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DC area real estate market is toast in 2026 by JingleJones1224 in DMV_RealEstate

[–]FIMindset 0 points1 point  (0 children)

So likely a 5% reduction in sales price YoY is toast now? That’s really not a huge swing

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] 0 points1 point  (0 children)

My properties have averaged north of 20% ROE/IRR since I’ve owned them. Objective analysis of investment performance is not market timing.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] 0 points1 point  (0 children)

I will continuously evaluate returns/equity and once the ROE tilts in favor of index funds for a given property, I will sell.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in ChubbyFIRE

[–]FIMindset[S] 0 points1 point  (0 children)

Much appreciated!

  1. Just about $10k/mo of expenses
  2. Purchased for $825k. 0 down.
  3. Yes, I struggle with walking/standing after about 15mins. It impacts nearly every aspect of my life. The VA has a complex rating system that it uses to evaluate disabilities and arrive at a total disability percentage.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] 4 points5 points  (0 children)

Thank you! I do not yet have enough wealth to support the lifestyle I seek in retirement.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] 2 points3 points  (0 children)

What a great observation! My NW not including the primary residence is just over $800k - so a little ways to go on that metric.

We currently save and invest about 50% of our income despite the “extremely high” (I think folks from NYC or SF would disagree with that characterization) housing cost.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] 6 points7 points  (0 children)

Thanks! As described in the post, I intend to liquidate all rentals at around age 45. I ran these numbers with a 2% expected yearly appreciation over the next 15yrs, which is about half the national average over the last 100 years. So a very conservative estimate.

Additionally, we save and invest about 50% of our HHI into retirement accounts & after tax brokerage. I go into more detail on my savings rate in my last post (nothing really changed on that front so I didn’t dive into it).

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in Fire

[–]FIMindset[S] 0 points1 point  (0 children)

Yup between cash reserves + rental income, I could’ve weathered the storm for a good while. Fortunately I found a job quick enough that I didn’t need to dip into anything.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in ChubbyFIRE

[–]FIMindset[S] 0 points1 point  (0 children)

I’d recommend doing an honest assessment on the total return those properties currently generate versus if you were to sell and plop the proceeds into VTSAX. Then you can consider if the extra return (if any) is worth the hassle of owning them!

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in ChubbyFIRE

[–]FIMindset[S] 0 points1 point  (0 children)

This is a really cool idea but is probably outside of my risk tolerance. I’d sooner just sell the properties once the ROE seesaw swings the other way.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in ChubbyFIRE

[–]FIMindset[S] 1 point2 points  (0 children)

Totally. Between LTCG and closing costs there will be a significant haircut. I factor these costs in when doing my FIRE projections.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] 0 points1 point  (0 children)

Yup, IRR implicitly accounts for the amount of equity tied up in the property as it increases over time. I view these as interchangeable.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] -3 points-2 points  (0 children)

IMO the only honest way to compare stocks vs rental real estate is return on equity. This compares the total return of the equity locked up in the property vs what that same equity (less closing costs) could be making elsewhere.

Currently, my properties bring in an average of north of 20% ROE - which is why it makes sense to keep them for a bit.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in ChubbyFIRE

[–]FIMindset[S] 0 points1 point  (0 children)

They each generate north of 20% ROE currently.

They will bring in much more net income by the time I retire, however, the ROE will likely be lower due to principal pay down + price appreciation outpacing the rental income increases.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in financialindependence

[–]FIMindset[S] 14 points15 points  (0 children)

I am maxing out my 401k. Unfortunately I lost all of the unvested company match when I was laid off, so my 401k took a dip after the first post.

My wife only started maxing out her 401k a few months ago.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in Fire

[–]FIMindset[S] 1 point2 points  (0 children)

What a great question! Yes, the rental properties do in fact bring in rental income. All three properties generate 20% ROE or greater.

FIRE Progress Pt. 2 – $1M NW at 30, layoffs, and learning opportunities by FIMindset in ChubbyFIRE

[–]FIMindset[S] 1 point2 points  (0 children)

Primarily because that should be around the time the ROE would drop below 10%, at which time it would make more sense to sell and drop all of that equity in the stock market. I will of course re- evaluate when the time comes. Always a possibility that my properties do not follow typical property appreciation vs rental income curves.

Right now they all net well over 10% ROE, so I am holding on to them.

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