Investing megathread extravaganza

[DaFace]

A place to talk about investing stuff.

[Bill Brasky]

Is this thread only for stocks? I just learned I’m getting ridiculous commission this year and the wife and I are looking at real estate. I’m thinking a 2 bed 1.75 bath condo and classifying it as a second home.

[DaFace]

Originally Posted by Bill Brasky

Is this thread only for stocks? I just learned I’m getting ridiculous commission this year and the wife and I are looking at real estate. I’m thinking a 2 bed 1.75 bath condo and classifying it as a second home.

I don't think there's any formal boundaries on the thread. Similar to you, my wife and I are toying with the idea of buying a cabin in the woods. We could technically afford it, but there wouldn't be a ton of wiggle room (beyond our normal savings, investments, and other spending), so I'm guessing we'll end up holding off for now. That said, we're still just in our late 30s, so hopefully we can save a little more to do it in the near-ish future.

I do find it challenging to figure out how to view it in terms of an "investment." On the one hand, most of my net worth today can be attributed to appreciation on my house, but on the other, it's impossible to know how things will shift in the future. In addition, there are a ton of other costs to consider (taxes, utilities, HOA fees, etc.) that are a pretty significant drag on the amount you can expect to make off of it.

In short, I have no answers, but if you come up with any brilliant ways of thinking about it, let me know.

[scho63]

Originally Posted by DaFace

That said, we're still just in our late 30s.

Always thought you were late 40s early 50s. Not sure why.

[Bill Brasky]

Originally Posted by DaFace

I don't think there's any formal boundaries on the thread. Similar to you, my wife and I are toying with the idea of buying a cabin in the woods. We could technically afford it, but there wouldn't be a ton of wiggle room (beyond our normal savings, investments, and other spending), so I'm guessing we'll end up holding off for now. That said, we're still just in our late 30s, so hopefully we can save a little more to do it in the near-ish future.

I do find it challenging to figure out how to view it in terms of an "investment." On the one hand, most of my net worth today can be attributed to appreciation on my house, but on the other, it's impossible to know how things will shift in the future. In addition, there are a ton of other costs to consider (taxes, utilities, HOA fees, etc.) that are a pretty significant drag on the amount you can expect to make off of it.

In short, I have no answers, but if you come up with any brilliant ways of thinking about it, let me know.

We’ve been looking on Redfin but the HOA dues on a condo are insane. They can be upwards of $500/ month on top of the mortgage. We’re looking in Seattle, so the competition is fierce. I love the cabin in the woods idea. We toyed with getting a vacation style property but the appreciation just isn’t the same.

We’re in the same position where our net worth is all in our house but it’s appreciating at 40% yoy. It’s the best investment around.

[lewdog]

Originally Posted by DaFace

I don't think there's any formal boundaries on the thread. Similar to you, my wife and I are toying with the idea of buying a cabin in the woods. We could technically afford it, but there wouldn't be a ton of wiggle room (beyond our normal savings, investments, and other spending), so I'm guessing we'll end up holding off for now. That said, we're still just in our late 30s, so hopefully we can save a little more to do it in the near-ish future.

I do find it challenging to figure out how to view it in terms of an "investment." On the one hand, most of my net worth today can be attributed to appreciation on my house, but on the other, it's impossible to know how things will shift in the future. In addition, there are a ton of other costs to consider (taxes, utilities, HOA fees, etc.) that are a pretty significant drag on the amount you can expect to make off of it.

In short, I have no answers, but if you come up with any brilliant ways of thinking about it, let me know.

I guessed late 40's on you too.

But you're very smart and knowledgeable. Nothing is off boundaries in this thread if it involves money.

[scho63]

Originally Posted by lewdog

I guessed late 40's on you too.

But you're very smart and knowledgeable. Nothing is off boundaries in this thread if it involves money.

Not my reason, I just think he's old and grumpy like the rest of us old farts on here!

[Buehler445]

Originally Posted by scho63

Always thought you were late 40s early 50s. Not sure why.

**** that. He's a year older than me and I'm not that goddamned old!

[Bearcat]

Originally Posted by DaFace

I don't think there's any formal boundaries on the thread. Similar to you, my wife and I are toying with the idea of buying a cabin in the woods. We could technically afford it, but there wouldn't be a ton of wiggle room (beyond our normal savings, investments, and other spending), so I'm guessing we'll end up holding off for now. That said, we're still just in our late 30s, so hopefully we can save a little more to do it in the near-ish future.

I do find it challenging to figure out how to view it in terms of an "investment." On the one hand, most of my net worth today can be attributed to appreciation on my house, but on the other, it's impossible to know how things will shift in the future. In addition, there are a ton of other costs to consider (taxes, utilities, HOA fees, etc.) that are a pretty significant drag on the amount you can expect to make off of it.

In short, I have no answers, but if you come up with any brilliant ways of thinking about it, let me know.

I know someone trying to sell a cabin in Grand Mesa (about 90 minutes outside of Grand Junction), which sucks in that there's a lot of family history tied into it, and I'd love to buy it if it wasn't so far away.... then I heard they're looking for something like $300k.

I'm sure (or certainly hope) there are cheaper cabins out there, but I'd feel like I have to be there every weekend... except there are the costs and time involved with each trip, too.

But, I'm still in tent camping mode and haven't started down the path of RV/toy hauler/truck to tow it all/cabin in the woods... there's a flow chart.

[Buehler445]

Originally Posted by Bill Brasky

We’ve been looking on Redfin but the HOA dues on a condo are insane. They can be upwards of $500/ month on top of the mortgage. We’re looking in Seattle, so the competition is fierce. I love the cabin in the woods idea. We toyed with getting a vacation style property but the appreciation just isn’t the same.

We’re in the same position where our net worth is all in our house but it’s appreciating at 40% yoy. It’s the best investment around.

WTF? 40%?????

Yeah, that's not sustainable. And you certainly shouldn't expect anything like that kind of a return on an investment property. That's an absurd return.

In terms of finding RE particularly homes, as investment vehicles, there are a lot of other things to consider.

Debt service is obvious, but cash flow needs to be considered too. There is the monthly shit, but it really sucks when the air conditioner or water heater shits the bed or whatever else. That really puts a cramp on stuff.

I'm not sure what you can secure for financing, but interest rate risk is a concern.

Historically the way to make money on Real Estate was through rental, which you pretty much have to treat like a business. That's the way I'd approach this if you're looking to find a return.

If you're looking for a vacation home, I'd treat it like a vacation, not an investment.

Just my $.02.

[Buehler445]

Originally Posted by Bearcat

I know someone trying to sell a cabin in Grand Mesa (about 90 minutes outside of Grand Junction), which sucks in that there's a lot of family history tied into it, and I'd love to buy it if it wasn't so far away.... then I heard they're looking for something like $300k.

I'm sure (or certainly hope) there are cheaper cabins out there, but I'd feel like I have to be there every weekend... except there are the costs and time involved with each trip, too.

But, I'm still in tent camping mode and haven't started down the path of RV/toy hauler/truck to tow it all/cabin in the woods... there's a flow chart.

I'm still stuck on work your ass off protocol in the flow chart.

I have a cousin that has a cabin outside Colorado Springs. I can't imagine it's worth 300K.

I'm skipping the RV phase. It's just not happening. I even have a diesel pickup. There's just a culture there I'm not into.

[Jimmya]

Quick question for you guys as we have 5 children. How many of you paid or helped pay for your kids college?

[Rain Man]

Originally Posted by Jimmya

Quick question for you guys as we have 5 children. How many of you paid or helped pay for your kids college?

I don't have kids, but I can confirm that my parents said I was on my own for college. And they kept that promise down to the penny.

[Rain Man]

My wife and I went through a spell of wanting a cabin. It still seems like a good concept. But I just can't make the math work in terms of my time and effort and maintenance. You'd have to want to be a remote landlord for most of the year. And if you use it enough that you aren't the remote landlord, then you're just paying for two houses. Maybe that can work if you're in a rapidly appreciating area, but it just seems way easier to put it in stocks.

I might halfway be able to justify it if I was retired, but I think I just might like a bigger house where I'm not always worried what's going on in the vacant one.

[Peter Gibbons]

Originally Posted by Jimmya

Quick question for you guys as we have 5 children. How many of you paid or helped pay for your kids college?

We did pay for both my daughters undergrad expenses and her graduate medical school as well. While we were fortunate enough to be able to pay for these expenses ourselves and not have to ask her to contribute, the equation would have likely changed if we had five kids were putting through school versus one.

That being said, we did set limits. We told my daughter we would pay for her undergrad to anywhere she wanted to go. However, if she chose a public university where costs were lower, we would also pay for grad/med school. In hindsight, giving her some skin in the game to choose wisely and do well while in school probably was our best decision.

[lewdog]

Originally Posted by Jimmya

Quick question for you guys as we have 5 children. How many of you paid or helped pay for your kids college?

My grandmother paid for my undergrad. My parents paid for my graduate degree, so I wouldn't have to take a loan, but we agreed I would pay them the entire amount back. This still saved me money since it was an interest free loan but also made me want to find a good paying job right away to start paying them back.

After I paid my parent's back $30k, they nicely told me the rest of my loan (another $30k) was forgiven.