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Elon Musk announces he is selling his last remaining home

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Billionaire CEO Elon Musk announced on Monday that he was selling his last home, a little more than a year after saying he was working to sell 'almost all physical possessions.'

Billionaire CEO Elon Musk announced on Monday that he was selling his last home, a little more than a year after saying he was working to sell ‘almost all physical possessions.’

A little more than a year since his vow last May to sell nearly all of his possessions, and ‘own no house,’ billionaire CEO Elon Musk appears to be nearing his goal, announcing Monday that he plans to sell his last remaining home.

The California Bay Area mansion, which was listed for sale on Sunday for $37.5 million, is on Crystal Springs Road in Hillsborough, and was used chiefly as a rental space for events, he said. 

Musk said he would like to sell it to a large family who will live there. ‘It’s a special place,’ he tweeted.  

He currently lives in a home he rents worth $50,000 in Boca Chica, Texas near his Space Exploration Technologies Corp. Starbase rocket manufacturing plant, where he moved last year. 

Musk had gone on a spree the past 13 months, selling six of his properties, as well as one in 2019, for a total of $114 million.

He tweeted last May: ‘I am selling almost all physical possessions. Will own no house.’ 

He said he was doing it as a way to defuse criticism of his wealth, telling podcast host Joe Rogan last May: ‘I think possessions kinda weigh you down. And they’re kind of an attack vector. People say, “Hey, billionaire, you got all this stuff.” “Well, now I don’t have the stuff — now what are you gonna do?”‘ 

The announcement that Musk is selling his mansion on Crystal Springs Road means he has nearly rid himself entirely of his properties in California

The announcement that Musk is selling his mansion on Crystal Springs Road means he has nearly rid himself entirely of his properties in

Typical for Musk, he made his announcement in an early Monday tweet

Typical for Musk, he made his announcement in an early Monday tweet

It was a final make-good for a vow he made last May

It was a final make-good for a vow he made last May 

The announcement comes after a ProPublica report last week that revealed he had paid little, and in some cases, no federal income taxes in recent years. 

Musk said on Wednesday that despite divesting himself of his properties in the state, he would, ‘continue to pay income taxes in California proportionate to my time in state, which is & will be significant.’ 

Musk started his sell-off in June 2020, with a 20,200-square foot mansion in Los Angeles’ Bel Air area that sold for $29 million.

It featured a library, fruit orchard, five-car garage, guest suite, theater, and ocean and city views among many other amenities, according to its Zillow listing. 

He purchased it in 2013 for $17 million.  

Then, in October, Musk sold a home near the mansion that he said was particularly special to him because it formerly belonged to Gene Wilder.    

After more than a year of divesting himself of his various California homes, Musk said he finally decided to sell his Bay Area mansion in Hillsborough (pictured above)

After more than a year of divesting himself of his various California homes, Musk said he finally decided to sell his Bay Area mansion in Hillsborough (pictured above) 

Musk said he chiefly rents the mansion, also pictured, out for events and would like to sell it to a large family that plans to live there

Musk said he chiefly rents the mansion, also pictured, out for events and would like to sell it to a large family that plans to live there

The mansion is currently listed for $37.5 million

The mansion is currently listed for $37.5 million 

He stipulated: ‘It cannot be torn down or lose any of its soul.’ 

He bought the property in 2013 for $6.75 million, and sold it to Wilder’s nephew Jordan Walker-Pearlman for $7.2 million.

Musk even helped finance the purchase by giving him a loan, Variety reported.

In December 2020, Musk sold four neighboring homes in Bel Air for a combined $61.8 million.  

Musk began his grand sell-off with a 20,200-square-foot mansion in Bel Air for $29 million in June 2020

Musk began his grand sell-off with a 20,200-square-foot mansion in Bel Air for $29 million in June 2020

Then, in October, 2020 Musk sold a house he owned that had been formerly inhabited by actor Gene Wilder. He stipulated: 'It cannot be torn down or lose any of its soul.'

Then, in October, 2020 Musk sold a house he owned that had been formerly inhabited by actor Gene Wilder. He stipulated: ‘It cannot be torn down or lose any of its soul.’

He had told Rogan in 2018 that he only actually lived in one of them, and purchased three as privacy buffers.   

They included a two-story, six-bed, seven-bath house on Somera Road that went for $29.7 million; a two-story, six-bed and eight-bath on Chalon Road for $21 million; a two-story, four-bed, five-bath on Somera Road for $6.7 million; and a single-story, four-bedroom, four-bath home on Somera Road built in the 1960s that appears to have not been renovated since for $4.4 million.    

Before those, however, Musk sold his first major California property in August 2019.

It was a three-bedroom, three-bath modern house in Brentwood that he initially purchased in 2014 for $3.7 million. 

It featured floor-to-ceiling windows and a salt-water pool.  

He would sell it for $4 million.

That leaves the Hillsborough mansion, which is set apart from the other homes by its geographical location just south of San Francisco. 

In December, 2020 Musk sold four Bel Air homes for a combined $61.7 million. They included this Somera Road property for $29.7 million

In December, 2020 Musk sold four Bel Air homes for a combined $61.7 million. They included this Somera Road property for $29.7 million 

Musk also sold this Somera Road colonial house for $6.7 million

Musk also sold this Somera Road colonial house for $6.7 million 

This Chalon Road home was sold for $21 million. Musk said he only lived in one of the four properties, and purchased the other three as privacy buffers

This Chalon Road home was sold for $21 million. Musk said he only lived in one of the four properties, and purchased the other three as privacy buffers 

Musk also sold this Somera Road house for $4.4 million. It was built in the 1960s and has apparently not been renovated since

Musk also sold this Somera Road house for $4.4 million. It was built in the 1960s and has apparently not been renovated since 

Before his vow to sell all of his properties, Musk sold this Brentwood house in August 2019 for $4 million

Before his vow to sell all of his properties, Musk sold this Brentwood house in August 2019 for $4 million

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Could equity release be used to help more younger homebuyers?

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Younger first-time buyers could be given more financial help from the Bank of Grandma and Grandad, through the use of improved equity release products, a new report suggests.

The document written by Tom McPhail, of consultancy The Lang Cat, claimed that younger buyers are missing out because older members of their family are unable to satisfactorily tap into their property wealth.

Mr McPhail said: ‘Releasing some of the equity in a property means older homeowners can choose when and how they share their wealth with younger generations.

‘An equity release by grandparents of say £20,000 now, could be transformational for a 20 something struggling to raise a deposit and get on the housing ladder but would make only a very modest dent to the value of the grandparent’s house.’

Releasing some of the equity in a property means older homeowners can choose when and how they share their wealth with younger generations, says new report

Releasing some of the equity in a property means older homeowners can choose when and how they share their wealth with younger generations, says new report

The report acknowledged that equity release has endured a poor reputation in the past after customers suffered ‘severe’ financial knocks.

The sector has been criticised for encouraging people to take on debt, particularly later on in life.

There has also been other concerns about equity release, such as customers falling into negative equity where the value of a property is less than the loan taken out against it when house prices fall.

The report suggested that while the equity release sector has since begun to put ‘its house in order’, it is ‘still not perfect’ and some regulatory safeguards need to be strengthened.

It called for several issues to be looked at, including early redemption charges on equity release products.

It said that most providers apply a simple sliding scale of charges, for example 10 per cent in year on to 1 per cent in year 10.

However, it claimed that some providers apply an early redemption charge based on prevailing gilt rates at that time, putting customers at an ‘unfair disadvantage’.

This is because the fees are not transparent as there is no way a customer can know in advance whether they’d be liable for a charge and if so, how much. 

In the past, customers have also fallen foul of the small print on their equity release loans when it comes to early-redemption penalties – such as couples who must pay an exit fee unless both of them need to go into care.

The report also raised questions about interest rates on equity release products. It said providers should be consistent with their lending criteria and not move the goalposts after customers have taken out a loan, as this can make it harder for them to access a top-up loan in the future, potentially forcing them to remortgage. 

Equity release products could help people access their property wealth to help younger members of their family onto the property ladder

Equity release products could help people access their property wealth to help younger members of their family onto the property ladder

The report argued that equity release products could help people access their property wealth to help younger members of their family onto the property ladder.

Mr McPhail added: ‘Raising a deposit has become an increasingly significant barrier to getting on the housing ladder, with increasing numbers of first-time buyers having to rely on financial help from older generations.

‘Releasing some of the equity in a property allows older homeowners to choose when and how they share their wealth with the younger generation.

‘This more targeted approach gives them greater control to use their assets to the maximum benefit at the point of need.’

Raising a deposit is a barrier to getting on the housing ladder, with increasing numbers of first-time buyers having to rely on financial help from older generations, says the report's author Tom McPhail

Raising a deposit is a barrier to getting on the housing ladder, with increasing numbers of first-time buyers having to rely on financial help from older generations, says the report’s author Tom McPhail

Equity release: How it works and advice

To help readers considering equity release, This is Money has partnered with Age Partnership+, independent advisers who specialise in retirement mortgages and equity release. 

Age Partnership+ compares deals across the whole of the market and their advisers can help you work out whether equity release is right for you – or whether there are better options, such as downsizing. 

Age Partnership+ advisers can also see if those with existing equity release deals can save money by switching. 

You can compare equity release rates and work out how much you could potentially borrow with This is Money’s new calculator powered by broker Age Partnership+.* 

 * Partner link

Jonathan Harris, of mortgage broker Forensic Property Finance, said: ‘Equity release has historically been viewed as a ‘murky’, high-risk sector, fuelled by minimal regulation, poorly-qualified advisers, only a handful of lenders and extortionately high interest rates.

‘Fast forward to today and we see a dramatically transformed sector, benefiting from strict regulation, highly-qualified advisers, multiple lenders and access to very competitive interest rates. 

‘Not surprisingly, equity release is now a viable and growing market for older borrowers looking to utilise the gains seen on property prices to bolster lifestyles, as well as pass on wealth to children when they need it.

‘Those considering equity release should make sure they understand the implications and involve family in any decision-making. It is always important to seek advice from suitably-qualified advisers.’

It comes as a separate report by Legal & General suggested that one in every £90 spent by retired Britons is funded by equity release.

It said that equity release funded an estimated £3billion in retirement spending last year, although it didn’t mentioned the money going to younger generations towards buying a property.

Instead, the report’s survey of 2,000 homeowners found that those with equity release have most frequently used the product to finance home improvements, at 26 per cent.

It said equity release is also being used to support costs such as medical expenses at 17 per cent, maintaining living standards in retirement at 16 per cent, and paying off personal debt at 16 per cent, for example paying off interest-only mortgages. 

It suggested that equity release is likely to play an increasingly important role in financing care-related expenses, with 19 per cent of prospective homeowners citing it as a consideration.

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Allianz Real Estate buys prime office building in Rome (IT)

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Allianz Real Estate, advised by Dils, has acquired an office property in the centre of Rome. The transaction, worth circa €175m, is one of the most important to have been carried out on the real estate market in Rome in recent years.

 

The building, consisting of eleven storeys, comprising nine above-ground and two underground, has a gross lettable area of circa 22,000m² and has undergone a major refurbishment, offering the highest environmental sustainability and energy efficiency standards (LEED Gold Certification). The strategic location, between the CBD and Termini Station, is enjoying great success, especially among corporate occupiers. 

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NCC sells Valby office scheme (DK)

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NCC is selling Kontorværket 1 office project in Valby, Copenhagen to Industriens Pension. The building will become biotech company Genmab’s new headquarters and will meet high environmental standards for both the building and the area. The transaction will be conducted as a company divestment, based on an underlying property value of approximately €81.9m (SEK875m). Transfer of the project and payment of the purchase consideration is expected to result in a positive earnings effect in the NCC Property Development business area in the first quarter of 2023.

 

“We are now selling Kontorværket 1, the first phase of our development project in Valby in the central parts of Copenhagen. Here we have developed property with an optimal infrastructure and appealing architecture, and I am pleased that Industriens Pension is now taking over,” said Joachim Holmberg, Business Area Manager, NCC Property Development.

 

Kontorværket 1 encompasses 16,000m² of lettable area and also includes a basement featuring a parking garage next to the building, with space for 280 vehicles and facilities for parking bicycles.

 

“This is an attractive and future-proof office property, located in an area with very good infrastructure, a motorway, a nearby metro and S-train station. The 15-year lease with Genmab fits well with our strategy as a long-term owner, and we expect the property to contribute a stable return for our members for many years to come. We look forward to welcoming Genmab’s experts in biotechnology,” said Soren Tang Kristensen, Head of Real Estate Investments, Industriens Pension.

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