate, more financially reasonable strategy that could be physically and mentally rewarding is purchasing some un-developed land and building a small cabin on it. It'll give one something to do with their free time, and you get a house at the end.

Now you're talking, that would be way more interesting to me. Even something as simple as a Forest Service cabin would be more interesting, and way cheaper.