Talk of The Villages Florida
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Talk of The Villages Florida (https://www.talkofthevillages.com/forums/)
-   Investment Talk (https://www.talkofthevillages.com/forums/investment-talk-158/)
-   -   Thoughts or Ideas on Second Home... Financial or Tax Thoughts (https://www.talkofthevillages.com/forums/investment-talk-158/thoughts-ideas-second-home-financial-tax-thoughts-356649/)

MNViking 02-18-2025 04:29 PM
Quote:
Originally Posted by DrMack (Post 2410280)
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 02-18-2025 04:31 PM
Quote:
Originally Posted by rjm1cc (Post 2410281)
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 02-18-2025 06:59 PM
Quote:
Originally Posted by MNViking (Post 2410289)
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 02-19-2025 06:15 AM
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 02-19-2025 08:07 AM
Quote:
Originally Posted by CoachKandSportsguy (Post 2410009)
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" ?

virtue51 02-19-2025 09:00 AM
Invest your money with Vanguard, Fidelity or other financial investment company for 10 years -- 10 years is a long time and the housing markets change over time.

thelegges 02-19-2025 09:13 AM
Quote:
Originally Posted by jimjamuser (Post 2410233)
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.
As my parents aged they lost body and muscle mass, needed warmer clothing, summers and winters temp in the house 80 degrees year round.

How many times in restaurants and shops do you see older TV residents wearing sweaters and jackets in the summer.

Not sure how old you are, but notice with many friend in their 80s living in TV, the inside temp is like walking into an oven. Rarely do they spend anytime in lanai with temps below 75. It’s so hot for us we limit time in their homes, and invite them to ours, always remind them to bring a sweater.

Sully2023 02-19-2025 09:35 AM
Have two homes - where to spend the cash assets
 
Quote:
Originally Posted by MNViking (Post 2409974)
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 think you should pay a person locally to look at your financial situation first, then a tax accountant based on what you believe you want to do. Your comments are so open about what ifs? The best people are those who run these numbers.

CoachKandSportsguy 02-19-2025 12:50 PM
Quote:
Originally Posted by Sully2023 (Post 2410409)
I think you should pay a person locally to look at your financial situation first, then a tax accountant based on what you believe you want to do. Your comments are so open about what ifs? The best people are those who run these numbers.
:coolsmiley:
:agree:
:mademyday:

of course, that's my professional skillset, so

:bigbow:

TVTVTV 02-19-2025 01:19 PM
Quote:
Originally Posted by MNViking (Post 2409986)
It is right around 4% for current home.


@retiredguy123

As for spending time down there, at current 4-6 weeks, but Not sure I want to pay for a place 10 years now at those future costs with income becoming smaller as I will be retiring. Could also rent out if we chose.
Since you are both young, I would highly recommend not buying a 2nd home anywhere until you are close to retirement. So many things change with time...jobs, family, interest rates, health, etc. Rent weekly or monthly to explore and enjoy not having to worry about the responsibilities of two homes. Assuming you might be working another 5+ years, most of us have no vision on what TV will morph into. You may not like the area you choose now when you can be here full-time. Likely, for the $300K home you could get today it would be smaller than what you really want for your permanent home in the future. Regardless, home values are likely to rise if you wait until closer to retirement, but keep in mind your current home should do the same, so some offsetting trade-offs when you sell. I'd avoid the extra headaches and time. Yes, it's expensive to rent, but that takes a lot of stress away also. Reevaluate when you are closer to retirement. Keep in mind that so many people that buy their "forever" home do end up moving again for a variety of reasons.

yankygrl 02-21-2025 02:45 PM
Quote:
Originally Posted by MNViking (Post 2409974)
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?
Without reading any of the of the other responses - my first thought is check with your financial advisor where you currently reside.


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