Commute or buy an expensive home near work

[mojami04]

Hello everyone,

Let's get right to it, I'm on the verge of buying a home with my wife and unfortunately where we currently rent, the market is overpriced and expensive.  That being said, we live approximately 12km away from work and the commute is quick and easy as we travel together in a 2001 Toyota Echo that puurs like a kitten. :)

We'd love to stay or even get closer to work so that we could perhaps use the bikes in the spring/summer seasons but the homes are like I said pricey.

Our other option is to move approximately 40-50 miles north where homes are VERY affordable, say 200k less but we have the commute to deal with.  An easy 45 minutes one way on a daily basis!!!


What do you guys think...  P.S. My plan would be to buy a duplex and live in one half and rent the other and live even more modestly.

Let me know, I'm curious.

Jamie

[greenmimama]

I don't see enough info, but personally we live 30min from my DH's work and when we sell we will move closer, do you live where their is snow? that 45 min commute easily turns into 2 hours in bad storms or accidents.

With my personal experience I would like to live close, I like your idea of a duplex.

[gimp]

Math. Must do math. You have little in your post.

So, costs of each:

- House cost + cost of 12 km commute each way (what is that, 5 minutes? 10? 20 minute bike ride?)
- House cost + cost of 45 minute commute each way

After that, throw in some intangibles like how much you'll hate the commute, how happy you are with where you live, and so on. But first, math.

[ysette9]

Yes, do the math. But I would personally add in a fudge factor to account for the intangible value of your personal time. Having lived far from work and now close to work, my sense of contentment with life in general is so much higher now that I am not commuting on traffic-choked freeways. Perhaps take your hourly rate from your job and factor that in to the calculation with the amount of time you would save each year by not commuting.

[GuitarStv]

There's a third option not being considered here:

- Don't buy a house, rent closer to work.

It should be examined and play a part in the decision you make.

[Beric01]

Read MMM's post about the true cost of commuting.

What about renting near your work? You'd simply have to decide to live with less square footage.

I live 2 miles from work in a studio apartment. Sure, the cost per square foot is more than if I lived further away, but I am 10 minutes from work by bike (about the same time as driving due to lights). And since my apartment is small, it ends up being quite affordable (utilities are even included).

The cost to own in my area is also totally unsustainable, so I just recognize that I won't ever own here. I might own someday after I FIRE and move somewhere else, but for now I'm content to rent.

[Eric]

Speaking of math, let's start at the start here.  You say that houses are overpriced, so why do you want to buy one?  Did you do the math to figure out whether buying is better than renting? 

http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html?_r=0

You're only 12km or 7.5 miles from your jobs right now.  That's a totally doable bike commute distance. 

[Scandium]

What are schools like in each of these areas? (important for resale even if you're not having kids)

What are the neighborhoods like? Do you like one more than the other? What about the houses?

Accessibility to shops, airports, activities etc?

Most important IMO:
How long do you think you'll stay in the job? Where are other job opportunities? No sense moving close to this job if you decide to move on in 2 years.

[amicableskeptic]

+1 to biking 7.5 miles, you can even do it when it's cold out http://www.mrmoneymustache.com/2011/11/03/how-to-ride-your-bike-all-winter-and-love-it/

+1 to renting a studio close to work and renting out your current house if the bike is truly undo-able (sure it sounds undo-able in your head when you think of it right now, but get out there on the roads and explore a bit and expand your limits before you give up on it, it's amazing what you can do!).

[JoyBlogette]

Read MMM's post about the true cost of commuting.

What about renting near your work?

+1 This is what I was going to say.

[tweezers]

Yes, do the math. But I would personally add in a fudge factor to account for the intangible value of your personal time. Having lived far from work and now close to work, my sense of contentment with life in general is so much higher now that I am not commuting on traffic-choked freeways. Perhaps take your hourly rate from your job and factor that in to the calculation with the amount of time you would save each year by not commuting.

This exactly.  Commuting imparts a cost that seems insignificant in theory, but in practice it is a complete life suck.

[Beric01]

Yes, do the math. But I would personally add in a fudge factor to account for the intangible value of your personal time. Having lived far from work and now close to work, my sense of contentment with life in general is so much higher now that I am not commuting on traffic-choked freeways. Perhaps take your hourly rate from your job and factor that in to the calculation with the amount of time you would save each year by not commuting.

This exactly.  Commuting imparts a cost that seems insignificant in theory, but in practice it is a complete life suck.

MMM covers this in his blog post. Your time really is invaluable.