Lake House Investment: To Sell or Not to Sell Amidst Rising Value

A couple who purchased a lakeside home for $700,000 in 2012, which is now worth over $1.2 million, is considering selling to avoid capital gains taxes. The couple has reached the $500,000 married-couple limit for the exclusion of capital gains. While the husband wants to sell and restart the exclusion on a new home, the wife is determined to stay. The husband is concerned that if they stay and eventually need to sell due to declining health, they could face a large tax bill if home prices continue to rise. The advice given is to weigh the pros and cons of staying in the home from a lifestyle perspective and consider factors such as proximity to medical facilities. From a financial standpoint, selling may save on capital gains tax in the long run, but there are also costs associated with moving. Ultimately, the decision should consider both financial and personal preferences.