It does not matter how much money you make, if your home is a “liquidity trap”, you will have to sell or it will be forever a drag.
Queen Elizabeth ll is having some serious cash flow issues due to the crumbling palaces the Royal family owns. This is a common problem I see regularly in my practice with old properties. Just last week, a young couple came in with huge debt issues mainly caused by their 100 year old heritage home. The woman cried when I mentioned that the home is too much of a burden on their finances and they would never be able to get ahead financially if they did not stop the bleeding now. If you add the risk of home prices falling with the rise of interest rates, you have a foreclosure and bankruptcy situation looming. “But I bought this house with the money my mother left me when she died” she said. I almost cried with her. Those who know me, know how easy it is for me to shed a tear or two especially when I totally understand how difficult it will be for her to part from her dream home. But really, Mom would want you to make the best decision, I told her.
Old homes are too often money pits. They require maintenance galore, forever. Do your due diligence before buying an old house and after making your estimations on ongoing costs, double them. You need a large and secure cash flow to sustain an old house. Make rational decisions and avoid getting in the romantic feeling of owing a beautiful but onerous old home.