Should we downsize?

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CPA1981
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Should we downsize?

Post by CPA1981 » Tue Dec 26, 2017 12:30 pm

Long time lurker (like, years) first time posting. I need some sage advice on the emotional and financial aspects of downsizing our home. Background:
We are a family of 3. DH is 43, I’m 36 and we have a 2 year old. We live in a large-ish city somewhere in middle America. I’m a CPA and DH specializes in real estate and we both work for large corporations and are happy in our careers. Gross income is:
Me: $108,000 base with $15-20k bonus.
DH: $112,000 base with $15-20k bonus.
Here is where we need advice. 4 years ago we built our house. It is very nice. It is a beautiful walk out ranch on a large lot at the end of a cul-de-sac that backs to a park and is a 7 min commute to work (and in a great school district). In short, it is pretty much perfect. We purchased the home for $415,000. When we bought the home, the basement was unfinished and we spent the last couple years slowing finishing it - we put about $50,000 in to it, paying cash along the way. More info on the house:
Upper level: 2,000 sq ft finished, 3 bedrooms, 2 bath.
Lower level: 1,800 sq ft finished, 2 bedrooms, 1 bath.
We owe $360,000 on the mortgage and the monthly payment is $3,000 (that includes $1,000/month for real estate taxes and house insurance so about $2,000/month mortgage/interest). We have a 20 year fixed mortgage at 3% and we are 14 months in.
And we are now considering selling our wonderful house. We wouldn’t be having this conversation if it weren’t for our neighbors selling their house earlier this year for about $700,000. They have a slightly bigger lot and a pool but the house is about the same size as ours. We talked to our real estate agent and they think that we could list our house for about $605,000 and sell for about $575,000. Agents in our city take a 7% cut (split between the buying and selling agents), plus other closing costs, and in the end would net about $165,000. With that cash out, we would then purchase a much smaller/older home. Prices for something decent are around $180-200k. So we would have to have a small mortgage but we could pay it off quickly. The only other debt we have is on 1 of our cars ($15k) and if we downsized we could also pay off quickly. The freedom of not having any debt is intoxicating to me! We could then start to max out our 401ks (currently each contributing 10%) and pump a ton of money in to savings. We could decide we like the smaller house and stay but I could see us eventually moving back in to a similar house as we have today.
I’m struggling and need advice on 2 aspects. First, the emotional side... we built our house and love it. It is ideal in almost every way. We brought our baby home to this house. And I know we shouldn’t care what others think but among our friends and family we get tons of compliments and positive feedback on our house. How does one deal with moving out of their ideal space? We haven’t mentioned it to anyone yet but I know people will think we are crazy.
Second, the financial side. We obviously have no idea what the housing market will be like in 5-10 years and it feels like we would be missing a big opportunity if we didn’t sell high in the hot market we are experiencing. But given the huge commissions and other closing costs ($60k!) I’m not sure it’s worth it. And if we end up wanting to upgrade again in 5-10 years we might have been better off just staying, right? We will have this house paid off in 19 years for sure but both DH and I are anticipating nice raises over the next few years so could pay off early. I try to abide by the “same house, same spouse, same car” methodology of building wealth so that would say stay.
Right now, I'm leaning towards staying, mainly because of the high cost of selling our home.
Thank you in advance for the feedback!

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Devil's Advocate
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Re: Should we downsize?

Post by Devil's Advocate » Tue Dec 26, 2017 1:36 pm

I would keep your home. I'm mortgage free so I understand your preference to be debt free. That being said your income is good and you obviously love the house. You are plenty young enough to sock away enough retirement cash.

IMO keep the house you love.

DA

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Pajamas
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Re: Should we downsize?

Post by Pajamas » Tue Dec 26, 2017 1:46 pm

Why would you move out of an "ideal in almost every way", "very nice", "beautiful", "pretty much perfect" house that you built and "love", and can easily afford? Especially since you might eventually move back into a similar house? :oops: :oops: :oops:

Here's my advice: Stop worrying about what the neighbors do; stop trying to time the housing market; don't put time and energy into looking for a new house, buying it, moving, and getting settled into it; don't waste money in buying and selling a house. Acknowledge that your house has become your home. If you want to expend time & energy for financial gain, do it by working instead of speculating with your home.

mnnice
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Re: Should we downsize?

Post by mnnice » Tue Dec 26, 2017 1:48 pm

Was public school part of your plan? Would a house or condo in the 180k-200k range in place you in public schools of similar quality?

If the answer is yes to both I would seriously consider it. DH and I have owned three homes in the last 20 years. The current one is the smallest and cheapest while our family is at its biggest (kids are 12 and 16). Bigger fancier house doesn’t drive happiness for us and a smaller place seems more inline with our current values.

Agggm
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Re: Should we downsize?

Post by Agggm » Tue Dec 26, 2017 1:54 pm

CPA1981 wrote:
Tue Dec 26, 2017 12:30 pm
Long time lurker (like, years) first time posting. I need some sage advice on the emotional and financial aspects of downsizing our home. Background:
We are a family of 3. DH is 43, I’m 36 and we have a 2 year old. We live in a large-ish city somewhere in middle America. I’m a CPA and DH specializes in real estate and we both work for large corporations and are happy in our careers. Gross income is:
Me: $108,000 base with $15-20k bonus.
DH: $112,000 base with $15-20k bonus.
Here is where we need advice. 4 years ago we built our house. It is very nice. It is a beautiful walk out ranch on a large lot at the end of a cul-de-sac that backs to a park and is a 7 min commute to work (and in a great school district). In short, it is pretty much perfect. We purchased the home for $415,000. When we bought the home, the basement was unfinished and we spent the last couple years slowing finishing it - we put about $50,000 in to it, paying cash along the way. More info on the house:
Upper level: 2,000 sq ft finished, 3 bedrooms, 2 bath.
Lower level: 1,800 sq ft finished, 2 bedrooms, 1 bath.
We owe $360,000 on the mortgage and the monthly payment is $3,000 (that includes $1,000/month for real estate taxes and house insurance so about $2,000/month mortgage/interest). We have a 20 year fixed mortgage at 3% and we are 14 months in.
And we are now considering selling our wonderful house. We wouldn’t be having this conversation if it weren’t for our neighbors selling their house earlier this year for about $700,000. They have a slightly bigger lot and a pool but the house is about the same size as ours. We talked to our real estate agent and they think that we could list our house for about $605,000 and sell for about $575,000. Agents in our city take a 7% cut (split between the buying and selling agents), plus other closing costs, and in the end would net about $165,000. With that cash out, we would then purchase a much smaller/older home. Prices for something decent are around $180-200k. So we would have to have a small mortgage but we could pay it off quickly. The only other debt we have is on 1 of our cars ($15k) and if we downsized we could also pay off quickly. The freedom of not having any debt is intoxicating to me! We could then start to max out our 401ks (currently each contributing 10%) and pump a ton of money in to savings. We could decide we like the smaller house and stay but I could see us eventually moving back in to a similar house as we have today.
I’m struggling and need advice on 2 aspects. First, the emotional side... we built our house and love it. It is ideal in almost every way. We brought our baby home to this house. And I know we shouldn’t care what others think but among our friends and family we get tons of compliments and positive feedback on our house. How does one deal with moving out of their ideal space? We haven’t mentioned it to anyone yet but I know people will think we are crazy.
Second, the financial side. We obviously have no idea what the housing market will be like in 5-10 years and it feels like we would be missing a big opportunity if we didn’t sell high in the hot market we are experiencing. But given the huge commissions and other closing costs ($60k!) I’m not sure it’s worth it. And if we end up wanting to upgrade again in 5-10 years we might have been better off just staying, right? We will have this house paid off in 19 years for sure but both DH and I are anticipating nice raises over the next few years so could pay off early. I try to abide by the “same house, same spouse, same car” methodology of building wealth so that would say stay.
Right now, I'm leaning towards staying, mainly because of the high cost of selling our home.
Thank you in advance for the feedback!
In your position I would not downsize.

NYCguy
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Re: Should we downsize?

Post by NYCguy » Tue Dec 26, 2017 2:00 pm

OMG. keep the house you love and raise your family. You are both making great money and can afford it. Your home value may go up or down. Don’t worry about it.
If your out-go is greater than your income, your upkeep will be your DOWNFALL.

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steadyeddy
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Re: Should we downsize?

Post by steadyeddy » Tue Dec 26, 2017 2:10 pm

I don’t understand why you built the house and finished the massive basement if you would be happy with a smaller, older home. I suspect you would not actually be happy with a smaller, older home. Just enjoy the home you have and it will be paid off soon enough.

RudyS
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Re: Should we downsize?

Post by RudyS » Tue Dec 26, 2017 2:17 pm

steadyeddy wrote:
Tue Dec 26, 2017 2:10 pm
I don’t understand why you built the house and finished the massive basement if you would be happy with a smaller, older home. I suspect you would not actually be happy with a smaller, older home. Just enjoy the home you have and it will be paid off soon enough.
Also, your employment statuses (stati?) seem pretty secure, and the city is decent so I would not worry about the housing market tanking. If you don't have to sell, you aren't actually losing anything.

123
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Re: Should we downsize?

Post by 123 » Tue Dec 26, 2017 2:18 pm

You're both doing well. Having a "Happy Home" is a major contributor to your family's sense of well being. You should stay.
The closest helping hand is at the end of your own arm.

CFM300
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Re: Should we downsize?

Post by CFM300 » Tue Dec 26, 2017 2:28 pm

With 5 bedrooms and 3 baths, you definitely have more house than you need. But it's your dream home, your backyard is a park, your commute is 7 minutes, and you're in a good school district. Your combined income is a quarter of a million dollars a year and your mortgage is less than 2x your annual income. You could live off of one income and pay off your mortgage in about four years if being debt-free is that important to you.

No way I'd move in your situation.

quantAndHold
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Re: Should we downsize?

Post by quantAndHold » Tue Dec 26, 2017 2:31 pm

CPA1981 wrote:
Tue Dec 26, 2017 12:30 pm
...
We could decide we like the smaller house and stay but I could see us eventually moving back in to a similar house as we have today.
...
If you think at all that you might move into a big house again, then just stay in the house you already love. $50k-ish to move now, then the same again to move again in a few years will put a surprisingly large dent in your savings. It would be a different story if you didn't like the house, or had gone through some sort of metamorphosis and believed in the "small house FOREVAHHHH" thinking that's trendy right now.

If you're really having trouble meeting your other savings goals, you might consider refinancing to a 30 year mortgage to get the fixed payments down. Once the cars and whatnot are paid off, and retirement savings are on track, then prepay the 30 year loan.

Goinganontoday
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Re: Should we downsize?

Post by Goinganontoday » Tue Dec 26, 2017 2:40 pm

It sounds like you want to stay where you are, but you're not satisfied with your current debt and savings. Before doing anything, I'd go over the past 3-6 months and figure out where all my money was going. I'd then set out a monthly/annual budget based on those priority areas. With an income around $250,000, you're losing out on tax savings by not fully maxing out your tax preferred savings options.

runner3081
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Re: Should we downsize?

Post by runner3081 » Tue Dec 26, 2017 2:50 pm

CPA1981 wrote:
Tue Dec 26, 2017 12:30 pm
We wouldn’t be having this conversation if it weren’t for our neighbors selling their house earlier this year for about $700,000.
Not sure what this has to do with anything. Houses fluctuate in value, up and down. Would you re-buy this house again at the price you paid? If so, stay.

This isn't a "I can't afford it" situation, so you are fine.

As someone else pointed out, cut costs elsewhere. Drop cable, Netflix, etc, reduce cell costs, gym memberships, increase deductibles, eat out lessetc.

You can EASILY cut $250+ per month, most likely. Take this and max out 401K, HSA, if Applicable and then throw the rest at the mortgage if you want.
Last edited by runner3081 on Tue Dec 26, 2017 2:51 pm, edited 1 time in total.

harrychan
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Re: Should we downsize?

Post by harrychan » Tue Dec 26, 2017 2:50 pm

I wouldn't downsize. The end game doesn't have to be to pay off your mortgage. In most places, desirable homes in great locations will add more equity always be desirable. Case in point, when we bought our home in a HCOL area we had the option of buying a cheaper townhouse for $450-500k or stretch and get a SFH for $550-600k. We realized that it didn't make sense to buy a home where we had to share walls and not own the land so we bought our home a bit outside our budget to make it happen. Since then we refinanced and make almost 200% more. It also have since appreciated to about $750-800k. Some of our friends purchased condos and are now stuck as their homes increased in equity just slightly. Some have become involuntary landlords while buying in not-so-great neighborhoods to get into a SFH.

If i were you, I would hold on and re-evaluate when your child enters college. At that time, you can look to downsize.
This is not legal or certified financial advice but you know that already.

island
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Re: Should we downsize?

Post by island » Tue Dec 26, 2017 2:59 pm

Keep it.

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TxAg
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Re: Should we downsize?

Post by TxAg » Tue Dec 26, 2017 3:03 pm

NYCguy wrote:
Tue Dec 26, 2017 2:00 pm
OMG. keep the house you love and raise your family. You are both making great money and can afford it. Your home value may go up or down. Don’t worry about it.
+1

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KSOC
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Re: Should we downsize?

Post by KSOC » Tue Dec 26, 2017 3:05 pm

I'd hold. Mostly because you said down the line you may purchase a similar house. You didn't say you hate it, or bad schools or neighborhood deteriorating.
No buzz words. Moving is a PITA & expensive, and to think of doing it twice more...

Looks to me like you two have set yourself up pretty good.

Don't screw it by stuffing the place full of useless stuff either.

We lived at our first home 13 years, two kids. We moved 6 states away (kids found us anyway) & I thought we got rid of a lot of stuff then. Now at second home of 14 years & the thought of downsizing (kids left, they don't want to be found) is daunting. We filled this one up too!!
Too soon old, too late smart.

senex
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Re: Should we downsize?

Post by senex » Tue Dec 26, 2017 3:16 pm

What a great conundrum to have! It's beautiful to be debt free, and it's beautiful to live in your dream house with a 7 minute commute.

What you're proposing sounds like trying to time the real estate market (sell now, rebuy when prices drop). That's tough to get right, especially given the huge transaction costs.

You can have the best of both worlds by staying put and aggressively paying down the mortgage. It's not unrealistic, at your income level, to be mortgage free in 5 years. Don't change cars, stop buying clothes & electronics, rarely eat at restaurants, avoid consumption-oriented vacations, and you can free up several thousand/month to pay down the mortgage.

My best meals have been cooked at home with family and friends. My best vacations have been staying with family or friends or doing things that are virtually free, like camping in national forests/parks. Consumption-oriented lifestyle is overrated.

Some of my favorite internet posts on this topic are

Ron Ronnerson
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Re: Should we downsize?

Post by Ron Ronnerson » Tue Dec 26, 2017 3:27 pm

I sort of relate to your situation. My wife and I are 43, we have a 3 year old, and we live in a VHCOL area. We live in a 4 bedroom/4 bathroom house that's a bit bigger than we really need. We owe about $370k on our mortgage and our housing cost (including principal, interest, HOA, property taxes, and insurance) is almost exactly $3k. We're five years into a 30 year loan at 3.25%. Our home is worth about $800k so we have a decent amount of equity in it. Due to the fact that transaction costs would be high and that we really like our home/neighborhood/schools a lot, there is no way we would move.

Here's where our situation is different than yours. I'm a teacher and my wife works for a small business. We have a combined income of about $100k less than yours. I max out a 457b, partially fund a 403b, we max out two Roth IRAs, and my wife's employer funds a SEP-IRA for her as well (15% of her salary). We also put $5k into a taxable brokerage account this year. Additionally, 10% of my salary goes toward a pension, which alone should largely cover our retirement expenses. We currently have sort of high expenses for preschool but things should hopefully get better in a year and half when our daughter starts kindergarten. So I understand that daycare can be expensive but am still left to wonder why you're not able to max out your 401k on so much income when you have relatively low housing expenses. If you haven't already done so, perhaps go through each expense carefully and look for places where you can make small cuts. You may be surprised by how much money you find. By th way, we live very comfortably and are frugal but definitely not overly so. We have all the cable channels, my wife gets a daily latte, we take vacations, etc.

You have $250k income and 36k in housing expenses. Where is the rest of your money going?

Coachrhino11
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Re: Should we downsize?

Post by Coachrhino11 » Tue Dec 26, 2017 4:02 pm

Stay! 7 minute commute, we would kill for that. Dream house, easily affordable, pay off early and still invest plenty. What’s point of waking up and grinding everyday if you are just going to hoard all money into investments? You CAN have cake and eat when you are making 250k and pay 36k housing. Moving is stressful, expensive, and I doubt you’ll be as happy as currently. I think the votes have been tallied here, you’ve already made best decision. Congrats!

lws
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Re: Should we downsize?

Post by lws » Tue Dec 26, 2017 4:12 pm

Keep the place and enjoy it.

ConcernedKid
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Re: Should we downsize?

Post by ConcernedKid » Tue Dec 26, 2017 4:19 pm

Keep the house. You already have it, you love it, you can afford it and are emotionally tied to it. I don't know what your extended family situation is, but the extra space can come in handy if you have to support a parent or two down the line. If you were looking for advice to purchase a home my advice would be different. Don't let your neighbor's decision send you a wild goose chase. The neighbor's house going for $700k shouldn't make you want to move (if you weren't otherwise considering it) just as them selling for $300k shouldn't make you want to move. Congratulations on having a house you love that you can afford. Relax and enjoy it!

DarthSage
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Re: Should we downsize?

Post by DarthSage » Tue Dec 26, 2017 4:44 pm

I say, keep it because you love it. Money is important, but it's not everything. Moving is miserable, and there's no guarantee that you'll move, now or later, to something you love as much as this house.

One thing you didn't mention is, do you plan to have more children? It's not my business, of course, but the "too big" house might feel a tad bit smaller if you added another child or three.

Another thought is, would it be possible to rent out the basement for a few years? I don't know that you need the income, really, but if this is feasible, it's something you could do for a few years, and put the rent towards paying down the mortgage. I'm really suggesting you consider this to quell those "mortgage-free" demons that are whispering in your ear. If nothing else, knowing that this is a possible way to bring in money/pay off debt might make you more at peace. Clearly, your current situation is bothering you a bit, but from the outside, you look fine, financially.

Pinotage
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Re: Should we downsize?

Post by Pinotage » Tue Dec 26, 2017 5:43 pm

Keep the house!

Sounds like a great place to be. Awesome location, awesome commutes, new construction that *should* be worry free for quite some time.

If you're really worried about debt look for opportunities elsewhere in your budget. If not, relax and enjoy.

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Ditchwitch
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Re: Should we downsize?

Post by Ditchwitch » Tue Dec 26, 2017 6:13 pm

Like everybody else my instinct says don't move, there's simply no substitute for a sitation that you already seem to love. We stayed in our house almost 20 years when lot's of folks were selling (and probably cashed in well on appreciation)...
Here's the one thing I wonder about...it does seem like quite a sizeable house to buy for a 3 person family. Does that square footage actually get used, maybe you plan to grow the family? E.g. we had 5 in 2,300sqft and considered that fairly efficient.
“Anyone who has never made a mistake has never tried anything new.” | ― Albert Einstein

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Wildebeest
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Re: Should we downsize?

Post by Wildebeest » Tue Dec 26, 2017 6:31 pm

No. Only downsize if you get something else you want more. The house you have now sounds like it fits you perfectly.

There is a lot to be said to love where you live, when you can afford it.
The Golden Rule: One should treat others as one would like others to treat oneself.

Isabelle77
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Re: Should we downsize?

Post by Isabelle77 » Tue Dec 26, 2017 7:14 pm

Ron Ronnerson wrote:
Tue Dec 26, 2017 3:27 pm
You have $250k income and 36k in housing expenses. Where is the rest of your money going?
This is the interesting question. How are you not able to max your retirement accounts? You paid cash to finish the basement... I think you probably need to look at where your money is going and keep your house.

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Watty
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Re: Should we downsize?

Post by Watty » Tue Dec 26, 2017 7:36 pm

One thing I have not seen mentioned is that if you downsize and then move again in a few more years then you kid will need to change schools and make new friends. That can be hard for some kids so I would be cautious about adding that into the mix.
CPA1981 wrote:
Tue Dec 26, 2017 12:30 pm
Gross income is:
Me: $108,000 base with $15-20k bonus.
DH: $112,000 base with $15-20k bonus. ,,,


.....
We owe $360,000 on the mortgage...
Unless there is something else going on I would think that you could easily have the house paid off in less than five years if you wanted to.
CPA1981 wrote:
Tue Dec 26, 2017 12:30 pm
The only other debt we have is on 1 of our cars ($15k)
There is little reason to have a car loan with your income.

I would take a hard look at the rest of your budget before moving to save money.

Dottie57
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Re: Should we downsize?

Post by Dottie57 » Tue Dec 26, 2017 8:25 pm

I agree. Look at your budget and find places to cut. Maximize retirement. Look to put more money to mortgage. The transaction cost of buying and selling is too much if you intend to end up with this type of house later. Keep the house and enjoy it.

LynnC
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Re: Should we downsize?

Post by LynnC » Tue Dec 26, 2017 8:34 pm

123 wrote:
Tue Dec 26, 2017 2:18 pm
You're both doing well. Having a "Happy Home" is a major contributor to your family's sense of well being. You should stay.
+1
Who cares what others say or think? This wonderful home will be paid off soon and maybe you might decide to grow your family and fill those extra rooms.

LynnC

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slow n steady
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Re: Should we downsize?

Post by slow n steady » Wed Dec 27, 2017 6:04 am

My wife and I were in a similar position a little over a year ago and decided to downsize. The house was perfect for us and we loved it. We decided the location wasn't where we wanted to stay long term so we moved. If we had loved the location we would have stayed.

My financial stress has been greatly reduced. We also like the new area that we live in.

Good luck!

snowox
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Re: Should we downsize?

Post by snowox » Wed Dec 27, 2017 6:34 am

I think the thing in your opening comments that was said many times in many ways is how much you love the house and for so many reasons. Thats hard to find and I agree with most other posters if you jobs are secure you are fine. If your worried about building wealth then maybe post a total profile and see if there are other things that can be done BUT I wouldn't sell.

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Top99%
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Re: Should we downsize?

Post by Top99% » Wed Dec 27, 2017 9:38 am

I guess I will be one of the contrarians on this thread... I suggest looking at the upside of selling the house and then deciding if that outweighs the downside. The main upside is it will free up money that could be allocated for other purposes including some combination of:
1) Shortening your time to financial independence
2) Vacations or other experiences
The importance of 1) is something only you can answer. Do you love your jobs? Are they stable? My wife and I had a big custom built dream house which we downsized from and are very happy with the decision. Houses have a lot of costs that are size / cost dependent including property taxes, utilities, exterior painting, irrigation (yard size dependent). In our case we decided less time to FI was more important. We did love the house but we love being FI 5 years early more. :sharebeer

All that being said there are less painful ways to reduce your time to FI I might look at first:
1) Minimizing car expenses
2) Using MNVOs such as Consumer Cellular, Republic Wireless and avoiding buying $1000 phones every 2 years to get your cell phone bill down.

In other words, you might want to see if there are more attractive options to increase your savings before looking at your home.
Adapt or perish

Prudence
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Re: Should we downsize?

Post by Prudence » Wed Dec 27, 2017 9:54 am

I would keep it. We paid extra principal every month and we only had one income. With your combined income, you might be able to make significant additions to your monthly payment.

Steven in NC
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Re: Should we downsize?

Post by Steven in NC » Wed Dec 27, 2017 9:56 am

To me this boils down to trying to time the housing market. My DW and I are mortgage free with a house in a great neighborhood with very little available inventory. Everyday we think should we sell high and buy in a future dip? So far we inch closer to selling but always chicken out in the end.

masha12
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Re: Should we downsize?

Post by masha12 » Wed Dec 27, 2017 10:55 am

You have a 2 year old. The house is on a large lot, you have a 7 minute commute, and the schools are great. Do not move.

In 3 years, when said 2 year old is old enough to play outside alone, you are going to love that large yard. Especially if there are 1 or 2, or even 3 or 4 more little ones down the road. I know it is hard to imagine now that you would ever send a kid outside to play alone, but trust me, that day is coming and you want to have the yard space.

Long commutes with kids at home are a drag. You are spending more time when they are awake sitting on the road. The joy of being able to get home in 7 minutes is worth a lot.

Good schools. It speaks for itself.

bloom2708
Posts: 4103
Joined: Wed Apr 02, 2014 2:08 pm
Location: Fargo, ND

Re: Should we downsize?

Post by bloom2708 » Wed Dec 27, 2017 11:05 am

We can give you the pros and cons on both sides. This one you will have to look at all the information and make the decision based on your goals and priorities.

You bought the "dream house". You finished the basement. You have bedrooms to spare. Space galore. Checked all the boxes. The Jonses are going "whooo..look at that nice house".

You have the nice mortgage to go with it. I think you are looking at everything and saying "Is that what we want?" I completely understand the appeal to sell now, downsize and focus on other things. We never upsized too much and paid off our mortgage as fast as we could.

I would not trade a short commute for a 30-45 minute one. Have you went and looked at houses in the lower price range? Would you both be happy in one? Garage big enough? Enough storage?

I think you would be completely justified selling if you are both 100% on board with that plan. You did the big house/perfect house and found that it really doesn't buy you more time. It takes more to clean. It costs a lot more to keep (property taxes, insurance, landscaping, etc). You will have that mortgage for 15 years.

If one wants to downsize and one wants to stay, then stay. You are leaning on staying. Stay. If you can both agree and there won't be any regrets, then do what makes you happy now. Being closer to debt free, maxing 401ks, Roths, having extra savings, having smaller property taxes, having less house to clean, being in a more "you sized" house. Those can all be big wins.

I guess we can give you different opinions. Gather up the pros/cons and do what is best for your family. Good luck!
"We are here not to please but to provoke thoughtfulness" Unknown Boglehead

sco
Posts: 731
Joined: Thu Sep 24, 2015 2:28 pm

Re: Should we downsize?

Post by sco » Thu Dec 28, 2017 12:33 am

If there was a house next door that you "almost" loved as much, then my opinion may be different...

But for now, don't sell and don't move.
You can afford the house, you like it and you like the neighborhood. How would you feel if you bought the other house (cheaper or not), and hated the neighborhood/commute/etc..????


I would expect this post out of someone that had all of their kids out of the nest, and didn't commute much. :)

fishmonger
Posts: 548
Joined: Fri Jan 31, 2014 2:20 pm

Re: Should we downsize?

Post by fishmonger » Thu Dec 28, 2017 9:17 am

You're in a house you love, in a great neighborhood, good schools, with a great commute. And most importantly, in a house you can afford. Many, many people don't have any of those things, or are lucky to have 1 of 4.

STAY

raisinsaregrapes
Posts: 120
Joined: Thu Dec 21, 2017 4:24 pm

Re: Should we downsize?

Post by raisinsaregrapes » Thu Dec 28, 2017 9:44 am

Ron Ronnerson wrote:
Tue Dec 26, 2017 3:27 pm
You have $250k income and 36k in housing expenses. Where is the rest of your money going?
I'm curious of this also.

User avatar
yukonjack
Posts: 552
Joined: Wed Feb 21, 2007 10:36 pm
Location: Rocky Mountain West

Re: Should we downsize?

Post by yukonjack » Thu Dec 28, 2017 9:58 am

I think the bigger question isn’t whether you should stay or go but why you would seriously disrupt your life over something as inconsequential as your neighbor making a bit of money on the sale of her house. If you decide to stay hopefully this problem won’t resurface when another neighbor makes a profit. Heck most people are making money on home sales in this market.

clutchied
Posts: 518
Joined: Mon Jan 05, 2015 12:11 pm

Re: Should we downsize?

Post by clutchied » Thu Dec 28, 2017 10:09 am

Devil's Advocate wrote:
Tue Dec 26, 2017 1:36 pm
I would keep your home. I'm mortgage free so I understand your preference to be debt free. That being said your income is good and you obviously love the house. You are plenty young enough to sock away enough retirement cash.

IMO keep the house you love.

DA
for sure. You'll regret that small gain forever...

also consider your 7 min commute... driving further costs time and money. Don't underestimate what you have right now.

Sandi_k
Posts: 693
Joined: Sat May 16, 2015 11:55 am
Location: SF Bay Area

Re: Should we downsize?

Post by Sandi_k » Thu Dec 28, 2017 3:12 pm

No way would I move. You have a situation that is impossible to replicate at the price you've already incurred. Moving twice in the future will be expensive - and wipe away almost all of your "gains" from selling now.

I would not do it. Instead, focus on paying off the house sooner than 20 years. If you had the house paid off in 10 years, you'd be able to cash flow college easily.

You make too much money and have too small a house payment to be fretting over making a profit on selling your house now. Optimize your savings instead.

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