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Tell me not to buy a bigger house
Old 05-25-2014, 09:30 AM   #1
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Tell me not to buy a bigger house

Our youngest graduates from HS next week. This gives us the flexibility to move anywhere locally without regard to schools. We like our house and neighborhood and the house is 2100 square feet so more than enough for the two of us and for when the kids visit or come home for the summer. We have a 2.5 car attached garage and no way to expand. My hobby is cars and motorcycles and I would really like to have either a 4 car garage or a home with a few acres to build a separate workshop.

Our current home is worth about 275k and we owe 100k. 15 year note with 3.8% APR. This is a very affordable home for us and I will likely be able to pay it off in 2-3 years. I love the idea of being 100% debt free.

There is an open house today for a home in the next town. $500k house, 4,000 sq ft, newer construction, 2 acres, 2 car attached garage plus a 2 car separate garage. Also is close to a very nice downtown area and a park we love.

In the traditional sense, we can absolutely afford it. I have been making 300k+ the past few years and should at least make 200/250 a year for the next few years. But in the scope of early retirement and being debt free, it's a very different question. I am very risk averse. Some would say I am nuts not to live in a nicer area with my income.

My head says you are fine where you are and if you get more garage space, you will fill it with more toys (already have two motorcycles and a sports car). I know, first world problems.
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Old 05-25-2014, 09:35 AM   #2
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So who yo gonna hire to clean the place?
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Old 05-25-2014, 09:42 AM   #3
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Wife will want to fill the new place with furniture and also not use what you have now. Think of how much hobby car you can get for that cash alone. And as is99 said, cleaning bills will rise (and taxes, utilities, etc). Plus, you will have to move and that is a royal pain in the @$$!

Keep the 2100 square foot place, go rent a garage nearby.
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Old 05-25-2014, 09:44 AM   #4
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do not buy a bigger house.
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Old 05-25-2014, 09:44 AM   #5
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Do you see yourself as a person 5-10 years down the road as one who will become resentful or annoyed with the higher property taxes, utility bills, maintenance, insurance, etc. and long for "the good old days" of when you had the 2100 sq. ft. home? Only you know what is best for you CS, so my only suggestion would be only to make sure you buy something you will enjoy instead of regret.


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Old 05-25-2014, 09:53 AM   #6
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You have to do what works for you. If your hobby is cars, maybe the larger house is better for you. Depending on your area, your house may appreciate in value and actually be a better use of your money than alternate uses like travel, with no financial ROI, or depreciating assets like a boat.

Personally, we are looking forward to a condo with more free time and less expense and upkeep of a big house. Plus we want to live some place where we can age in place and not have to relocate when we are 80.

It you want some reasons to downsize instead, here is an article advocating smaller housing -

The Righteous Small House: Challenging House Size and the Irresponsible American Dream by Jason McLennan — YES! Magazine
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Old 05-25-2014, 10:06 AM   #7
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Do what you want. I have the same hobbies but have weaned myself down to one motorcycle, two cars, an 1800 sq.ft. house (new) and about a half acre lot which is just enough that I don't mind taking care of the outside and the wife and I can easily maintain the inside. We have room for the grandkids and for socializing.

We came from a 3200 sq. ft. house and two acres with an outbuilding. We lived there for 16 years while the kids were growing up. One of the best days in my life was selling the place and downsizing. Made a pretty penny too. I found out as I grow older, less is more.
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Old 05-25-2014, 10:11 AM   #8
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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?
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Old 05-25-2014, 10:14 AM   #9
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What others think I can/not afford has never meant anything to me. I want to live in a comfortable home in a decent neighborhood, from there I want to minimize home operating costs. A bigger house means higher property taxes, higher utility costs, higher insurance premiums, higher repairs/replacement costs, etc. And more space and stuff to clean, maintain and furnish. If I was going to spend more, I'd spend on better finishes/systems - not more sqft. But that shouldn't influence anyone else.

We've voluntarily decluttered, getting rid of an incredible amount of stuff in the past few years, and made money on much of it using eBay. Things we hadn't used in years, and thought 'what was I thinking when I bought this?' It's amazing how much space we really had. And less stuff is appealing to us now. YMMV
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Old 05-25-2014, 10:22 AM   #10
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Here is another article if you want reasons to not upsize -

Avoiding The Money Pit

"There are nearly three times more millionaire households (1,138,070 versus 403,211) living in homes valued at $300,000 or less than there are millionaires living in homes valued at $1 million or more. The data strongly indicate that this ratio of "wealth-building productivity" is inversely related to the market value of one's own home as well as those of one's neighbors."
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Old 05-25-2014, 10:23 AM   #11
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Do not buy a bigger house! What Frayne and Midpack express rings true to me. I look forward to the day that I get to sell this place and move into something smaller, better, less expensive, less maintenance prone, etc, etc, ...
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Old 05-25-2014, 10:26 AM   #12
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We have a 4,000 square foot home for just the two of us, and even though it may seem large, we absolutely love it! And especially if two people go from working every day to retiring and being home all the time, I say the more space the better. It keeps the two of us sane.

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 to. 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.
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Old 05-25-2014, 10:35 AM   #13
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Originally Posted by CorporateSoldier View Post
...Some would say I am nuts not to live in a nicer area with my income.
...
It is your decision of course, I would image that most on this forum would think you are nuts to buy, but then again, why would you make your decision on what anyone else thinks is nuts?

For us, my wife and I purchased a home in 2011, with the depressed market, what we qualified for and what was on the market, we could have easily bought something new and huge. My wife wisely said, I don't want to have to take care of this thing. We chose an older smaller home, which is now paid off. So many regrets avoided, doing a little patio remodel, loving it here.
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Old 05-25-2014, 10:40 AM   #14
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I would probably go on a motorcycle ride today instead of the open house.
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Old 05-25-2014, 10:46 AM   #15
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I would probably go on a motorcycle ride today instead of the open house.
Exactly what I plan to do later today but have to hit some golf balls first and then watch the Indy 500.
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Old 05-25-2014, 10:54 AM   #16
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When I hear about people buying a house that large, I tend to think that either they have quite a few children still at home, or else they are still working and need a giant "good for me" present to themselves.

Seriously, would you rather spend money on property tax and insurance, or on something else? Would you rather spend your free time maintaining such a home, or doing something else?

If the above didn't persuade you not to buy the house, then I'd say you should buy it.

I can afford a large house, and might buy one some day. BUT - - if I could find one in the right location with the right amenities, I'd probably be much happier with one around 800-1200 square feet. I just don't need or want that much space.

Before I bought this house, I rented one that was larger. I felt like I needed roller blades just to get from the laundry room to the master bedroom.

Edited to add:
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Some would say I am nuts not to live in a nicer area with my income.
Who cares what "some" would say? Let's get out of that mentality. They aren't spending long hard hours earning your money for you. What matters is how YOU and your spouse want to allocate your money.
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Old 05-25-2014, 11:01 AM   #17
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Wife will want to fill the new place with furniture and also not use what you have now. Think of how much hobby car you can get for that cash alone. And as is99 said, cleaning bills will rise (and taxes, utilities, etc). Plus, you will have to move and that is a royal pain in the @$$!

Keep the 2100 square foot place, go rent a garage nearby.
In addition to all this, one more thing to consider. If you move into an expensive home, you will have neighbors who also have an expensive home, who spend more money. And over the years will find yourself spending more, just because that is the environment, or so you don't appear "nuts" to them.
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Old 05-25-2014, 11:03 AM   #18
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In addition to all this, one more thing to consider. If you move into an expensive home, you will have neighbors who also have an expensive home, who spend more money. And over the years will find yourself spending more, just because that is the environment, or so you don't appear "nuts" to them.
+1. 'The richer your friends, the more it will cost you'...(more often than not)
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Old 05-25-2014, 11:50 AM   #19
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You obviously won't ever have a four-car garage or acreage to build one at the home you are in, so you would have to move to get that. Maybe you can find a place with one of those (the $500k house has both) that is comparable to the cost of your current house?

Is there another reason to move--most of your post is reasons to stay in your current house. I would ignore the $$ factor in this decision as you can certainly afford it and presumably and optimistically you wouldn't lose money when you sell the bigger house one day, if you go in that direction.
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Old 05-25-2014, 11:54 AM   #20
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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.
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