{"id":867,"date":"2026-06-06T17:08:25","date_gmt":"2026-06-06T17:08:25","guid":{"rendered":"https:\/\/crosscountrymovingteams.com\/?p=867"},"modified":"2026-06-06T17:08:25","modified_gmt":"2026-06-06T17:08:25","slug":"billionaires-elon-musk-and-mark-zuckerberg-used-mortgages-to-buy-multimillion-dollar-mansions-heres-why-thats-a-savvy-financial-decision","status":"publish","type":"post","link":"https:\/\/crosscountrymovingteams.com\/?p=867","title":{"rendered":"Billionaires Elon Musk and Mark Zuckerberg used mortgages to buy multimillion-dollar mansions. Here\u2019s why that\u2019s a savvy financial decision"},"content":{"rendered":"
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Elon Musk is the world\u2019s richest man, on track to become the first-ever trillionaire (or may already be one), but he\u2019s done one thing most average Americans have to do: take out a mortgage.\u00a0<\/p>\n

Read more One in five homebuyers is a single woman \u2013 here\u2019s what\u2019s driving the shift<\/a><\/p>\n

The Tesla CEO has taken out several mega mortgages, including $61 million from Morgan Stanley, on five properties in California, according to the Los Angeles Times<\/em>. That\u2019s barely a drop in the bucket of his now-$703 billion net worth, so it could be difficult to understand why he\u2019d borrow tens of millions of dollars to buy real estate.\u00a0<\/p>\n

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But financial experts say taking out a mortgage\u2014even when you could easily pay cash\u2014can actually be a smart wealth strategy. <\/p>\n

Why wealthy buyers still take out mortgages<\/h2>\n

One of the main reasons is that most of the wealth held by UHNW people is tied up in investments, stocks, and bonds, and they don\u2019t keep as much liquid cash on hand.\u00a0<\/p>\n

\u201cUltrahigh-net-worth individuals think differently about liquidity and leverage,\u201d Miltiadis Kastanis, executive director of sales at Compass, told Fortune<\/em>. \u201cThey\u2019d rather keep their money working for them in investments, businesses\u2014or even art\u2014rather than tying it all up in one property.\u201d<\/p>\n

Meta CEO Mark Zuckerberg, the world\u2019s seventh-richest man, has also used mortgages to his advantage. In 2012, Zuckerberg refinanced his Palo Alto home with a 30-year, 1.05% adjustable-rate mortgage, according to CNBC<\/em>. With such a low rate, the mortgage cost him practically nothing, so it didn\u2019t make sense to have nearly $6 million tied up in a home. Plus, borrowing during the era of ultralow interest rates in the 2010s was especially attractive. Many wealthy buyers locked in mortgages at a much lower rate than today\u2019s.<\/p>\n

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\u201cIf they believe their investments will yield a greater return than the interest they\u2019re paying on a mortgage, it makes more sense to finance the property,\u201d Kastanis added. \u201cIt\u2019s less about the cost of the loan itself and more about optimizing where their money is placed.\u201d<\/p>\n

Mortgage interest can also be tax deductible on loans up to $750,000 for those who itemize when filing their taxes. While Zuckerberg\u2019s mortgage was more than that, he can likely deduct at least part of his mortgage interest, which further reduces borrowing costs.\u00a0<\/p>\n

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\u201cMortgages also allow for tax optimization in some jurisdictions, as interest payments may be deductible,\u201d Islay Robinson, founder and CEO of mortgage brokerage Enness Global, told Fortune<\/em>. \u201cAnd in high-inflation environments, the value of money erodes over time, making it advantageous to borrow now and repay later.\u201d<\/p>\n

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Celebrities use the same strategy<\/h2>\n

Many celebrities and wealthy buyers take the same approach. <\/p>\n

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Take Paris Hilton, who took out a mortgage on the $63 million mansion she bought from Mark Wahlberg in Beverly Hills. Hilton is estimated to be worth between $300 million and $400 million.\u00a0<\/p>\n

Read more \u2018That\u2019s the way life goes\u2019: Trump tells Knicks fans who can\u2019t afford tickets to \u2018watch it on television\u2019<\/a><\/p>\n

What\u2019s even more interesting is that she and her husband, Carter Reum, reportedly took out the loan after they had already bought the 12-bed, 20-bath home, which shows a $43.75 million mortgage with JPMorgan Chase at an interest rate of 5.25%.<\/p>\n

\u201cIt surprises many people, but it\u2019s actually quite common for the mega-wealthy to take out mortgages\u2014even when they could write a check for the full purchase price,\u201d Evan Harlow, real estate agent at Maui Elite Property, previously told Fortune<\/em>.\u00a0<\/p>\n

Tax and inflation advantages of taking out a mortgage<\/h2>\n

Another reason ultrawealthy buyers borrow rather than pay cash is that they often take out loans backed by their investment portfolios. Known as securities-based lending, these loans allow clients to borrow against stocks or other assets without selling them and triggering capital gains taxes. Large banks often promote these types of loans to wealthy clients.<\/p>\n

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\u201cRather than selling your public market investments to raise money, borrowing against your assets can allow you to stay the course on your investments, defer taxes, and free up money for other opportunities,\u201d according to J.P. Morgan. \u201cIt\u2019s a way to tap into the value of what you own while keeping your financial plans intact.\u201d<\/p>\n

Because borrowed money is not treated as taxable income under U.S. law, wealthy individuals can finance spending by taking loans against their assets without triggering income taxes. Analysts often describe the practice as \u201cbuy, borrow, die\u201d: accumulate appreciating investments, borrow against them to fund consumption, and ultimately pass those assets to heirs with a stepped-up basis that largely eliminates the accumulated capital gains tax.<\/p>\n

What everyday buyers can learn<\/h2>\n

For billionaires and everyday buyers alike, the decision ultimately comes down to how they want their money working. Is it better to lock it into a house\u2014or invest elsewhere?<\/p>\n

\u201cThe takeaway for the average buyer isn\u2019t to mimic their precise approach, but to understand the principle,\u201d Harlow said. \u201cSometimes the smartest financial move isn\u2019t paying everything off, but keeping your money flexible and working for you.\u201d<\/p>\n

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A version of this story was originally published on Fortune.com on March 9, 2026.<\/em><\/p>\n

Read more Serena Williams\u2019 secret to success is about more than talent: You have to grind \u2018every day\u2019<\/a><\/p>\n

More on luxury housing:<\/h2>\n
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  • The ultrawealthy don\u2019t house hunt anymore. They subscribe<\/li>\n
  • Inside the \u2018stealth wealth\u2019 playbook: How Silicon Valley\u2019s elite buy multimillion-dollar mansions without leaving a paper trail<\/li>\n
  • Florida\u2019s influx of rich residents is killing the middle class and housing market<\/li>\n<\/ul>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

    They \u201cthink differently about liquidity and mortgage,\u201d real-estate sales director tells Fortune.<\/p>\n","protected":false},"author":1,"featured_media":866,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[195],"tags":[],"class_list":["post-867","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mortgages"],"yoast_head":"\nBillionaires Elon Musk and Mark Zuckerberg used mortgages to buy multimillion-dollar mansions. 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