Would you buy a home, go travel abroad, OR do you do BOTH?!

[Matt Lee]

Hey, what's guys?

This thread is just to satiate my curiosity and possibly those on the younger boats. People who still have traveling-abroad-blood running hot through them. (BUT we understand the power of getting in early in real estate)

So to give you some context, I was reading the thread "Why You Should Buy A Home As Early As Possible".

As I was reading through it, this appeared:

I certainly wished I bought Real Estate earlier! I lived abroad for 5 years so wasn't interested in real estate at the time...then COVID happened.

I was about to reply then and there asking @JasonR :

"What would you have done differently or suggest your younger self to do? I know it'd be to buy a home early on as you wrote, but how would you go about it whilst traveling and living abroad? Or is it one of those things where you choose one thing over the other for the time being? (you can have it all but not everything at once type of thing)"

But then I thought a lot of members of TFLF may have experiences with traveling abroad and purchasing homes whilst doing so. Hence, it's probably better to open a thread for a discussion.

 

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[Shono]

Funny. I was just thinking about this exact topic earlier today. If it’s possible I think it would be an interesting way to pull in income from a 4-plex and essentially live for free in cheaper countries (so as long as you have a trustworthy manager in place in case something happens while you’re abroad.) The only thing for buying a home and making it a primary residency is that, at least in Canada, you have to live in it for at least a year to avoid capital gains tax implying it’s an investment you might later sell.

I am curious to hear the replies. What kind of home would you buy?


Edit: I was wrong about the primary residence policy.

 

[Johnny boy]

Might not want to buy remotely but you can certainly make payments remotely.

You could buy a first place and when you travel you can airbnb it out to cover costs while you enjoy living somewhere cheap.

Daily work: spend time growing business
Home: build equity and cover mortgage
Live: cheap place for digital nomads
At any time you can come back and live there yourself, can keep storage in garage, not totally unusable like a full rental would be where they get the garage and you could never stay there.

Write off expenses, depreciate the property, now you have almost no income tax with moderate low income combined with real estate, and get full appreciation benefits with property.

It's just hard to tell when a good time to buy is. I am no expert in that regard.

 

[JasonR]

I would buy the house I wanted for my primary, wherever that was, and AIR BNB or long term rent it if I planned on traveling abroad for long periods of time.

When I travel now, my primary sits empty (I'm at my Ski/mountain home right now, which I rent out as a vacation rental in the winter).

At some point, not all decisions are based on money. It's convenient to be able to afford traveling/living abroad while also being able to make your house payment.

 

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[mikecarlooch]

I would buy the house I wanted for my primary, wherever that was, and AIR BNB or long term rent it if I planned on traveling abroad for long periods of time.

When I travel now, my primary sits empty (I'm at my Ski/mountain home right now, which I rent out as a vacation rental in the winter).

At some point, not all decisions are based on money. It's convenient to be able to afford traveling/living abroad while also being able to make your house payment.

off-topic. But welcome back to the forum dude lol. Your posts are legendary

 

[Antifragile]

The only thing for buying a home and making it a primary residency is that, at least in Canada, you have to live in it for at least a year to avoid capital gains tax implying it’s an investment you might later sell.

This is not so. You can declare any home as your primary residence without needing to live in it. For example, I used to own multiple homes and chose to declare the one that gained the most at the time of sale (in $$ figures) as my primary for the tax free gain. People who amortize (write down amortization expense for tax declaration) on a property can no longer claim it is their primary residence.


Back to the thread topic:

- I view home base as an additional asset for business. If you have a base, your network of friends can help you tremendously down the road.
- Short travel to get it out of your system ... why not? But eventually I think one needs to have some roots somewhere. That's how I'd say you buy.
- Most people will have a family. Most kids will go to school. Friendships will be formed there, home base is important for that too, not just business.
- Great schools are in the most expensive areas. Homeschooling is an option but don't forget that going to a private school, your kids will have access to other kids with parents who send their kids to private school. Meaning you develop a network of contacts that is a big advantage in the future.

If you are going to buy a primary home, I don't think of it as a pure financial investment. I view it from a much bigger picture approach. Where do I really want to live? What will my lifestyle be like in 10, 20, 30 years? How can I prepare for the future success?

Where would you live if money was no object? If it's digital nomad, then don't buy anywhere until you have capital excess cash to diversify / park money. If it's a specific location, get in there and start building roots. You must know the market to then identify a good deal when you see it. Real estate from one street to another changes dramatically.

Just my 2 cents.

For travel: travel... Any business that's even moderately successful should allow you to travel from countries like the USA to the rest of the world. Hopefully this means you do both, buy a home, live there & travel when you feel like it.

 

[biophase]

Hey, what's guys?

This thread is just to satiate my curiosity and possibly those on the younger boats. People who still have traveling-abroad-blood running hot through them. (BUT we understand the power of getting in early in real estate)

So to give you some context, I was reading the thread "Why You Should Buy A Home As Early As Possible".

As I was reading through it, this appeared:



I was about to reply then and there asking @JasonR :

"What would you have done differently or suggest your younger self to do? I know it'd be to buy a home early on as you wrote, but how would you go about it whilst traveling and living abroad? Or is it one of those things where you choose one thing over the other for the time being? (you can have it all but not everything at once type of thing)"

But then I thought a lot of members of TFLF may have experiences with traveling abroad and purchasing homes whilst doing so. Hence, it's probably better to open a thread for a discussion.

If you don’t care about where you live in the US. I would research and find someplace that you would like to call your home base. One thing that hasn’t been discussed is possibly purchasing a new construction home. Many builders require only $5000 down and you can get yourself a home under contract that will not be ready for another year.

That’s probably something that I would do if I wanted to travel abroad for a year. Then after a year, when my home is done, I would come back and live in it or rent it out.

If this is your strategy, then you must do the rental calculations, whether it be a short term rental, or a long-term rental before purchasing.

 

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