Same! Except my wife quit her money-making job to take care of our kids full-time. I go to work, come home, and spend time with my family. Every Friday my employer deposits about $1,500 in my account, which represents an income stream of about $6,800/mo, not to mention paying for my health insurance and putting about $100 in my 401k. All I have to do is show up for about 40 hours Monday through Friday.
For a side hustle, we bought a home around 2015 for $125k. We've paid off about $70k of the 2.8% 15-year mortgage and property taxes at $1100/mo, it's now estimated to be worth about $330k. That represents an income stream equivalent to about $2200/mo due to that asset's value rising at about 15% per year. If it wasn't for the fact that I live here, I'd be divesting a lot of my investment in that obvious bubble ASAP. Similarly, my parents built my childhood home nearby in '96 for about $80k, their property is now worth about $750k, you do the math.
Congratulations on buying your house in 2015, it would be difficult to buy such a property at that price today without some large concessions on location or quality of the home.
However, I do agree with the sentiment of your post. It's a lot easier to live below your means as a way to grow income rather than to stretch yourself to try to make extra money externally. 40 hours at a well played, balanced job with low living expenses is truly a great path.
When I do the math, I do not consider my primary residence to be of any numerical value since I do not want to live anywhere else. And even if I did want to live somewhere else, I would have to account for the costs of acquiring a new similar residence, which in a similarly desirable area would have risen just the same in price.
And assuming I needed to live somewhere else, it would likely be because something undesirable has happened to the whole area, so the price at that point would be much lower than whatever it is at times before then.
You're probably right, on looking up the details it's actually $120 per weekly paycheck, matched by my employer, so it's not so bad as the estimated $100, especially if you assumed that was monthly, but that's still not on-track for my retirement target. I also haven't poured much into the Roth since my eldest was born. But kids are expensive...
(Also, I see I also need to use more of that ~4 weeks of vacation I've saved...)
I dont think so because they were able to live in the property while it gained value, so they didn't need to spend on other accommodations. Alternative living costs would factor in towards the decision to sell and what they can get with that value today, but im not seeing how it reduces the earnings.
You would need to subtract the YOY property taxes and maintenence costs (with inflation) to get actual net earnings, though
What is the point of unrealized gains if you can never realize them (spend them)?
One use case is being able to borrow more against the increased value, but I do not think that it is a good idea for 99% of people to use their primary residence as leverage.
For a side hustle, we bought a home around 2015 for $125k. We've paid off about $70k of the 2.8% 15-year mortgage and property taxes at $1100/mo, it's now estimated to be worth about $330k. That represents an income stream equivalent to about $2200/mo due to that asset's value rising at about 15% per year. If it wasn't for the fact that I live here, I'd be divesting a lot of my investment in that obvious bubble ASAP. Similarly, my parents built my childhood home nearby in '96 for about $80k, their property is now worth about $750k, you do the math.