Esino Essentials

How We Arrived Here

The Town and the House

In 2001 thanks to the Internet and Realtor.com both Jo and I spent a lot of time looking at real estate ads online.

I looked at ads primarily for New England for a number of reasons:

Jo was in Sicily at the time and was looking at €opean places.

I would go to €ope every year to visit for a week or so (since I only earned 10 days vacation a year).  Jo had always been interested in visiting a small lake northwest of Milan called Lake Orta.

She found a house on the internet for sale at the north end of Lake Orta in the town of Omegna.  In Sept. 2001 the exchange rate was 1 € = USD 0.85.  So a € 225k house cost $192k.  The Omegna house was 500 m sq. or 5,000 sq ft. and cost € 225k.  There was a black and white sketch of it.  It even had a small enclosed garden.  So when I went over at Thanksgiving, 2001, we arranged to look at it.

It was the first €opean house we had looked at so that was a disadvantage.  In retrospect it was not bad.  It had the main rooms on the ground floor, bedrooms above, and a separate apartment on the third floor which was in very bad condition and probably hadn't been lived in for 20 years.  We decided against it but it whetted my appetite and we looked at many more on the Internet.  By June, 2002, Jo had gone to look at 5 houses in northern Italy.  By then the dollar and €o were about even so the prices did not look as good in dollar terms.  The last trip north she talked to real estate agents and told them what she was looking for.  When she returned to Sicily, an agent in Lecco had responded with what sounded good.  A week later she returned north and looked at the house.  Thanks to modern technology I was able to call her from an offshore platform in the Gulf of Mexico and talk to her on her cell phone as she rode down in the agents car from Esino Lario.  By October we had bought the house.  The pictures below are from the agency's online ad.

Early Retirement

My plan when we bought the house was to retire when I turned 59 1/2 and could draw from my retirement accounts without paying an early withdrawal penalty.

After I came over at Christmas 2002 and spent the holidays with the family here I decided it did not take much more money to move the date forward to 58 1/2.  Then I came over in November 2003 and realized the house needed someone living in it to maintain it.  I moved the time from mid 2005 to fall 2004 and over the next couple months cut that back to May 2004.  The costs of maintaining the residence in Houston and the fact that it was a good time to sell the Houston house were major considerations.  And I didn't want to spend another miserable summer in Houston.  As it turns out, it was a good summer to avoid living there.

Part of the motivation to retire early came from an article I read by Paul B. Farrell on cbsmarketwatch.com.  He wrote in early 2001 that you didn't need all the money that brokers claimed to retire.  He wrote other interesting articles including one March 25, 2004, warning of a significant terrorist event prior to the Nov., 2004, elections.  This was just after the terrorist bombings in Madrid which changed the election results there.  Based upon that article I sold 25% of my stock holdings in a one hour period in order to place myself in a less vulnerable position.  The market had had a good run up since March, 2003, so it was not a bad time to sell.

Prices

A common question from Americans is "How much does it cost to live there?"  And the general answer is "It depends."  In Houston the difference in the price of a mango at Fiesta and Randall's is easily a factor of 2.  So, much of the price difference is where you shop.  Esino is a small town with only one comprehensive grocery store where you can buy most everything except produce.  The difference between prices there and at the Bennett hypermarket in Lecco, which is comparable to a super Walmart, are sometimes 50%.  Also, comparing Italian prices to other European countries: Switzerland is much more expensive, France slightly more, Britain more, Germany about the same.  For housing the rules are much like the US: the closer to the heart of a large city, the more expensive.  The transaction costs for buying a house in Italy are high: roughly 20% by the time you pay brokers fees, notary--a lawyer licensed by the government to supervise real estate transactions and collect taxes, and real estate taxes.  Rents are comparable to similar properties in the US.  A beautiful large furnished villa in wooded country north of Milan costs about € 2,000/month.