So, I know a woman from high school (she was a year behind me) that I sometimes follow on Facebook. We were not friends in high school, but I was sorta friends with her brother who was a year ahead of me. I haven't seen her since high school, many years ago, since I moved away from where I grew up. But, she is very active on social media and one of those people who is friends with everyone and hard to ignore.
She is attractive, tall, super athletic (she played sports in college), fit and thin, and glamorous. She married an athlete as well, tall and handsome and super successful guy. I mean really successful - works in media in California. They have super attractive, sporty kids. I mean really sporty, probably will play in college level type sporty. Because he works in media, they attend fun events like award shows and movie openings. She is always posting photos in their black tie outfits, posing with celebs and the like.
Bottom line, it was easy to be jealous of her.
Recently, I went to her Facebook page because she had posted a quote that I had read but wanted to reread and save for myself. I couldn't find it though, and I was poking around trying to find it (as I'm persistent in that way). In my poking around, all of sudden I realize her about section says she is divorced. What ??!!?
When the heck did that happen.... I poke around some more, because obviously I'm entitled to know this woman's business (this woman that I haven't seen since high school, this woman who is not even a friend of mine) and see that she is no longer friends with her husband (now ex-husband) and his profile also says divorced. I see that they haven't really been in photos together for a year or so.
I was really shocked because they seemed so perfect and seemed to be living the most perfect life. But, you really don't ever know what is going on in people's life.
Social media makes it easy to compare our life to someone else's life, but social media, while a great way to keep up with family, doesn't give you the whole picture or the whole store. This is true in a "keeping up with the Joneses" mentality as well. People can project wealth and riches, but just because someone has a big house or a nice car that doesn't mean they are wealthy or financially savvy.
Showing posts with label Keeping Up With the Joneses. Show all posts
Showing posts with label Keeping Up With the Joneses. Show all posts
Tuesday, June 28, 2016
Thursday, May 26, 2016
Keeping Up With the Joneses - Part III
Earlier I posted about some of my friends and former co-workers that have been engaging in expensive housing purchases. See the posts here and here.
Today, I'm discussing Leslie and John.
Leslie and I used to work together, so we are in the same industry. John works in the arts business. I really have no idea what kind of income John pulls down, but back when Leslie and I worked together she earned considerably more than he did. I don't know if that is true today, but assume it is. Leslie and John have one child.
Last year they bought a $1 million dollar foreclosure home. Yes, a foreclosure at $1 million. Back during the housing bubble, the house had actually sold for $1.7 million so you could argue they got a great deal. I would expect the house to appreciate quickly and, in fact, the property appraiser has it assessed at $1.6 million. As a result, annual taxes on the home are $35,000 ($2900 a month).
The house is 4 bedrooms and has 4700 square foot of living space. It also has a pool. The neighborhood they moved to has an excellent elementary school, but after that it gets mixed for middle and high school.
They have a mortgage in the amount of $750,000. And, they also took out a home equity line of credit in the amount of $100,000. So total debt is $850,000. With a 30 year mortgage their monthly payment is $3800, add in taxes monthly carrying costs are $6700. This does not include insurance, which is expensive in Florida.
Leslie and John previously lived in very nice historic home in a community with a good elementary school. They actually sold that nice home for a decent profit - $172,000. There old home was also 4 bedrooms and had a pool. I'd argue their old home was in a better location because the street their new home is on is very busy.
Today, I'm discussing Leslie and John.
Leslie and I used to work together, so we are in the same industry. John works in the arts business. I really have no idea what kind of income John pulls down, but back when Leslie and I worked together she earned considerably more than he did. I don't know if that is true today, but assume it is. Leslie and John have one child.
Last year they bought a $1 million dollar foreclosure home. Yes, a foreclosure at $1 million. Back during the housing bubble, the house had actually sold for $1.7 million so you could argue they got a great deal. I would expect the house to appreciate quickly and, in fact, the property appraiser has it assessed at $1.6 million. As a result, annual taxes on the home are $35,000 ($2900 a month).
The house is 4 bedrooms and has 4700 square foot of living space. It also has a pool. The neighborhood they moved to has an excellent elementary school, but after that it gets mixed for middle and high school.
They have a mortgage in the amount of $750,000. And, they also took out a home equity line of credit in the amount of $100,000. So total debt is $850,000. With a 30 year mortgage their monthly payment is $3800, add in taxes monthly carrying costs are $6700. This does not include insurance, which is expensive in Florida.
Leslie and John previously lived in very nice historic home in a community with a good elementary school. They actually sold that nice home for a decent profit - $172,000. There old home was also 4 bedrooms and had a pool. I'd argue their old home was in a better location because the street their new home is on is very busy.
Tuesday, May 17, 2016
Keeping Up with the Joneses - Part II
Earlier, I wrote about some of my friends and co-workers whose house purchases have caused me to suffer house envy.
Next on the list, Jessica and Tony. Jessica and I used to work together and she and I are in the same industry. Tony works in the engineering field. They do not have any children together, Tony has children from his prior marriage and just recently concluded his support obligatins. They live in the same county we live in.
Last year, they built a home that cost more than a million dollars. The home is more than 5000 square feet and has four bedrooms along with a pool. Taxes on the home are $20,000 a year. They have a $1.1 million dollar mortgage mortgage. Carrying costs, assuming 30 year mortgage and not including insurance costs (which in Florida are expensive), are $7000 a month.
As a comparison, taxes on our home are approximately $3500 a year.
Also, when Jessica and Tony sold their prior home they lost $125,000 on the sale. They had bought pre-recession and the value of their prior home had not yet fully recovered.
What do you think about this type of real estate purchase? On the one hand, Jessica and Tony have a gorgeous home in a great location. On the other hand they have a $1.1 million dollar mortgage and that type of debt would keep me up at night.
Next on the list, Jessica and Tony. Jessica and I used to work together and she and I are in the same industry. Tony works in the engineering field. They do not have any children together, Tony has children from his prior marriage and just recently concluded his support obligatins. They live in the same county we live in.
Last year, they built a home that cost more than a million dollars. The home is more than 5000 square feet and has four bedrooms along with a pool. Taxes on the home are $20,000 a year. They have a $1.1 million dollar mortgage mortgage. Carrying costs, assuming 30 year mortgage and not including insurance costs (which in Florida are expensive), are $7000 a month.
As a comparison, taxes on our home are approximately $3500 a year.
Also, when Jessica and Tony sold their prior home they lost $125,000 on the sale. They had bought pre-recession and the value of their prior home had not yet fully recovered.
What do you think about this type of real estate purchase? On the one hand, Jessica and Tony have a gorgeous home in a great location. On the other hand they have a $1.1 million dollar mortgage and that type of debt would keep me up at night.
Friday, April 22, 2016
Keeping Up With the Joneses - Part I
So, for the past few years, probably five or so, more and more of my friends and peers, and even people who report up to me at work (so, I'd consider them non-peers) have been buying homes at purchase price points ranging from $700,000 to a million.
I find this phenomenon strange, but also incredibly alluring.
Let's start with an analysis of these folks. I will start with the ones who started this trend, and I do believe there is a somewhat contagious trend among friends that equates to keeping up with the Joneses. The ones who started the trend, in my humble opinion, likely made smarter choices.
1. It started with my friend Mary, all names changed to protect the innocent, and her husband George. Back in 2011, they actually got a great deal and paid mid $500s for a home that is now likely worth close to $800,000. They bought a 5000 square foot McMansion in a better school district, they have a small child, with 5 bedrooms, 4 baths in a new development. Their family consists of 3 people and they do not plan to have any more children so this is a house bigger than they need. Their real estate taxes are more than $8000. They took out a $400,000 mortgage. Five years later they are putting in a pool. The house they sold they had owned since 2002 and they made about $50,000 profit when they sold it. They were buying in a buyers market due to the 2008 real estate crash which means they were also selling in a buyers market.
Mary is in the same profession as I am, I assume she makes similar money to me. Her husband is in law enforcement. While he makes less money, he has a great pension that will be coming to him (and soon) such that their retirement savings is less crucial. I have one other friend who will have a federal pension, but she cannot collect said pension until closer to traditional retirement age. George will be able to start collecting his pension in less than 10 years and his pension is for life. As a result, they don't have to save as much for retirement.
2. Jennifer and Alan were next. They are a dual income, professional, couple. Both are in the same profession I am in. They have three kids.
In 2012 they bought a 4 bedroom, 3.5 bath, 5000 square foot home. It also has a 2000 square foot out building (with air conditioning) and a pool. They bought the home for $775,000 (the prior owner had bought it for $800,000 so, again, it was likely a good buy) and it is likely worth close to a million now. Taxes are $14,000 a year. They took on a $620,000 mortgage. Later they took on a $35,000 home equity loan.
They held onto their prior house for a couple of years, while the Florida real estate market improved (likely a smart move), and they later sold it in 2015 for a $265,000 profit. I don't believe they took that profit and reduced or refinanced the mortgage on their current home, rather before they sold their prior home they put it into a trust and I assume the profits also went into that trust.
They have engaged in a variety of real estate and trust maneuvers in the last few years. This is probably because Alan also bought an office building and they are creating protection for their other assets.
Does it sound like I'm stalking my friends' personal business?? Well I guess I am. All of this information, at least in Florida, is public record and readily accessible on line. I also am learning from what they are doing, and that is both positive and negative (more on that later).
I find this phenomenon strange, but also incredibly alluring.
Let's start with an analysis of these folks. I will start with the ones who started this trend, and I do believe there is a somewhat contagious trend among friends that equates to keeping up with the Joneses. The ones who started the trend, in my humble opinion, likely made smarter choices.
1. It started with my friend Mary, all names changed to protect the innocent, and her husband George. Back in 2011, they actually got a great deal and paid mid $500s for a home that is now likely worth close to $800,000. They bought a 5000 square foot McMansion in a better school district, they have a small child, with 5 bedrooms, 4 baths in a new development. Their family consists of 3 people and they do not plan to have any more children so this is a house bigger than they need. Their real estate taxes are more than $8000. They took out a $400,000 mortgage. Five years later they are putting in a pool. The house they sold they had owned since 2002 and they made about $50,000 profit when they sold it. They were buying in a buyers market due to the 2008 real estate crash which means they were also selling in a buyers market.
Mary is in the same profession as I am, I assume she makes similar money to me. Her husband is in law enforcement. While he makes less money, he has a great pension that will be coming to him (and soon) such that their retirement savings is less crucial. I have one other friend who will have a federal pension, but she cannot collect said pension until closer to traditional retirement age. George will be able to start collecting his pension in less than 10 years and his pension is for life. As a result, they don't have to save as much for retirement.
2. Jennifer and Alan were next. They are a dual income, professional, couple. Both are in the same profession I am in. They have three kids.
In 2012 they bought a 4 bedroom, 3.5 bath, 5000 square foot home. It also has a 2000 square foot out building (with air conditioning) and a pool. They bought the home for $775,000 (the prior owner had bought it for $800,000 so, again, it was likely a good buy) and it is likely worth close to a million now. Taxes are $14,000 a year. They took on a $620,000 mortgage. Later they took on a $35,000 home equity loan.
They held onto their prior house for a couple of years, while the Florida real estate market improved (likely a smart move), and they later sold it in 2015 for a $265,000 profit. I don't believe they took that profit and reduced or refinanced the mortgage on their current home, rather before they sold their prior home they put it into a trust and I assume the profits also went into that trust.
They have engaged in a variety of real estate and trust maneuvers in the last few years. This is probably because Alan also bought an office building and they are creating protection for their other assets.
Does it sound like I'm stalking my friends' personal business?? Well I guess I am. All of this information, at least in Florida, is public record and readily accessible on line. I also am learning from what they are doing, and that is both positive and negative (more on that later).
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