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>staying in jobs past retirement

Keep in mind that the main reason for today's seniors to continue working after age 65 is because the ladder was already being pulled up when their fathers and grandfathers were in their teens & 20's, by the same forces that are still acting today.

If you do the math you would have to figure that the majority of people working to reduce opportunities for today's young people, are not senior citizens but mainly just a different class of younger people closer in age to their 20's than their 60's.

>Really, any sufficiently simple path to wealth that doesn't involve the capital class gets patched out by the system relatively quickly

So true, but sometimes quicker than others.

It's more like a zero-sum outcome for seekers of a simple path to riches before a certain age, of which there is never going to be enough opportunity to satisfy.

You can't buy yourself out of a financial system by working for money.

You don't stand a chance unless you work for something else more worthwhile.

And why would you want to retire from that?

Hanging onto property long after you need it? Thats crazy. I'm of the belief you should never sell property unless you're in dire straights or you know it's never going to a viable asset (including in this if you have a property in an overheated area that you know is overvalued...then yes, by all means, sell!)

You can always find something to do with property to generate income. Once that property is gone, you'll probably never be able to buy it back for what you sold it for

I've got this situation now, and interested to hear your take.

Primary home with ~400k in equity, 400k loan @ 2.7%. Moving and bought a new house, and deciding what to do.

Market is hot, equity up 300k in 3 years.

I always believed in this "don't sell property, you can always generate income" but now that i'm facing this decision, I don't see how to justify keeping it.

Cashflow (factoring in expenses/maintenance/vacancy) from renting would be ~$400/mo. If you include principal paydown, then it'd be ~$2000/mo.

Selling the property, and taking the equity seems like the best option. Either a) rolling it into the new house or b) investing it in nearly risk free muni's. Both of those would net me more than keeping the property with a significantly better risk adjusted return.

If you live in a place with wild property appreciation over the last 4 years (most of the country), then I don't really see how it makes sense to keep a property. What am I missing?

Do you feel like the market is going to cool massively in the next few years? If you don't see your equity evaporating in the near term, why would you sell now? Let renters pay off the loan for you, drop the $400/month into a money market. If you need cash in the future, you've got 400k basically sitting there ready to go, and if you don't the cash, you've got a savings account someone else is basically putting money into for you.

> Do you feel like the market is going to cool massively in the next few years? I don't - IMO the weight of held low interest rates is going to keep inventory low for a long time.

We've got to live somewhere, and the new house has a mortgage at 7.65%. The principle decrease + cashflow from holding the existing property barely offsets the interest cost on new property.

So I guess the way to look at it is a zero-cost, but potentially highly stressful, bet on the property market appreciating?

I was in this same situation a few years ago.

Ultimately what it came down to was my own sanity of managing a rental, and I didn't want to be a leech on society. It is important for people to be able to buy houses. I sold it.

Money from the house went into some vanguard funds, a young family got their first house, and I have a lot less stress in my life.

Made this same decision recently.

Leading up to selling the my previous house I had literally every person I talk to tell me I should keep it as an investment. It's in a HCOL city, but it's a townhouse in a slightly rough neighborhood. Great starter home for my family, but not a rental I wanted to manage. Being a landlord in this city is also fighting upstream against the politics.

The money dropped into my account a few weeks ago from the sale. The profit on the sale was not mind blowing, I bought and sold it for a fair price (2018 -> 2024).

Zero regrets.

I believe in making my own decisions that work for me and my family, not just blindly following the crowd. It's working well so far.

Be glad you managed to buy a property at all and were able to capitalize on this.

As part of not blindly following the crowd, I took a risk on a startup back in 2017 and took a huge paycut in the hopes it would pay off down the road.

Not only did that not happen (which again, was part of the entire point of taking a risk), I had pissed all my retirement away to stay afloat, changed jobs to start making good money again, but not before real estate got out of control and I'm basically worse off now than I was a decade ago in relative terms, especially since I was affected by the mass tech industry layoffs last year, was unemployed for months, and then secured a job for far less than before, going from 120k down to 50k annual income, which is humiliating and awful. And to top it all off... I don't have any major assets to speak of aside from some money in a ROTH. I'm at the mercy of landlords.

I've been applying at stuff for nearly a year and, aside from the job I'm working at now that I got through the unemployment office, I'm getting nowhere on the job hunt.

Your profit might not be mind blowing, but in my mind, you're way ahead of folks like me that took a different path.

You might be better getting into contracting for a while instead of fulltime. It has it's downsides and a feast/famine sort of cashflow, but it's a quick way to earn while building new trusted contacts and networks to help reveal more fulltime opportunities in future.

I personally would stay away from the online platforms (although others may attest differently), as they can be a race to the bottom in terms of price.

Instead hit up tech meetups in your area, give some talks, and let people know you're a gun for hire. Write some linkedIn posts in your area of expertise (yes folks that overdo this can be a bit cringe, but a little high effort content will go a long way).

Sorry for the late reply, but you're correct on all of that. Thanks for your input and suggestions. :)

If you are doing this sort of evaluation do not forget to consider the taxes, which can shift things remarkably based on your jurisdiction.

If one sold the property and invested the rest you will be paying some sort of taxes on the investment returns (at varying rates depending on the investment), while with the property it may be possible that the taxation could be low to nil. By writing depreciation of the property against your rental income it is possible you could pay no tax at all.

Also do not forget to consider various costs associated with the sale of the property.

I'm very curious about this too.

My understanding of it is that you have something of great value right now, which is that 2.7% loan.

I think the conventional wisdom on not selling the property has less to do with the cash flow and more to do with having that very cheap debt leveraged such that you "get" the return on the value of the entire property rather than just your portion of equity in it.

But I think individuals, for pretty good reasons, put a higher premium on cash flows in the shorter than on-paper wealth in the longer term.

But I wish I knew the specifics of how to quantify the value of that fixed loan relative to investment returns.

And even if there is a strong quantitative argument for holding onto the property and renting it, I think there is still a strong qualitative argument for "I'm a person with other things to do, I'm not a rental business proprietor".

> Hanging onto property long after you need it? Thats crazy.

You're missing the point.

Yes. It's financially suboptimal to do this. But it's destroying society.

And while this requires policy change to fix, policy change is still "SUBOPTIMAL".

How is this destroying society?

Because young people cannot afford a home to raise their families in. Because enormous amounts of wealth from the productive sectors of the economy are being siphoned to the class of the landed gentry in exchange for no benefits to society at large.

People love hating modern tech billionaires or old time industrialists, but this class at least create something and hire people.

Thanks for making exactly the point OP was trying to convey.

> You can always find something to do with property to generate income.

Where do you think that income is coming from? Especially when we are talking about a limited resource like housing, the dollar of your “extra income” is a dollar that a young family could have saved for their future.

Now here's the next step in your small thought experiment. Expand income coming from for everything. Whatever you do now at the company (assuming you are working) where does that money come from? Work through the logic on income.

People love to demonize small property owners who have a rental property and take a moralistic campaign but don't look at how their own lives are funded.

And here's yet another step: most other markets aren't as resource-constrained as housing is. If the Yankees win the world series and more people want Yankees caps, manufacturers can just make more. Demand goes up, supply goes up, everybody's happy.

Housing, at least in the USA, often doesn't work like this. The population grows and more people want to live in place X and the current NIMBY occupants of place X go to the government to make sure more housing can't appear in place X. The current occupants make some arguments about neighborhood character that are really about preserving their own lives and investments and another family goes to a worse district or a worse house or no house at all.

Housing is a unique investment category, pretending it's like everything else is disingenuous.

I agree that housing is a complicated market with a lot of varying factors. It never really fits a simple model that people like to package it in. Each market is regional with some national/international overlays and its tied to the economic power of that market. It is impacted by policies both economic, financial and political.

The origin of all wealth is labour, there are no exceptions. Somebody needs to work to create the resources and do the services that others purchase. There are no exceptions and this is the most fundamental fact of economics.

You are arguing as if workers receive their wages as a gift or some kind of welfare. They receive their wages in exchange for their labour.

If you think that wealth actually comes from the monetary supply, then you'll have to go down the Zimbabwe route and print trillion dollar bills.

I didn't bring in economic money supply to the conversation so your comment is unrelated to mine. You created a strawman.

I didn't argue "workers receive their wages as a gift or some kind of welfare."

And I want to just highlight that "all wealth is labour" is actually not a universally held truth nor a fundamental fact of economics but is the basis for one theory of economics: the Labor theory of value (Smith and Marx).

Build your argument from a solid foundation and not something that is easily picked at apart by inaccuracies if you want to yield influence.

Well, if you go down the route of "where the money is coming from" you arrive at the central bank that creates that money out of thin air. That's why it's fundamental to understand that wealth can only be created by labour. It can then be distributed according to any system imaginable, but it is always created by labour. Wealth as in real physical goods and services, not as in the number in your account.

I'm not saying that all labour creates wealth. That's something else and I don't believe it. Trench warfare is the most laborious thing imaginable and it certainly creates no wealth.

> I didn't argue "workers receive their wages as a gift or some kind of welfare."

You absolutely did not, but I sensed that angle. The difference is that a worker will never receive any wages in exchange of not doing anything, while a landlord will always receive his wages for not doing anything. "How their own lives are funded" are through their labour when it comes to the worker and through the worker's labour when it comes to the landlord.

You are really just trying to get to rent-seeking behavior provides little value. My argument is that a lot of tech companies are providing rent-seeking behavior at a huge scale - and if you work for one of those companies in which you are deriving your income from that very behavior - how can you be so high and mighty about a small time landlord deriving small money from rent-seeking behavior except for, when of course, it hurts your own pocket.

"Small money" is relative. Rent is the largest expense for most workers.

Most tech companies operate on a free market where nobody is forced to pay them if they don't want to. Nobody is strictly dependent on their services, while we are all dependent on having shelter. And painting with a broad stroke you can't say that tech companies are rent-seeking, information technology is highly beneficial for the economy at large, in practical ways that are too numerous to list.

It's not one small-time landlord, it is millions of small time landlords. Just like one small time police officer demanding protection money from local businesses is not a problem for the economy of a nation, but millions of police officers doing that is.

You could say that people can go somewhere else if they don't like it. Don't hate the player, hate the game. And that is true, I think a lot of people will go somewhere else and are already doing that.

With that said, I've never worked for a company engaging in rent-seeking and never done that myself, tech or other industry, so in that aspect I'm completely clean even though I'm a sinner like all of us.

The salaries are high because the number of people who can do the work is so small.

And no I don't mean the JShit we have today. That you need an army of people to keep a gui running is the victory of Wall St over the hackers.

> That you need an army of people to keep a gui running is the victory of Wall St over the hackers.

I'd rather have 90% of a 1 piece pie than 50% of a full pie. 90 > 50

> Yes. And this takes many forms, whether that's hanging on to property long past you need it, staying in jobs past retirement,

You don't get to be upset that someone keeps their property for longer than you deem they need it, or telling people they should stop working to do nothing for their last 20 - 30 years of their life.

I'm not upset. It just causes problems in congested areas that don't build enough housing. Obviously, they should build more houses. :)

And how would forcing people to sell their house when they move out increases the number of houses??? Is still 1 house whether is being rented or owner occupied.

Speaking of hostile... Ironic to be telling people what they can do when you're unhappy about them doing the same!

As for me, I'm absolutely upset. Older homeowners sit on housing with multiple unused bedrooms in major cities (and everywhere else) while wages and construction have stagnated. It's another form of wealth concentration. Two 80-year-olds don't need a 6 bedroom mansion. Meanwhile there's families with kids (who by the way, societies depend on) out there with income to buy a home that are priced out of everything. Meanwhile the generationally wealthy family can continue to leverage their equity to buy up more property, further exarcebating the issue.

Let's not act like there's a moral ground here, it's all in self-interest and greed. And frankly many of us on HN are part of the problem (I know I am).

At least in the state where I live (WA) which is a non-recourse state is very hard (I would say impossible but that is a high bar) for an individual or a family to use existing real estate equity to buy more real estate.

Me and my wife own 4 properties. Each time we bought a property it was through a different lender (the cheapest one with the lowest interest rate). When it came time to existing rentals the paperwork wanted to know the lease agreement for the current tenants, monthly expenses and monthly rental income. There was no question about mortgage principal, nor about market value of real estate.

When we bought (yet) another property, the lender could not (and did not) use the existing real estate assets to secure the new loan. Each loan was secured by its property and nothing else.