Most of your assumptions are dead on: We are renting from a long time holder – 30+ years who used to live in the house and moved about 5 blocks away about 10 years ago into a bigger house with their elderly parents. They have no intention of cashing in for the foreseeable future. Last time we spoke, I asked very directly why they wouldn’t sell now. They said they don’t need the money and that we “could stay as long as we want”.
I guess they like tenants who have called them a total of one time in 4 years about an issue with the house (small roof leak). If something is broken, I fix it and just let them know it was done. Don’t even ask for them to pay for the parts.
Regarding buying 4 years ago: Simply put, didn’t have the same financial resources 4 years ago that we do today. Back then, would have been a difficult and stressful stretch to buy a $2m home. Now we could buy something twice that value with relatively comfortably and may do that if we find the right opportunity.
Regarding taxes… while we take advantage of strategies to reduce tax burden, we must be some of the rare people who consider paying taxes a good problem to have.
WCF: Thanks for the suggestion on REIT’s. I’m going to do some additional research.
that makes perfect sense, at this stage why would you want to leave your current home, which is in a great location, great situation and essentially subsidized housing, wouldn't be prudent to move up to a 4mil dollar house, or like you say moving out to the valley isn't really an option.
As for taxes that is indeed a good problem to have and definitely something I need to figure out the best way to reduce my tax burden...so far its to keep holding on to what I have, but at some point I will want to retire early and cash out some chips. One thing I'd love to do is work with my neighbours to assemble our lots and roll it over into a rental building, thus having a steady stream of income and ideally maximizing the return on my land, but that's probably a different topic for a different day!