Karzai was due to settle down in the vast new property very close to the presidential palace - fuelling speculation that he intends to play an active role in the country's politics when he leaves office.
But he has changed his mind and decreed that the property would be more suitable as an official guesthouse for foreign dignitaries and other visitors travelling to Kabul to meet the next president.
Karzai's new domestic arrangements emerged as his two potential successors remain at loggerheads over who won the June 14 election, which has been engulfed in allegations of massive ballot-rigging.
"The house that was supposed to be for the retired president is built and was inaugurated today," presidential spokesperson Aimal Faizi told AFP.
"But President Karzai has decided he will not live in this residence. It is too big and he said it was better for it to be a government guesthouse.
"He did not change his mind at the last minute. Weeks ago, he visited the project and said that it was way above the standards of life for ordinary Afghan people, so it should not be his future residence.
"He will have a normal, Afghan-type home in Kabul. It is not a newly built house, and people will soon know exactly where it is."
Karzai, 56, has been packed and ready for weeks to move out of the presidential palace, where he has lived since coming to power after the fall of the Taliban in 2001.
He has repeatedly urged poll rivals Ashraf Ghani and Abdullah Abdullah to end their stalemate, which has emboldened Taliban insurgents, weakened the fragile economy and put essential international military and aid support at risk.
"The president will leave as soon as the result of the election is announced and the new president is declared," said Faizi, who added Karzai's new home only had "a few" bedrooms.
Despite its humble scale, rigorous security measures are expected to protect Karzai, who will move into his new house with his wife Zeenat and their three children, the youngest of whom was born earlier this year.
COMMENTS (3)
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ
1714024018-0/ModiLara-(1)1714024018-0-270x192.webp)
Gr8! unfortunately politicians in India never retire.
Does Afghanistan matter, or does his big or small house matter??? He probably will live in Pakistan or the U.S. or the U.K. As all our ex-leaders do. This is the acid test for "leaders", where they stay after retiring. For many reasons it is better for them to stay out, and save their home countries of the security hassles, and people from daily protocol disturbances.
Anyone believe that Karsai hasn't stolen millions of American/foreign donations? Once he leaves office he's going to lose the protection of the Presidency and chances are good he's going to have to flee Afghanistan to save his skin. If so - doubt he really cares about his retirement house.