The Personal Residence Conundrum


As an investor who has an ownership stake in 8 properties, you could say that real estate is on my mind quite frequently. I’ve been blessed to not only earn high income, but I also got started with investing (and frugality) at a pretty early age. With that said, I’m also somewhat unfortunate in the regard that I also happen to live in one of the most expensive cities in the country (Silicon Valley).

So, naturally, a question I get asked quite often is whether or not I own my own personal residence? I’ve answered this before, but in case you missed it, the answer is no.

If circumstances were different, like say I lived in the Midwest, then I’m almost certain that I would own and occupy my own single family home right now. But living in the Bay Area (as many are aware), the barrier to entry is very high, so if you are going to put down some roots, you had better be sure you know what you’re doing!

I’ve lived with family or rented my entire life. Right now, I’m currently living with family again, as I live with my brother Living Proof (a contributor to this blog). We split all the bills, and life is pretty good, as we get along well for the most part. However, being the planner that I am, I can’t help but look down the road and realize that our situation is only temporary, and sooner or later things will change for the both of us…

The reality for me right now is that when I think about owning a personal residence, I’m left with uncertainty and question marks.

For instance,

  • Do I want to stay rooted here in the Bay Area long-term?
  • What location will I settle in?
  • Do I care for good school districts?
  • How many bedrooms?
  • How many bathrooms?
  • Condo, townhouse, or single family?
  • Do I need a backyard?

At this stage of my life, I really can’t answer any of those questions. All I know is that I have a serious case of wanderlust and want to start traveling around the world… I’m not sure if buying a primary residence right now would be in my best interest.

As investors, we all know that your own home isn’t really an investment anyway (unless you plan on speculating on massive appreciation down the line)… On the day-to-day, it’s a money pit. True, I could scale back down and get something more affordable so that the cash flow numbers work better so that someday in the future I could conceivably turn the property into a rental…

But I already own two such units in the Bay Area… Do I really need another minimal (or negative) cash flow property?

For me, it also doesn’t make much sense to throw down a $100,000+ downpayment to try and secure a nicer $800,000 single family home in a wonderful location. For starters, I would be out of pocket for more each month than what it cost to rent a 1 bedroom…

What it comes down to, most importantly, is that I’m still single and have no idea who my future partner is… How can I predict in advance what she might want? Who knows, maybe she’ll have more wanderlust than me and never want to stay rooted in any one location for too long? I can’t say for certain, but I think I could be down for that… Or, we might relocate to a cheaper location so that we could stretch our dollar further? Perhaps she’s also a Bay Area native and never wants to leave, and in turn wants to buy that aforementioned $800,000 home and start a family?

I just don’t know… So, that’s why I’ve done nothing up to this point, but instead continued focusing on my investment game. These days, my health is the number one priority.

But regardless of where my future takes me, I’m almost certain that I’m going to be grateful for making the decision to start investing when I did (sooner rather than later)… even though I didn’t have many things figured out.

Such is life…

Yes, it does kind of suck that I’ve gone about life in kind of a backwards fashion! Isn’t the proper sequence supposed to be: get married, buy a house, and then really start figuring out all this finance stuff?!?

You would have had me fooled if you told me beforehand that my life would turn out this way!

Anyway, so I invested like crazy, and am now about ready to retire… Soon, I will need to indulge in wanderlust and then find my wife so that I can finally figure out where I want to live long-term…

Right now, I don’t have the answers, unfortunately… So, I’m just gonna keep swimming until I do.

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Midwestern Landlord
Midwestern Landlord
5 years ago

When you own rental real estate, in theory, you own several homes. You just happen to rent them out and certainly could move into one at a future date. No reason to take on a large personal monthly obligation until you decide what is in your best interest moving forward. Most people that do become FI early tend to have modest / reasonable housing costs. So unless your future wife has more money than you, I would not give up my FI dreams over someone that is not on the same page financially. You talked about doing things in reverse… Read more »

5 years ago

This is definitely a conundrum and in a way, much harder than finances. Life is much harder to figure out to me. I didn’t go the “conventional” way either and bought my condo at 23. I feel like I bought it early enough that it’ll be fine to sell it if I end up wanting to buy a bigger place with my SO. In fact, I would be totally okay with selling now and walking away if that was what we wanted since I should already bank a decent profit on it AND it’s been cheaper than renting by about… Read more »

5 years ago

Hmmm, yeah I wondered about that for you. Personally, it was really difficult for me to get started. I barely bought the house that I did. However, I had a bunch of ideas for renting out rooms in a cheap home, ultimately settling on my duplex. I have had ideas for building an in-law in the backyard or turning it into a triplex converting the basement. Since my gf helped me fix up the primary unit I’m letting us live in it for a while. But I definitely think I could move out and rent it out for a good… Read more »

5 years ago
Reply to  FI Fighter

Yeah, iUnno it seems with Bay Area real estate people have been betting on another correction the past few years since 2008 and it hasn’t come yet, then again I guess 7 years in the scheme of things isn’t too long.

Yeah, my unit is pretty smaller/cozy at 1 bedroom/1 bath and ~600-700 sf. However, it works for us right now. At times I think it’d be nice to have a little extra space, but honestly, I don’t think it’s worth the increased cost for the moment.

No Nonsense Landlord
5 years ago

I would rent. The reason being is you can rent a place close to work, and move when you need a new job. If you move overseas, it’s a lot easier.

Save your money, use the shorter commute time to devote to a side hustle. Or go for a promotion. As long as you get along with your brother, you are saving a lot.

5 years ago

Agree you should rent till you get that figured out. Since you already have 2 properties in the bay area you are covered. I bought a SFH in east bay 2 years ago.

BTW do you have a post detailing your current annual expenses and how did you arrive at a number which you think lets you retire? Would help me determine my “number” as well.

Income Surfer
5 years ago

I think you’re right on Fighter. Plus the rent vs ownership argument is grossly skewed in places like where you live. I always figure that unless you’re going to live somewhere for 7 to 10 years, it’s better to rent……if just for the flexibility. Have a great week buddy. I’m glad you’re recovering so well!

5 years ago

you could buy a SFH 3/3 and rent out two of the bedrooms and cover close to 3/4 of your mortgage


[…] the last post, I touched on my personal residence conundrum. Although I’m currently on a leave of absence from work right now, I do plan on returning […]