#AspiringRealEstateMogul

 

It started so innocently, with a simple thought, in 2018.  Given the big gap between Aaron and Asher, by 2029 our two older kids would have graduated from college while Asher was still in the nest just starting high school.  At that point, we didn't necessarily need a six-bedroom house.  And the advantage of our present location allowing our kids to go to a great neighborhood K-8 school would at that point no longer be relevant to our family situation.  If so, why couldn't we downsize by then?  And, if we wanted to downsize to a smaller place by then, why couldn't we hunt for that place now, giving ourselves a huge negotiating advantage since we had such a long buying window?

That window opened wide open over a year later, when we found the unit on the Delaware River that we closed on in June 2019.  I learned a lot during that initial house-hunting period, thanks to a great realtor who not only showed me all sorts of places all over the city but oriented me on how to process both facts and emotions when making such a huge financial and life decision.  

I now carry that approach to a seemingly constant hunt in many more locations that just our current city.  I'm embarrassed to say just how many alerts I have on Redfin.  And for privacy's sake I'll withhold naming which cities those alerts are tracking.  But each one represents an idea, however practical or fanciful, which if a place comes up that checks all the boxes, it's worth a good hard look to see if it's worth going for it.  

Earlier this year, we were lucky to find a great place in the Adams Morgan neighborhood of Washington DC, which will hopefully generate revenue continuously and be available for us to live in here and there when we're older.  Other places may open up and drive our future life and travel plans, and vice versa: the desires of our senior years may come into greater focus, or any number of life events may drive us to one place or another, which will then dictate our real estate wishes and actions.

I use the hashtag #AspiringRealEstateMogul, but it's mostly in jest. Despite my tracking comps in so many different places, I don't really aspire to own an empire, retire early on its income, or crave the status that comes from sharing pics of opulent living rooms and sunset views.  My constantly combing Redfin is all in fun but is mostly practical.  It will fall well short of an empire, but I do seek a portfolio, which will accomplish a number of things for me.  In no particular order:

1. Financial.  The numbers have to work, meaning that I have to cover annual costs with rental revenue while minimizing downside exposure in case everything goes to rot and I'll left holding the bill.  That means being very judicious about how much I pay for something, which in many markets means sticking to small places and avoiding the highest-premium locations.

2. Fun.  In real estate, it's location location location.  The trick for my searches is that the location has to work for us, and since I have to think about rental revenue it has to work for others too.  To cite one example, I've spoken often of the allure of Miami.  There are certain things Amy and I like about Miami, and other things that aren't as important.  But if we buy a place there, we have to be mindful of both where we'd want to be and the site has to work for others whose preferences are different than ours.

3. Flexibility.  Who knows when we'll retire and to where, as well as where we or our kids might need a place temporarily or indefinitely.  A portfolio of places expands our choices and is therefore worth the headache of hunting for them.  

For the amount of time I spend on all this, it can neither be described as fanciful or practical.  If I wanted to be more fanciful, I wouldn't be so grounded in where I'm hunting and what I'm seeking.  And if I wanted to be more practical, I'd realize I'm spending way more time than is justified by the resulting pay-off.  Call it all an innocent pastime, with reasonable aspirations and practical implications.  Just help me by taking away my phone if I start to go too far down the rabbit hole.