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Would you spend $10 Million on a home.

Topic closed. 83 replies. Last post 4 years ago by Teddi.

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Egg Harbor twp.south Jersey shore
United States
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June 29, 2011
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Posted: May 15, 2013, 3:20 pm - IP Logged

The very first button below your posting (red and white circle) will retrieve a lost post. (last thing typed)

Does that feature work if you have a power failure in the middle of making a long post ?

b/c we have power fails around here more than any other place I've lived.

Extraordinary Popular Delusions & the Madness of Crowds    -- Charles Mackay  LL.D.

    Teddi's avatar - Lottery-008.jpg

    United States
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    Posted: May 15, 2013, 3:58 pm - IP Logged

    Good analysis!Thumbs Up

    One slight exception, property tax on property in Palm Beach county for any home(not just waterfront) that is assessed at $10M is roughly three times as much at $200k.

    Property tax on more moderate homes assessed at $3M run over 60k per year. Many other counties in Florida have extremely high property tax as well.

    I Agree!  Mea culpa, Jill!!! I should have stated that the taxes in question was for one specific house I was looking at. I didn't do an analysis of other homes in PBC or even bother to look at their tax codes. I just love this one particular home and the asking price is just shy of $10M which was right on point for this discussion; taxes on it in 2012 were $67,144.

    Thank you for pointing that out. I don't want to intentionally mislead anyone. LOL. I didn't really care about the other homes, just this one, so it's the one I used to base my numbers on.

    *sigh* it's gorgeous. It came down from a $14M asking price, I believe. Right on the canal with a boat dock and in a gated community with security that patrols both the waterways and the roads within the community. And then the house itself is gated as well. I think safety will be A-OK. 

    But for $10M, it would have to be my primary residence and I would never have a house on the water in South Florida as a primary residence. You have one active hurricane season and you're evacuating your home every few months or weeks and most of the damage will come from flooding. It won't look so pretty being underwater or covered in mold.


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      May 13, 2013
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      Posted: May 15, 2013, 4:14 pm - IP Logged

      I Agree!  Mea culpa, Jill!!! I should have stated that the taxes in question was for one specific house I was looking at. I didn't do an analysis of other homes in PBC or even bother to look at their tax codes. I just love this one particular home and the asking price is just shy of $10M which was right on point for this discussion; taxes on it in 2012 were $67,144.

      Thank you for pointing that out. I don't want to intentionally mislead anyone. LOL. I didn't really care about the other homes, just this one, so it's the one I used to base my numbers on.

      *sigh* it's gorgeous. It came down from a $14M asking price, I believe. Right on the canal with a boat dock and in a gated community with security that patrols both the waterways and the roads within the community. And then the house itself is gated as well. I think safety will be A-OK. 

      But for $10M, it would have to be my primary residence and I would never have a house on the water in South Florida as a primary residence. You have one active hurricane season and you're evacuating your home every few months or weeks and most of the damage will come from flooding. It won't look so pretty being underwater or covered in mold.

      I wouldn't live there either exactly because of all the hurricanes. At least not on the east side of Florida, maybe some place like Tampa (gorgeous place). Also I'm sure they also get flood/hurricane insurance as well. It's also possible that the assessed value was way less than 10M. Right now the housing market is real hot (some say it's another bubble) and alot or properties that are on Zillow for 10M this year has only been valued at around half of that in the past 2-3 years. So the fact that 10M home was reduce dfrom 14M means it was way waaaay over priced and no one is biting.
      We have to look at the home itself rather than this is a 10M home or a 5M home or a 1M home.

        maximumfun's avatar - Lottery-030.jpg
        Lavender Rocket

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        Posted: May 15, 2013, 4:19 pm - IP Logged

        I like my home... I would travel... alot... but leave my home the same size.  Did I mention travel ALOT???


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          Posted: May 15, 2013, 4:21 pm - IP Logged

          I like my home... I would travel... alot... but leave my home the same size.  Did I mention travel ALOT???

          Totally agreed. I would pay off my home and mom's home. Then redo the entire driveway (it's all jacked up), finish the basement, get all new appliances, new siding, remodel the bathroom and kitchen, insulate and reroute the upstairs (where my bedroom is at) for better heat and AC control. Get better land scaping. Otherwise I like where we're living now.

           

          But I would splurge so much on traveling....get an RV and drive to 49 states, fly to Hawaii, go see Asia, Europe, Africa, Australia, etc. I wouldn't be home too often haha!

            Teddi's avatar - Lottery-008.jpg

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            Posted: May 15, 2013, 7:42 pm - IP Logged

            I wouldn't live there either exactly because of all the hurricanes. At least not on the east side of Florida, maybe some place like Tampa (gorgeous place). Also I'm sure they also get flood/hurricane insurance as well. It's also possible that the assessed value was way less than 10M. Right now the housing market is real hot (some say it's another bubble) and alot or properties that are on Zillow for 10M this year has only been valued at around half of that in the past 2-3 years. So the fact that 10M home was reduce dfrom 14M means it was way waaaay over priced and no one is biting.
            We have to look at the home itself rather than this is a 10M home or a 5M home or a 1M home.

            Frankly, I firmly believe that the entire South Florida real estate market is overpriced. Even when the bubble burst and properties were being halved. Even then it was too high. A few foreign investors came in and jacked up the price, then everyone with 2 nickels to their names (and some who didn't) started buying and flipping. When a person is able to buy a property today, and flip it in a month for $5K to $10K more without having to do anything at all to the property, everyone rushes to follow suit. The result is an extremely overpriced market. Everyone knew at least one person who suddenly went from a Toyota to a Benz, the profits were just too outrageous. Even people who didn't buy their homes to flip them, they bought them just to get a home before it became untenable, contributed to the problem. 

            As for the situation now, I don't get why water and sunshine are big market boosters, but hurricanes and flooding don't factor in as a detractor.

              Jill34786's avatar - Lottery-006.jpg
              Windermere, FL/Franklin, TN
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              Posted: May 15, 2013, 8:19 pm - IP Logged

              I Agree!  Mea culpa, Jill!!! I should have stated that the taxes in question was for one specific house I was looking at. I didn't do an analysis of other homes in PBC or even bother to look at their tax codes. I just love this one particular home and the asking price is just shy of $10M which was right on point for this discussion; taxes on it in 2012 were $67,144.

              Thank you for pointing that out. I don't want to intentionally mislead anyone. LOL. I didn't really care about the other homes, just this one, so it's the one I used to base my numbers on.

              *sigh* it's gorgeous. It came down from a $14M asking price, I believe. Right on the canal with a boat dock and in a gated community with security that patrols both the waterways and the roads within the community. And then the house itself is gated as well. I think safety will be A-OK. 

              But for $10M, it would have to be my primary residence and I would never have a house on the water in South Florida as a primary residence. You have one active hurricane season and you're evacuating your home every few months or weeks and most of the damage will come from flooding. It won't look so pretty being underwater or covered in mold.

              Chances are the home you were looking at has either been owned for a very long time and the Homestead exemption has been applied or it's way overpriced. Odds are that the assessed value is in the $3-4 million range...but the current owner may feel it's worth a bit more . 

              If the home you are looking at is in Jupiter, then most likely it's in Admiral Cove which is indeed a very nice neighborhood.Smile

                Teddi's avatar - Lottery-008.jpg

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                Posted: May 15, 2013, 8:22 pm - IP Logged

                I had written a long reply but due to my stupidity it got lost. Anyway, just want to say that this is an interesting discussion and no harm or foul is intended. It's useful to pick apart the numbers and just see exactly what the costs are...because I think too many people say well look A > B so I can afford B!  But we also have to look at other costs as well that are not on the price tag so to speak. But anyway in the end if you did have 120M cash a 10M home is certainly affordable in the sense that you can have it if you want, albeit it could be expensive. I was doing some quick looking up of Palm Beach county properties on Zillow and couple of homes that were assessed at 10M had property tax of about 180K...which was lower than I had expected. In any event, everyone does what they want with their own money and I agree with you that I personally would not want to shell out for such a home. It would be interesting to see how much insurance costs though for these massive mansions.

                 

                The other thing with the 3% inflation is not just about price of milk and eggs...it's about the dwindling purchasing power of money. $120M in 20 years is worth less than $120M today. So if no steps are taken to preserve the power of your wealth (and you spend like crazy) you are essentially losing 3% of your money every year (aka losing out on 3.6 million a year, since that's 3% of 120M). So for investing, you want to be gaining at least 3% each year to not lose money...and then hopefully more to earn money as well. It's more than just pure cash numbers and gawk at how much money you are making each month! Thing is you are losing something like 300K/month due to effects of inflation. People just need to know that and realize that fact and take steps to preserve the power of their wealth. Of course if someone wins that much JP, then even if they lost 3% every year to inflation they would still likely have way way more than they would've ever had so not a terrible deal even if you look at the worst case scenario (aside from blowing it all of course).

                Sorry about you losing your stuff. That blows. I see you are in NJ. Is it from Sandy or just the way it always is?

                As I just told Jill, I was going by one house I love in PBC. It's pretty much the only house in S. FL that I could conceivably be even vaguely interested in spending $10M on so that was my model. I forgot to state it was just for this one home.

                But while I can make an argument for getting a $10M house...barely, it chafes me to even attempt to make an argument for paying $200K for property taxes. Not. Happening!!!!!!

                I will not willingly hand over a ridiculous amount of money just because Florida is warm. For $200K a year I can buy a couple extra heaters and put in radiant flooring. Problem solved. For 200K I can buy someone a house!! 

                As for inflation, the milk and steak comments were jokes. Because here's the thing., my dad was a partner at PWC until he retired. I took accounting to understand it better and because I knew it would be helpful whether or not I followed his footsteps. The only subject I found more boring than accounting was calculus and perhaps geology. I think if I had to sit and stare at numbers all day I'd have killed myself. And taking the course didn't make his stories any more exciting...only vaguely interesting. Haven't gotten up the nerve to ask him why PWC missed Madoff. That at least should be interesting.

                Anyway, he would tell me what you're saying now, you're losing money if you do not meet X, Y,Z%. My way of doing it would be only marginally better than keeping it under a mattress, in his eyes. And probably yours.

                I'm aware of the facts...to some extent. Currency devaluation and inflation are going to erode your net worth if you aren't smart about it. What I'm saying is, rightly or wrongly, I don't care. Will I die with less money than I could have had. ABSOLUTELY. But as long as there was enough coming in to cover my expenses, make me have a little fun, take care of loved ones and leave college funds for their kids, I'm okay with that. My reasoning might give him a stroke, and because of that, I may change my mind about that later. 

                If the interest payments cover my expenses and inflation rates, great. If it's more, I'll be ecstatic. If it's less, I'm okay dipping into the principle once in a while to cover the net loss. As long as I am reasonable about it, and  I don't have to worry about being 80 and destitute, that's all I ask.

                Warren Buffet I am not.

                I accept my limitations and my hatred of accountingBang Head  I've made allowances for that. Banana

                  Teddi's avatar - Lottery-008.jpg

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                  Posted: May 15, 2013, 9:09 pm - IP Logged

                  Chances are the home you were looking at has either been owned for a very long time and the Homestead exemption has been applied or it's way overpriced. Odds are that the assessed value is in the $3-4 million range...but the current owner may feel it's worth a bit more . 

                  If the home you are looking at is in Jupiter, then most likely it's in Admiral Cove which is indeed a very nice neighborhood.Smile

                  It was built in 2009 so not that old and it's been on the market since 2009. LOL. idk though, a new 14k sf house on the water? If you can get it for $8M that would be a steal...by their standards. 10k sf on the water are going for $5M and those are the older homes. It's in Boca. Which I don't like, too overcrowded and trafficky. And I hope no one takes offense to this, but when winter  hits and the snowbirds fly in, it's my worst nightmare. Little tiny people driving the huge sedans, who can barely see over the dashboard, and who don't seem to think looking before changing lanes is really necessary. 

                  But I'm really in LOVE with Highland Beach. A stone's throw away from Delray. And crime was so non-existent when I was staying there, the cops work on a regular schedule. 8am to 5pm, then they lock up the station and go home. I didn't know places other than Mayberry actually did that. After 5pm they're on call if there's an emergency. It's pretty much all waterfront mansions and condos, with perfectly landscaped streets (yes, I said streets). Ridiculously expensive. But since I don't recall ever even seeing a regular non-mansion house there, that's understandable. 

                   I like Jupiter, Admiral Cove is lovely, except it's a little too far away from things.