Real Estate: Cashing In or Trading Up? March 15, 2006
With real estate prices so high, do you know anyone who has sold and cashed out to downsize? Because we’re relatively young, since last summer, we thought of selling our home and downsizing until the market conditions are better to buy a bigger home for a future-growing family. (Remember capital gains in real estate is tax free in the US up to $250k for an individual or $500k for a married couple). In NYC, even if we wanted to downsize, it is more expensive to sell and rent or buy. As mentioned before, rental costs average $3755 per month in 2005 in Manhattan. We’re seeing a softening in the NJ market, so we have decided to place our home up for sale and move to an area with more potential for gains. Of course we’re not saving more, but we’re moving to an area we love and believe that that area is more desirable place for real estate in the long run.
Speaking of downsizing, this is an the extreme opposite of it. I don’t know why there’s a need for rich people to buy bigger and bigger homes. The article from March 13, 2006 in the NY Times about the 38,929 square foot, 11 bedroom, 16 bathroom house in Greenwich, CT is rediculous. Who needs that much room? Click on the graphic for the image of the house:
He said he wanted a home that would be suitable for entertaining and have room for his children’s friends and his future grandchildren to sleep over. “We have one guest room,” he said of his current 5-bedroom house. “I go down in the morning and there’s people sleeping on sofas.”
Poor guy. He’s got no room in his house, so he’s building a home with 4 kitchens and 11 bedrooms. Maybe he should charge the people who stay overnight on a regular basis? It’s hard to feel sorry for these people, but I suppose if you have the money, you’re entitled to do what you want.
So, are you cashing in or trading up?
Source:
Land of the Big Puts ‘Too Big’ to the Test
By ALISON LEIGH COWAN, NY Times, March 13, 2006