ALMOST 20 YEARS AGO, we renovated our entire Washington, DC, home. The memory is still quite fresh. If you’ve ever renovated a house, you’ll understand.
A home renovation has similarities to personal finance: You can do it yourself (DIY), you can pay someone to do it for you, or you can do something in between. This last approach has worked well for me—both with renovations and financial matters.
Our home consisted of a three-level townhouse.
THERE ARE A GREAT many terrible problems. Having too much cash typically isn’t seen as one of them. Yet that’s where we are. Following our move back to the U.S. from Spain, we found ourselves with an abundance of cash sitting in our brokerage account. And these days, with interest rates the way they are, that cash doesn’t do much more than sit.
The upshot: We decided to purchase some rental properties. We have one rental unit already—our former home—but we plan to make it our home once again.
STOP LUSTING AFTER homes on Zillow. It’s time to get serious about the property market—and ask whether houses today are a good value.
Make no mistake: Real estate is red hot. Bloomberg recently reported that demand is so strong that almost half of U.S. homes sell within a week of coming to market. The S&P Case-Shiller U.S. National Home Price Index surged 12% over the 12 months through February, with the Phoenix and San Diego markets leading the way with 17% gains.
MANY DREAM of retiring to the beach. My wife and I just did it. We recently sold our primary home outside Philadelphia and moved to our vacation home on the New Jersey Shore. The decision wasn’t easy. It was the result of a number of events coming together, including the pandemic, the hot real estate market and an attractive, but unexpected offer on our primary home.
We’d lived in our old home since 1994.
MUCH IS WRITTEN about whether it’s better to rent or own your home. Not nearly enough ink is devoted to the issue of renting from a bad landlord.
Perhaps personal finance writers avoid the topic because they’re wary of providing legal advice when discussing potential remedies. On top of that, landlord-tenant law varies greatly from state to state, with some states offering greater protection to tenants and others affording landlords wider latitude.
I know a fair amount about this because I not only spent 14 years as an active-duty Army servicemember who had to move frequently,
FULL DISCLOSURE: I am the antithesis of the DIY guy. I was completely banned from home repairs many years ago after I set out to replace an electrical outlet—but switched off the wrong circuit breaker before doing so.
We’ve undertaken two major renovations in the past 12 years. The first was an addition to our vacation home. The second is ongoing—a new kitchen at the same house.
We spent months on the plans. In the case of the addition,
IN MY EARLY 30s, I was a typical blue-collar worker. The only way I invested was through my employer’s 401(k) plan. But I was a good saver, putting 25% of my income into the plan, which was the maximum allowed, plus I got a generous company match of 8%. Still, I was on the lookout for ways to increase my savings and my investment returns. That was early 2006.
I read a variety of books to further my personal finance knowledge.
THERE’S SOMETHING very emotional about our homes—and how we think about their value. Take the conversation my wife and I had a couple of weeks ago.
“Did you see the house behind us went up for sale this week? They have it listed at 141% more than what we paid for our house.”
“Well, there’s no way their house is worth that much.”
“Oh really? I just talked to our neighbor—the one who’s a realtor—and he said they had five offers the first day it went up.
MY FATHER WAS A CAR salesman who, for many years, worked totally on commission, with no paid vacation. In 1953, when I was 10 years old, we went to Cape Cod for a week. A friend gave him a tip on a great place to stay. In his enthusiasm, my father booked for a week and paid in advance.
The place turned out to be worse than a Second World War army barracks. My mother refused to stay.
MY SON AND HIS fiancée recently purchased their first home. They’ve asked me about things like how to fix a leaky faucet, but they haven’t asked me for financial advice—which is a good thing, because I’ve had very limited experience buying houses.
You see, my wife and I bought our first and only home in 1986. We paid $89,000, putting down $20,000 and taking out a $72,000 mortgage by the time we added in points,
AH, A SECOND HOME—a fond dream for so many. While we try to justify a weekend house as a “good investment,” they’re often bought to fulfill some emotional need.
For some, it’s a beach house. For others, it’s a mountain getaway. But for me, it’s always been a place in the country. I’m an introvert. The prospect of getting away from crowds and noise to a secluded place of peace and quiet is my ideal.
WHEN OPPORTUNITY knocks, will you be ready? In the past 15 months, my wife and I have had two attractive but completely unexpected opportunities presented to us.
On Labor Day 2019, a neighbor at our New Jersey Shore house told us they were selling their home. They had bought a lot nearby and were planning to build a larger house to accommodate their growing brood of grandchildren. They knew my wife and I had a third grandson on the way,
I GREW UP IN a small apartment. Truth be told, I was never enthusiastic about maintaining a house, but I did so for 45 years. Eight years after I retired in 2010, the house and its stairs became too much for my wife and me.
We considered moving to a smaller one-story house and briefly flirted with a continuing care community. We even looked at one community and found it too expensive, especially having to hand over a partially refundable $900,000 upfront fee,
A FEW YEARS AGO, my future husband and I took a trip to southern Utah to participate in a pistol shooting competition. We were taken by the area’s beauty and easy access to outdoor recreational activities. While there, we looked at a few homes and were pleasantly surprised to find the prices quite reasonable. We decided Utah would be high on our list of places to relocate to once I retired from my job.
MY WIFE AND I decided at the end of 2016 to sell our house. Selling a home is the biggest transaction most of us will ever make, and yet—in my experience—almost all home sellers spend too little time trying to find the right real estate agent.
Folks might interview two agents at most and many interview none at all, instead hiring based on a friend’s recommendation. I realized there must be a better way.