[MNViking]

Originally Posted by Fastskiguy

We owned a home here for 6 years before getting down here full time and this ^^^ is a thing. Plus managing it from a distance is a pain in the neck. Like when the neighbor (fortunately) calls and says one of your sprinkler heads is broken and you have a fountain in your back yard. You do end up with a home to move into that's closer to businesses vs. being new in the middle of nowhere....but nowhere becomes somewhere in a few years and you get to move in with all of your new neighbors at the same time and it's like going off to college but more fun. So I say....just wait and make the move all at once. YMMV!

Joe

Joe, thanks for that insight. Question, knowing the pains that you mentioned, are you saying you would not have done the same thing again?

You would have waited the 6 years?
What would you have done in the meantime?

Looking back, what would have to wait the 6 years gotten you in terms of improvements, cost of homes, locations or is it simply just less headaches? (Which I am not discounting, as it is a pain in the but having another place, but you knew that going into it.). The Sprinkler head is a problem, hope the neighbor helped and was neighborly!

[thelegges]

Originally Posted by MNViking

Joe, thanks for that insight. Question, knowing the pains that you mentioned, are you saying you would not have done the same thing again?

You would have waited the 6 years?
What would you have done in the meantime?

Looking back, what would have to wait the 6 years gotten you in terms of improvements, cost of homes, locations or is it simply just less headaches? (Which I am not discounting, as it is a pain in the but having another place, but you knew that going into it.). The Sprinkler head is a problem, hope the neighbor helped and was neighborly!

We had homes in TV from 2010 to 2018 before one came down seasonal (4month) we hired a great home watch (retired LEO) if there was a problem it was taken care immediately. You will find some just have difficulty dealing with problems on the home they live in.

. Many like us have zero issues managing long distance. Finding great tenants, having a great home watch is the key. We only rented long term so no empty house, no furniture, no WiFi, TV, electric or gas bills. If we came to visit we either rented for a few weeks, or stayed in one of other TV homes

We always take the largest mortgage amount, with the smallest down (no points). Then after 60 days paid 50% principal payment. That 6-7% interest money drops in half. Leaving enough interest for the rental write off. Our financial guy alway guided us on how much principal to pay, still keeping liquid money for an issue, yet dropping those high interest amounts to our benefit

Some just can’t have debt, and would rather be cash poor, and no mortgage. Our investments always have made more money than any interest payment

[MNViking]

Originally Posted by thelegges

We always take the largest mortgage amount, with the smallest down (no points). Then after 60 days paid 50% principal payment. That 6-7% interest money drops in half. Leaving enough interest for the rental write off. Our financial guy alway guided us on how much principal to pay, still keeping liquid money for an issue, yet dropping those high interest amounts to our benefit

Some just can’t have debt, and would rather be cash poor, and no mortgage. Our investments always have made more money than any interest payment

That is interesting to me, I need to learn more about this, as I have not heard of this but kinda the information I am seeking outside of the norm. Items I don't know, I didn't even know about lol!

So example, correct me if I'm am wrong. Just using the 300K number.

You put enough down, assuming to not pay PMI. So 20% down you paid $60k

$300,000
-$60,000
----------------
$240K (Give or take closing etc rolled in)

Then 60 days later, you dropped $120k into an early payment (should hit principal), then maintain the same monthly payments, but your saving interest dollars and overall dollars based on less interest being accrued on principal. Do I have that correct? (Monthly spending is higher due to monthly mortgage, but savings come from long-term interest accrual being decreased.)

Is my rudimentary response correct? I also cannot take the interest off of the mortgage as it is a second home for tax purposes. I read the fed taxes and it states you can, but didn't dive in totally on the tax rules as there was a maybe in there.

I would only offer it up just to have someone in there on days not there, not necessarily for income. However, it never hurts to have someone pay towards your mortgage in your absence.

[Normal]

Right now all inventory rates are climbing, the repercussions are lower home prices and continued price cutting. There isn’t a slow down yet on the increasing inventory but it certainly is easy to find out when we plateau. Just keep checking the MLS total numbers, or Zillow or one of many other sites. Why buy high, jut monitor the situation if you are looking to invest.

Right now just Zillow and VLS have more than 1400 preowned homes for sale. If the number keeps climbing, your purchase price will potentially always be lower. Save the money you have and put in Fidelity or whatever. Get your 12% a year and buy your dream home when it’s time to retire.

There is Zero Urgency for purchases and investing.

[jimjamuser]

Be aware that the summers are HOT and with Climate Change they are getting hotter. As you age HEAT is harder to deal with. So, The Villages is great for about 8 months out of the year, but it is NOT so good for full time residents. If you plan on living in only ONE home then, I would suggest further north like South or North Carolina. Good Luck.

[CoachKandSportsguy]

Originally Posted by MNViking

That is interesting to me, I need to learn more about this, as I have not heard of this but kinda the information I am seeking outside of the norm. Items I don't know, I didn't even know about lol!

So example, correct me if I'm am wrong. Just using the 300K number.

You put enough down, assuming to not pay PMI. So 20% down you paid $60k

$300,000
-$60,000
----------------
$240K (Give or take closing etc rolled in)

Then 60 days later, you dropped $120k into an early payment (should hit principal), then maintain the same monthly payments, but your saving interest dollars and overall dollars based on less interest being accrued on principal. Do I have that correct? (Monthly spending is higher due to monthly mortgage, but savings come from long-term interest accrual being decreased.)

Is my rudimentary response correct? I also cannot take the interest off of the mortgage as it is a second home for tax purposes. I read the fed taxes and it states you can, but didn't dive in totally on the tax rules as there was a maybe in there.

I would only offer it up just to have someone in there on days not there, not necessarily for income. However, it never hurts to have someone pay towards your mortgage in your absence.

Second home deductible expenses:
Tax Breaks for Second-Home Owners

So sounds like a bit of financial education is needed, to which I would recommend a CFP or at least a CPA for how the tax benefits work. book an hour with a CPA and ask him to explain how it works. $200 well spent. Also know what your break even days rented is. The reason for that is that there are vastly different rates depending upon the high season and the low season. So if you set rates, be sure that you calculate your days rented to break even, and for a year long, you know your break even point, versus the market rates. Again, that line item financial planning and market analysis goes along way to making a sound financial investment,

You can keep the house as a second home, rent it, pay taxes on the income, etc. however, you better be sure that you insure your house properly for renters.

There is the alternative putting the house into an LLC, which segregates the liability risks from personal to property only, at different levels of corporate ownership. If in a corporate structure, all expenses are deductible, and cash income is mostly shielded from taxes by deprecation deductibility, including all amenity fees, lawn care, CDD maintenance, etc.

If you furnish the house with a golf cart, know that florida does not limit liability to the driver, but includes the owner of the golf cart as well.

Note that a home watch will be key, as air conditioners break, stupid plastic push pull valves break, water connections leak, heavy wind driven rain will find all the cracks and enter the house, garage door codes get duplicated, and be sure to understand the guest pass process and the renter pass process.

Just approach your trip for education, and start with the assumption that your prior rental ownership experience doesn't apply.

good luck

[ElDiabloJoe]

Originally Posted by jimjamuser

Be aware that the summers are HOT and with Climate Change they are getting hotter. As you age HEAT is harder to deal with. So, The Villages is great for about 8 months out of the year, but it is NOT so good for full time residents. If you plan on living in only ONE home then, I would suggest further north like South or North Carolina. Good Luck.

[DrMack]

Originally Posted by MNViking

Good morning, I am seeking information from those who are more seasoned and experienced than myself in this area. Allow me to paint the scenario, and if interested I would value input, and thoughts or considerations I may have not looked into or even thought of.

Situation: Age 55, with a wife of 42. Looking to purchase in the Villages and do not want to spend more than $300k for a home down there. This would be a second home, and used as such, not sure of renting it out yet as the distance of caring for and who to watch over it may/may not be an issue. That being said, it will eventually be our retirement home, and visits until that time, or we are allowed to work from our current jobs and office down there. That is neither here nor there for the conversation. (Unless something is valuable I should know.)

I owe less than $105k on current home.
I have roughly $150K sitting fairly liquid to use on a purchase of the home down there to minimize the mortgage loan.

Questions and thoughts I am seeking are:

Should I pay off the current home, and not have the mortgage, and take out the full mortgage on the future retirement home and put at least 20% down to avoid PMI on that home?

Do I not pay off the current home, and then put $100k+ on the down payment on the future retirement home? Keeping roughly $40k+ in a money market for any boo-boos that may occur for a rainy day fund?

I am trying to ascertain the info to help make a better education decision for the finances, and since I am not in that industry, I don't know what I don't know. Therefore the questions may not be right?

Feel free to ask questions and I will check back and respond. What decisions did you all make, or what are the thoughts on what is best?

I appreciate the information?

I believe you have thoughts that you will earn money on a rental here in the Villages. I would hope so, but doubt it.

From our own personal experience we purchased a home a couple years ago in Dabney. I can tell you for certain we have lost money on the build. If we sold today, we might almost get 550 k or about what we paid for the home in early. 2023. The thing is we have since paid property taxes annually as well as all the other bills mentioned and have done some improvements. If we sold today we would lose all that and a real estate commission. Buying for profit is a fool’s errand.

[rjm1cc]

Originally Posted by MNViking

Good morning, I am seeking information from those who are more seasoned and experienced than myself in this area. Allow me to paint the scenario, and if interested I would value input, and thoughts or considerations I may have not looked into or even thought of.

Situation: Age 55, with a wife of 42. Looking to purchase in the Villages and do not want to spend more than $300k for a home down there. This would be a second home, and used as such, not sure of renting it out yet as the distance of caring for and who to watch over it may/may not be an issue. That being said, it will eventually be our retirement home, and visits until that time, or we are allowed to work from our current jobs and office down there. That is neither here nor there for the conversation. (Unless something is valuable I should know.)

I owe less than $105k on current home.
I have roughly $150K sitting fairly liquid to use on a purchase of the home down there to minimize the mortgage loan.

Questions and thoughts I am seeking are:

Should I pay off the current home, and not have the mortgage, and take out the full mortgage on the future retirement home and put at least 20% down to avoid PMI on that home?

Do I not pay off the current home, and then put $100k+ on the down payment on the future retirement home? Keeping roughly $40k+ in a money market for any boo-boos that may occur for a rainy day fund?

I am trying to ascertain the info to help make a better education decision for the finances, and since I am not in that industry, I don't know what I don't know. Therefore the questions may not be right?

Feel free to ask questions and I will check back and respond. What decisions did you all make, or what are the thoughts on what is best?

I appreciate the information?

Do you have enough money to retire? Sounds like you might be short on cash.
I would try renting for a season and postpone buying until you have lived in the Villages for a few months.

I would not have mortgages at this stage of life

[MNViking]

I have certainly been paying attention to those! Inventory absolutely keeps going up.

I am curious as to what is truly driving the inventory increases and number of houses going in the market. One report says homeowners are handcuffed and holding their homes as don't want to let go of their low mortgage rates for a higher one.

If that is the case, what are the circumstances driving people to put up their homes? I could go on with what they believe is happening, I just know in most locales it is certainly increasing exponentially, and a lot of divergent thoughts.

Inventory goes up because fewer people are buying and more people are holding.

Then another report shows more people putting up their places for sale and not holding.

Prices went up because of the market and low inventories, and although the prices are starting to lower, TV is maintaining some of the pricing... especially if you turn back the clock on these homes. Some of the homes I am looking at that were bought I am sure as an investment home, with what doesn't appear to be major upgrades show an increased ask of $75-$100k in the last 4 years. Those prices may/will not be met IMHO as that may get a deep hair cut.

[MNViking]

Originally Posted by DrMack

I believe you have thoughts that you will earn money on a rental here in the Villages. I would hope so, but doubt it.

From our own personal experience we purchased a home a couple years ago in Dabney. I can tell you for certain we have lost money on the build. If we sold today, we might almost get 550 k or about what we paid for the home in early. 2023. The thing is we have since paid property taxes annually as well as all the other bills mentioned and have done some improvements. If we sold today we would lose all that and a real estate commission. Buying for profit is a fool’s errand.

Nope, not in it to make rental money. Just to purchase a future retirement home, and potentially rent it if possible. If I don't or choose not to, totally ok with me. I will have started to build equity a little before retiring and my wife can take it over.

Can I ask where you saw that I was doing this for/as investment property? That threw me a bit...

[MNViking]

Originally Posted by rjm1cc

Do you have enough money to retire? Sounds like you might be short on cash.
I would try renting for a season and postpone buying until you have lived in the Villages for a few months.

I would not have mortgages at this stage of life

I appreciate that, but although I am 55, my wife is 42! Although I will be retiring, she will also still be making an income that will offset having both people living off of retirement income at least for 10+ years.

[CoachKandSportsguy]

Originally Posted by MNViking

I am curious as to what is truly driving the inventory increases and number of houses going in the market. One report says homeowners are handcuffed and holding their homes as don't want to let go of their low mortgage rates for a higher one.

If that is the case, what are the circumstances driving people to put up their homes? I could go on with what they believe is happening, I just know in most locales it is certainly increasing exponentially, and a lot of divergent thoughts.

Being a retirement community, see the number of obituaries on this site. Being a retirement community, there are a number of sales due to transitions to assisted living. Being a retirement community, there are constant downsizings based upon age. Being a retirement community, there is a constant turnover for all of the above reasons, including leaving to be closer to family.

So sometimes, the timing of the above events, isn't impacted by interest rates or low inventory, or any macro economic reasons for selling, but more about needing to turnover the property to get to the next stage of life. So there will be a continuous supply of houses to be sold all throughout the villages at what, 150 square miles or more?

So the job of a retirement home buyer is to know for what they are looking. Pool? outdoor kitchen? bedrooms for grandkids to visit? sauna? golf cart garage? which direction is the house facing? two car three car garages? Pantry needed? wine refrigerator? gas or electric appliances? on demand hot water or hot water tank? bond paid off? brand new, which model? furnishings, bringing your northern home to the tropics? wood floor or tile or carpet? type of countertop? granite, quartz, laminate? location may or may not make alot of difference, who cares what the resale value will be if its your home for 25 years. .

Then the hunting begins. . . no rush, you know what you want and the price range.

For a second home here, there is no rush for a good decision, but there are rushed poor decisions.

good luck, but there are LOTS of options

[Carlsondm]

You may want to budget more than $300,000 for your TV home. Prices are likely higher here than your home state. We came down five years ago planning to spend $250-300,000. I remember the expression on the realtors face. We ended up with a new two car plus golf cart home for $400,000 plus. We are not on the water and made our own view. Our closets are tiny and not rectangular and there are no basements, so we opted for a slightly larger home than we thought we needed. We are very happy we did.

[kingofbeer]

Originally Posted by CoachKandSportsguy

We rent out our house full time, for the last 5 years.
We have barely broken even on a cash flow basis, sheltered from income taxes with the non cash expenses
and that is without a mortgage. So there is one part of your due diligence, but that includes 20% property mgmt fee. If you do it yourself, which i don't recommend from far away, then you can make some money
BUT renting it out full time will not cover the expenses because the rental market is drying up with both the economy, and the expansive number of houses being built. more people are buying here and renting. rentals come mostly from people excaping winter or while looking for a house to buy. a very few come to live for 12 months, if you are very, very lucky

If you do the financial analysis correctly, you can easily rent for the amount of time you would be here,
for less money than buying a home. . . . many, many articles on that in financial publications.

and with renting, you actually get two pieces of information you don't have now:
1) what the actual life style is about, especially for a wife 20+ years away from retiring, hanging out with her aunts and uncles, or great aunts and great uncles in some cases
2) what kind of house you will feel comfortable with, location, and limitations.

Just recently golfed with several people from Indiana, who are here renting for 4 months, and have done so for the last several years. All are retired. . they are thinking of owning, and have been exploring the idea with actual experiences. .

that approach is in your best financial interest. .
good luck in your decision.

former finance guy,
now just a financial advice poster to people who don't need it as they are already living the retirement dream

What are "non cash expenses" ?