Author Topic: Am I monster?  (Read 5344 times)

HAL9000

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Am I monster?
« on: June 22, 2017, 12:07:22 PM »
We own a couple of luxury 2br 2ba condo's in the same complex and a SFH, of which we are living in. The SFH is a 4br 2BA that needs a significant amount of work to bring it up to current standards, last remodeled in late 70's. Not looking forward to the cost and work to bring it up to spec, looking at real estate cycle and we are at/near a peak and being about to drop the cost/work and cash out at a good price.

I have a family of 5. Wife and I and 3 kids, 7,9,16.

I am considering moving out of this SFH and using it to pay off the 2 condos and having my family move into one or both of the condo's. My wife thinks it's a bizarre idea. I am looking at it from the perspective of the amount of money we would be able to have available per month at that point would be significant. The available funds would then accelerate our journey to FIRE.

Am I a monster for considering putting my family of 5 into a 2br 2ba condo?
« Last Edit: June 22, 2017, 12:10:54 PM by HAL9000 »

Kwill

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Re: Am I monster?
« Reply #1 on: June 22, 2017, 12:11:46 PM »
It sounds unnecessarily difficult. Could you sell all three properties and buy one that fit your family nicely and didn't need much work?

Watchmaker

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Re: Am I monster?
« Reply #2 on: June 22, 2017, 12:17:14 PM »
Sure, you and your wife can take one condo and the 7,9, and 16 year old can take the other one.

Or you could take Kwill's advice.

HAL9000

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Re: Am I monster?
« Reply #3 on: June 22, 2017, 12:19:11 PM »
We are thinking about that, but buying a new property at the peak pricing isn't appealing. The thought is to downsize at the peak, wait and bank until the next down cycle then buy another property at a discount. Obviously the timing is a total unknown...

Dezrah

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Re: Am I monster?
« Reply #4 on: June 22, 2017, 12:29:16 PM »
Tricky.  If you're kids were younger and closer in age, I'd say go for it, but asking a 16 year old to suddenly share with their 7 year old sibling, not an amazing idea.  Maybe if the kids all REALLY like each other, never ever fight, never get hormonal, never crave privacy, etc.  You know your family better than we do.

Perhaps you could revisit when the oldest moves out in a couple years.  This may or may not work with the real estate cycle, but I suspect you'd have greater peace at home.

RyanAtTanagra

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Re: Am I monster?
« Reply #5 on: June 22, 2017, 12:49:25 PM »
We are thinking about that, but buying a new property at the peak pricing isn't appealing. The thought is to downsize at the peak, wait and bank until the next down cycle then buy another property at a discount. Obviously the timing is a total unknown...

But you'd be selling 3 properties and buying one at the peak.  If you sell and buy at the same time, it doesn't matter if it's the bottom or top of the market.  It's all a wash.

researcher1

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Re: Am I monster?
« Reply #6 on: June 22, 2017, 01:09:43 PM »
The thought is to downsize at the peak, wait and bank until the next down cycle then buy another property at a discount. Obviously the timing is a total unknown...
This sounds comparable to timing the stock market.

How are you able to determine the real estate peaks and bottoms? What sources are you using?
If these sources are so accurate, then why isn't everyone buying low and selling high?

As another poster said, what is the issue with SELLING THREE HOUSES at the supposed peak and buying one?
You have to live somewhere.  You can't sell at the peak and "wait until the next down cycle" to buy something else, unless you plan to rent during the interim.

Besides, you have a family of 5. 
How much is it worth to provide your family with a stable, comfortable, familiar environment to live and grow up in?
Selling a house, moving all of your belongings into a 2 BR condo, then selling and moving again and again with real estate cycles, doesn't sound worthwhile to me.

lbmustache

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Re: Am I monster?
« Reply #7 on: June 22, 2017, 01:31:30 PM »
Doable, but really you're looking at:

2 condos: so either you and your wife live separate most of the time, or your kids get a whole condo to themselves most of the time?
1 condo: 3 kids share one room (sounds terrible), or you split the kids between the 2 bedrooms, and you and wife convert part of the living room into a makeshift bedroom for yourselves (i.e. sofa bed, daybed or similar)?

BFGirl

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Re: Am I monster?
« Reply #8 on: June 22, 2017, 02:42:44 PM »
This sounds like it could cause a lot of stress for the family. 

Vindicated

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Re: Am I monster?
« Reply #9 on: June 22, 2017, 02:58:06 PM »
Splitting between 2 condos would not be ideal, and sharing 1 isn't ideal. 

As lbmustache said, you could stay in the living room and let the kids split the rooms.  If your wife is cool with that, go for it.  My wife wouldn't be, although I'd love that savings.

Scortius

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Re: Am I monster?
« Reply #10 on: June 22, 2017, 03:03:53 PM »
Woah, I think we need to question the whole premise of this post before we go further.  This whole dilemma is based on the idea of market cycles and 'being at a housing peak'.  That's a huge assumption that you're making.  Don't time the market!  Especially so for your primary residence.

Look, just make it simple and don't even think of your primary residence as an investment.  If you're going to live in a house for a while and the rent vs. buy calculator says buy, then buy a house that fits your budget and needs.  Otherwise rent.  If you move during a market 'peak', then you buy high, but you sell high too.  If you move during a market 'trough', you sell low but you buy low too.  Either way it washes out and the value of your housing asset simply follows the long-term housing market.

Don't try and time the market.  Especially don't try and time the market when dealing with your primary residence.

Do you feel like the current state of the house is so bad that you can't continue living there as it is now?  Otherwise, why do anything at all?  If the house needs to be remodeled, why not just rent a house for a year if you need to move out?  Or, sure, just buy another house and do what you need to do with the old one.

You are way over-thinking this and making certain assumptions regarding the housing market that you don't have the knowledge or expertise to make.

acroy

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Re: Am I monster?
« Reply #11 on: June 22, 2017, 03:21:07 PM »
No you are a fictional Arthur C. Clarke character.

Sounds more or less reasonable to me, if the fam is up for it.
good luck!

Dee18

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Re: Am I monster?
« Reply #12 on: June 22, 2017, 03:25:00 PM »
I'm shocked that I'm the only person so far who thinks this is reasonable, especially if you think the 16 year old will move to a dorm for college.  Many families with 3 kids live in 2 bedroom homes, and you would have the luxury of the second bath.  But it would be a big change.   The bottom line is: if your wife is opposed to the idea, it's probably not a good choice for your family.

Pigeon

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Re: Am I monster?
« Reply #13 on: June 22, 2017, 06:17:02 PM »
If your wife isn't on board with it, she isn't.  Presumably her name is on all these deeds, too?  I wouldn't want to live that way either.

Molzy

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Re: Am I monster?
« Reply #14 on: June 22, 2017, 09:19:21 PM »
Could you sell the two condos and use the profits to finance the renovation?

Guide2003

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Re: Am I monster?
« Reply #15 on: June 22, 2017, 10:07:12 PM »
But you'd be selling 3 properties and buying one at the peak.  If you sell and buy at the same time, it doesn't matter if it's the bottom or top of the market.  It's all a wash.
Sell three properties at the peak, rent for two years, and buy at the low, whenever you think that will be. Spend the extra time you save from housework with your kids.

MayDay

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Re: Am I monster?
« Reply #16 on: June 23, 2017, 05:03:16 AM »
Selling all three and downsizing makes sense, but IMO with there kids you should go for a small 3 bedroom place.

Scortius

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Re: Am I monster?
« Reply #17 on: June 23, 2017, 10:13:57 AM »
But you'd be selling 3 properties and buying one at the peak.  If you sell and buy at the same time, it doesn't matter if it's the bottom or top of the market.  It's all a wash.
Sell three properties at the peak, rent for two years, and buy at the low, whenever you think that will be. Spend the extra time you save from housework with your kids.
If we knew when the peaks and the lows would occur, we'd all be rich...

It sounds so simple when it's just stated "I don't want to buy at current peak", but that whole statement is total hogwash.

Guide2003

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Re: Am I monster?
« Reply #18 on: June 23, 2017, 10:51:44 AM »
If we knew when the peaks and the lows would occur, we'd all be rich...
Agreed. I think the premise of this question, namely having three residential units that don't meet your own needs, but not flipping them or renting them out indicates a need need to change strategies. Maybe real estate isn't the best spot for his money, and the longer his money is there, the later he is into the market.

partgypsy

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Re: Am I monster?
« Reply #19 on: June 23, 2017, 11:29:02 AM »
Sell the condos. Use (part) of the cash to fix up the main house enough to sell it for good profit. Sell that and buy a 3,4 bedroom home that requires less upkeep or less money to maintain. Unless your wife and your kids love that house and don't want to move. In that case wait till kids are grown up to downsize.

meandmyfamily

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Re: Am I monster?
« Reply #20 on: June 23, 2017, 12:11:24 PM »
It sounds fine to me but ONLY if your wife is on board.  We have 4 kids and I would do it if the numbers were right.

the_fixer

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Re: Am I monster?
« Reply #21 on: June 25, 2017, 06:02:56 PM »
If someone is in tune with the local housing market I do not think it is unrealistic to see trends coming and be able to buy or sell depending on the trends. Housing is not as volatile as the stock market and the swings are typically much slower than stocks so the comparison to stock market timing is not a fair one in my opinion.