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Old 05-25-2014, 12:13 PM   #21
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My husband has a classmate who is really into old cars. He purchased a building that looks like it was either a small warehouse or large garage, cleaned it up and it is now not only a shop but a magnet for his old-car-buddies.

Before you buy a bigger house look around in your community for such a structure. Former small manufacturing buildings may be a better use of your money.
I like this. It might even make your tax situation easier/better, and obviously you avoid all the real estate transaction costs on top of all the other pitfalls noted already.
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Old 05-25-2014, 01:20 PM   #22
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This reminds me to go clear out my 2 car garage to have room to park in it. more space = more junk. I wish I had a smaller house right now.. more time to travel.

Oh, and how can you make 300k+ and still be in debt? wow.
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Old 05-25-2014, 03:12 PM   #23
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If you're making $300K per year and living conservatively, a $500K house is a very modest investment for you. And if you think it's a good location and has potential to appreciate in value, then it may be a good investment too. You can own all the stocks and bonds you want, but you can't live in them. If the two of you would enjoy the house, I say go for it.
I'm inclined to agree.
But be sure about the size. Is it reasonable for the neighborhood?
I have a neighbor with a very large house (several times the size of the next biggest one nearby). He has been trying to sell it for nearly five years now. As long as you're not in that kind of situation, I think you might be wise to get the one you're looking at. Sounds as if you'd really enjoy it.
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Old 05-25-2014, 03:43 PM   #24
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Hey, buy a new bigger place. You only live once.

Ha
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Old 05-25-2014, 05:45 PM   #25
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Hey, buy a new bigger place. You only live once.

Ha
+ 1...if you can afford it go ahead. You can always sell it.

Or buy a bigger car....because when times are hard you can always sleep in your car...but you can't drive your house!
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Old 05-25-2014, 06:34 PM   #26
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Count me in the group that says go for it!!
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Old 05-25-2014, 08:58 PM   #27
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Thanks for all the responses. We went to that open house today - really nice house and great garage space but the spouse didn't like the lot nor the street. We may just stay put for a while anyway. I keep getting stuck on the costs of the move itself: 6% realtor fee from selling my house, paying a moving company, new furniture and window treatments, etc, etc. All that really adds up.
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Old 05-25-2014, 09:01 PM   #28
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This reminds me to go clear out my 2 car garage to have room to park in it. more space = more junk. I wish I had a smaller house right now.. more time to travel.

Oh, and how can you make 300k+ and still be in debt? wow.
Not really in debt, just have a good interest rate on my mortgage. If I really wanted to, i could sell some stock I own and pay off the house next week.
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Old 05-25-2014, 09:01 PM   #29
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Well, consider my suggestion of looking for a warehouse space to fix up. You could always lease it with tenant improvements paid by the lessor.
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Old 05-25-2014, 10:09 PM   #30
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Well, consider my suggestion of looking for a warehouse space to fix up. You could always lease it with tenant improvements paid by the lessor.
I have given that some thought. A buddy of mine has quite the collection of motorcycles. He rents a 2000 sq ft industrial space and uses it for storage and man cave.
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I would do it differently, if I were to do it again.
Old 05-26-2014, 12:20 AM   #31
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I would do it differently, if I were to do it again.

Here is my story:

2008-2009 is here and I discuss with the wife that if we are ever going to move into our dream home now is the time to do it with all the foreclosures, prices of housing falling, etc.

Some background: we had 4 kids at home at that time, the oldest was 19 and the youngest 9. The house was one that we had built with a home builder that built full neighborhoods of 10-50 houses. We built in 1997 and it was about 2400sq ft, technically 5 bedrooms, 2 car garage on a oddly shaped 1/3 acre.

My wife and I looked for almost a year till we found our 'dream house'. It was a bank buy back and was having construction finished on it as we found it. Two perpendicular two car garages, with one of them extra large (you could fit 4 compact cars in it front to back), 3/4 of an acre lot, 3681 finished square foot and 3264 unfinished basement with theater room, vaulted ceilings, lots of windows, master walk in closet is as big as one of my kids room in the old house.

We rationalized it as we deserved it, it would be an investment when housing rebounded, we can finish the basement and rent it out back to one of the kids, lots of plans. We bought it in 2009 about $15k less than the second offer that came in on it (the bank had already accepted our offer).

Well here it is 2014, basement still unfinished, still haven't furnished one of the rooms, heating and A/C are horrible, more than double what I was used to (I knew they would go up but seeing a $700 electric bill in the summer is still mind boggling). The electric company probably thinks we are growing pot in the basement because they send us comparisons of nearby similar houses and we are easily double the kilowatt hours.

Oldest two kids are out of the house, 3rd kid is turning 18 in a few months and might also be out soon, youngest is starting 10th grade, not too many years left either. I now talk to my wife about downsizing, ramblers, not a lot of stairs, etc. I think 2000 sq ft main level and similar sized basement would be perfect. Maybe in about 10 years.

So would I do it over again if I know what I know now? No. I feel that my FIRE has suffered a little, we definitely didn't save as much as we were in the past after buying this behemoth. I'm not saying I wouldn't have moved, but not to such a large place with kiddies leaving the nest. Now I'm thinking how small we can downgrade so they don't come back

If I were in your position I would look for a similarly sized house on more acreage so you can have your own garage built the way you want it, maybe with a living space over the garage

I guess the good thing for us is that Zillow (the bible of home values, ha ha) has our house showing a $350k+ increase in value from when we bought it. Maybe it will be $500k+ by the time we sell and we can pay cash for the downsize (see it was an investment).
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Old 05-26-2014, 07:34 AM   #32
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Thanks Ronnieboy. Sounds very similar to my situation. I also kicked around the idea of buying the dream house when the market collapsed but didn't pull the trigger. Sounds like you may be in great shape long term.

The thought of a $700 electric bill is wild. My current house maxes out at around $350 in a hot summer month with the AC going every day. I thought that was painful! I think the house we looked at had two HVAC units, one downstairs, one upstairs.

Good thought on possibly buying a smaller house with some land. I actually like the idea of maybe a 2000-2500 square foot ranch instead on a few acres and then build a pole barn/workshop on the property.
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Old 05-26-2014, 11:29 AM   #33
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Honestly, not sure how much longer you plan to work and what your financial situation is, but if you are making 250k and you are going to enjoy what the house has to offer and most importantly the location, then I say go for it. Assuming you plan to live there for many years. I personally would rather have a smaller house, while still in a good location. To keep costs and taxes down, but I would most likely not want to spend the majority of my time at the house.
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Old 05-26-2014, 01:01 PM   #34
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Keep in mind that, if you choose, while you can always later sell the larger house, that larger homes are much less liquid than smaller ones. I have two friends with large homes they would rather not have.

One built a very large, I would term mega-home he built when he sold his company and retired (after the financial crisis he had to go back to work). He recently told me that he would like to move into a more affordable home, but there are so many homes in his neighborhood on the market now. Everyone who did not have to sell during the financial crisis, and was waiting for house prices to rise, now have their homes on the market. And while low cost houses sell quickly, those in his area remain on the market for a long time.

Another friend with a large home, unexpectedly got laid off. Rather than proud of their expansive overly fancy digs, they seem to be a bit envious of their more frugal relatives that have smaller and paid off homes. They plan to sell eventually too. Where they will put all their furniture I don't know.

Maybe means you can get some really big homes cheap, but then again they are hard to move for a reason, that upkeep.

Just my two cents...
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Old 05-26-2014, 01:40 PM   #35
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Keep in mind that, if you choose, while you can always later sell the larger house, that larger homes are much less liquid than smaller ones. I have two friends with large homes they would rather not have.

One built a very large, I would term mega-home he built when he sold his company and retired (after the financial crisis he had to go back to work). He recently told me that he would like to move into a more affordable home, but there are so many homes in his neighborhood on the market now. Everyone who did not have to sell during the financial crisis, and was waiting for house prices to rise, now have their homes on the market. And while low cost houses sell quickly, those in his area remain on the market for a long time.

Another friend with a large home, unexpectedly got laid off. Rather than proud of their expansive overly fancy digs, they seem to be a bit envious of their more frugal relatives that have smaller and paid off homes. They plan to sell eventually too. Where they will put all their furniture I don't know.

Maybe means you can get some really big homes cheap, but then again they are hard to move for a reason, that upkeep.

Just my two cents...
Don't worry, when the housing bubble inflates again, there will be buyers for the mega homes and banks to lend money to anyone who wants it. This is America, remember?
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Old 05-26-2014, 03:08 PM   #36
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Rent a separate garage. You can work on your cars and hang out with your buds. Who needs a 4000 square foot house?
+1 and who needs more furniture
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Old 05-26-2014, 04:16 PM   #37
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Do whatever makes you happiest. You're cognizant that you are trading a certain number of years of freedom (ie; retirement) for more space and more room for your hobbies, and that with more space there is increased risk of more stuff which exacerbates the trade-off.

As for me, I would live with less or rent a hobby garage.
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Old 05-26-2014, 04:47 PM   #38
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If not rent or buy a hobby garage then buy a modest home where you can build a separate garage or outbuilding for your hobbies. Realize that the chance of recovering the cost of the outbuilding is small so don't put a lot of $ in its construction.
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Old 05-26-2014, 04:49 PM   #39
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Now, I'm not a technical kind of person, butwhen we decided to retire @ 53, (with not quite enough money)... our first "home" was a park model trailer in a campground... Thats a 12' x 34' mobile home, (400sf) and an add a room (400sf). Not a decision to be made lightly. "Could we live in 800sf?" ...

Well of course... forced to, we could live in a tent. Coming down from a 2500sf home, though, presented a real question, so making the decision was done this way. Independently, DW and I challenged each other to keep track of how much of the 2500sf we actually lived in. With the kids gone, two bedrooms freed up (except to clean). Then, the lower level family room. Very nice, but we just didn't use it except for a few days a year... parties or guests. Add to that, the staircases, the hallways and the downstairs bath... and... independently, we came up with the fact that about 95% of the time, we lived in about 650 sf. This reasoning made the change economical, and in fact made life a bit more simple and easy.

As a side benefit, the lower cost allowed us to buy our second mfg home in Florida... living 6 months in each, for the next 15 years, before buying our current 1600sf home in a senior community. It was a win-win for us... The money we saved has kept us secure as we grow older.

One great side effect of living in the campground and the mfg home community... You learn that the clubhouse takes the place of the entertianment room, and the social life is much busier and more fun where people don't become ensconced in their private mansions.

Different stroke for different folks.
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Old 05-27-2014, 02:59 PM   #40
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We may have really lost our minds now - wife found another huge house with 2 car attached garage plus a separate 3.5 car garage and it's also lakefront. Way more money but living on a lake with a huge garage workshop is the absolute dream home. Only a couple of miles from where we live now. Looking at it tomorrow night. If we buy it, I will have to retire from this forum.
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