Should I buy a new house?

[Retired Expat]

Totally torn. I like my home but one recently came on the market in a nearby area that I love! Right on the lake, larger than my current but with a separate Guest House that could be rented out and definitely more conducive for guests than the small guest room with shared bath we have now.

The cost is about $250k more than my current so I will need to draw that from investments. About 8% of my Net Worth not counting primary residence. I made almost double that in the markets this year.

Of course I am financially “conservative” (read that as cheap). But people talk about moving investments into cash all the time and forgo income and growth for security. Can a house be considered a similar thing? Historically house values here don’t change by much, up or down so the likely hood is it will all come back at some point.

Additionally the house is better configured for us as we age and the idea of sailing or kayaking and sitting by the water is making me crazy excited.

Any suggestions?

BTW: Running Firecalc with reduced investment savings is 100% it seems.. logically it all works, but the idea of spending a big chunk of money is anathema to me. Also having finally gotten my home renovated and how I like it, this will be another project as it needs a new Kitchen and bath, as well as other upgrades and decorating, plus the hassle of moving.... may just be laziness on my part and general inertia.....

 

[street]

It would be a tough decision, being frugal and saving all our lives and now dishing out 250K for a home. I get the dilemma!

On the other hand if you can afford it and it isn't going to run you short in retirement then I would buy it. You always still have that investment in that home so you could always sell and hopefully get your money back out.

 

[Ronstar]

...the idea of sailing or kayaking and sitting by the water is making me crazy excited.....

I think this says it all. You only live once. And the clock is ticking. Buy the house.

 

[Sarah S]

If you can afford it without jeopardizing your future allowing for the what ifs then it becomes a personal choice

From what you have said the pros are a better lifestyle now and a more workable home as you age. The cons are the work and stress or the moving and selling process

I moved to a more expensive living situation 18 months ago. I am much happier here and consider it worth every penny

 

[HarveyS]

Buy and enjoy!

 

[Stormy Kromer]

If you found out right now that the house was sold and no longer available would you be disappointed ? If so, I think you should buy the house. You can obviously afford it and would just be trading one asset for another while you own the house.

 

[jerryo]

Why wouldn't you buy it? You want it. You can easily afford it. It doesn't reduce your assets, but just changes how they're distributed. What's the downside

 

[jazz4cash]

I’d go for it.

 

[GenXguy]

Since you're in doubt, I wouldn't do it, unless you become certain of that decision on your own, not because of what others tell you that you should do. It's too big of a move and expense when you're that torn about doing it.

 

[ivinsfan]

If you found out right now that the house was sold and no longer available would you be disappointed ? If so, I think you should buy the house. You can obviously afford it and would just be trading one asset for another while you own the house.

OTOH my take is if the OP has to come here and ask us perhaps it's a lovely idea, but not buying wouldn't break his heart either. He apparently has a partner and if he and the partner aren't both over the moon about the idea, it's probably a non starter.

 

[LiveBelowMeans]

We can hear it in your post that you want to buy it. You have the money. All of your hard work has put you in a position to make this happen. Go for it.

 

[enjoyinglife102]

What's it all for if you can't enjoy the life you want to live? If the numbers work for you, buy the house.

 

[DenverCraig]

Based on all of the information you've supplied there is no reason to not do it. Good luck!

 

[W2R]

I love that it is configured better for you as you age.

I bought my "Dream Home" five years ago, even though I already had a reasonable home, and have never regretted doing this for one minute. Like yours, my Dream Home is better suited to the elderly or disabled than my previous home. In addition it has a few features I have always wanted; a big garage, a laundry room, a bigger shower, and a better neighborhood. Plus, as icing on the cake, it is right next door to F. Once I bought this house, sold the previous one, and added in closing costs, moving expenses, and the cost of some improvements I wanted (grading and landscaping), the net cost was $92,603. I took it from my taxable retirement savings since my retirement was a bit overfunded. I was glad that I bought it and plan to never move again. Every morning when I awaken I realize where I am, and I am so glad to be living in this house.

So yes, if you are sure that this is your Dream Home, then I think you should go for it.

 

[Big_Hitter]

blow that dough!

 

[Spanky]

Buy and have fun!

 

[Retired Expat]

Thank you all!

As most of you said, why not? We can afford it, and we would be sad if we missed the opportunity. Starting to do the Inspections next week. System here is a bit different in that there are no home inspection firms so you have to do that first using various contractors and I am a construction professional so can do much of it myself. (not really comfortable in assessing thatched roofs or 220V systems with no neutral) You then make your offer predicated on what you find.

What was helpful was the reinforcement from some folks here of what I already knew, in that it is really just a change of asset and not a Blow That Dough moment. But always helpful to hear it from someone else.

This really is a wonderful forum and I greatly appreciate all the various postings and views expressed.

Thank you one and all!

 

[Scuba]

As most of you said, why not? We can afford it, and we would be sad if we missed the opportunity. Starting to do the Inspections next week. System here is a bit different in that there are no home inspection firms so you have to do that first using various contractors and I am a construction professional so can do much of it myself. (not really comfortable in assessing thatched roofs or 220V systems with no neutral) You then make your offer predicated on what you find.



What was helpful was the reinforcement from some folks here of what I already knew, in that it is really just a change of asset and not a Blow That Dough moment. But always helpful to hear it from someone else.



This really is a wonderful forum and I greatly appreciate all the various postings and views expressed.



Thank you one and all!

DH and I just did something similar. We decided to leave our long term home and rented it out to a tenant, and bought a place in the desert that we love. Moved here 3 months ago and it’s a great fit for us. We are going to spend a huge amount of money renovating it, but decided as you have that we can afford it and we’ll love it even more here if we have a beautiful and comfortable home that we’re excited to live in. Good luck and enjoy your new home!

 

[DrRoy]

I wouldn't think of it as an investment because you would never sell it to live off of, but it still sounds like it is worth it from a quality of life viewpoint. We decided not to go through with a plan to build a dream house that could have gone to $750K, and are doing several projects to our current house for about $140K. The biggest portion is done and we love it, some others are in progress, and the last of it will be done by summer.

 

[RunningBum]

I wouldn't think of it as an investment because you would never sell it to live off of, ...

If you had to you could. Not all of it, because you have to leave somewhere, but you could certainly downsize. It probably shouldn't be part of your plan, but if things go bad, it's a backup. You have to be conservative with this, because if the economy goes bad, luxury/vacation houses will probably take a bigger hit than more traditional houses.

 

[Retired Expat]

Should I buy the house?

If you had to you could. Not all of it, because you have to leave somewhere, but you could certainly downsize. It probably shouldn't be part of your plan, but if things go bad, it's a backup. You have to be conservative with this, because if the economy goes bad, luxury/vacation houses will probably take a bigger hit than more traditional houses.

Actually this is one of two homes. I don’t really consider either a vacation home as we are trying to ultimately split our time evenly between them. Being some 6000 miles apart and always at opposite season it is not a “Let’s go up to the country house next week” kind of situation.

At some point age, finances, or general inertia will likely make us choose one or the other and that money will all comeback. Most would not be willing to handle the travel involved but as I was constantly flying during my career, I get pretty antsy after a few months not being on a plane. Hopefully I will get over that!

Fortunately DW loves the travel and had a similar career and life.

 

[38Chevy454]

I'm a little late to the party, but I agree that you should buy it since you can afford to and it will be a nice home for longer term. It is also what makes you happy, and that is part of retirement that counts - to be happy and enjoy the fruits of your labor over the years.
I upgraded our house in retirement to one approx 2x the cost. Although we also moved 1500 miles cross country in the process. The new house has all the things we want and enjoy. Even if a bigger chunk of net worth, the remaining portion of savings is enough to have the std of living we want. So my recommendation is to buy the new house. Sure moving is a PITA, but it's over quick enough and then you are set.