Having never had a house built for me, I can't comment on the specifics. But one thing always holds true: what's your plan for when/if things go wrong? Possibilities include:
- construction delays
- cost overruns (how much "slop" in the budget can you handle?)
- new home doesn't save you as much as expected (taxes/utilities are higher)
- rental income drops significantly
None of these are insurmountable, but it might be worth it to run the numbers on various scenarios will affect your FI plan. You don't mention how much cash or semi-liquid assets you have, nor how much you have invested in rental properties.
What amenities are available in the newer location? Can you walk/bike to entertainment? Grocery stores? Parks? Or are you going to be stuck with even more time in the car?
All valid points. I was just informed today that the new phase won't open for about another year, so that gives us a significant amount of time to save, plan, look at other options, etc. Plus build time of another 5 months.
Timing the sale of the old house and the closing date of the new house will certainly be a challenge. Hubby & I are pretty resourceful and flexible, but we have pets, so trying to not disrupt their routine too much will be the hardest part. I've already got a kitty on Prozac b/c of stress from the last move, not looking to add any more like her to our new house.
Since we have a year +, we should be in a much better position to handle any cost over-runs or unplanned expenses as a result of the move. I'm glad I at least have some experience in this, sicne I managed to move us across the country 4 years ago for about $2K, and only had one broken mug. And a missing vase, which I suspect is still packed in a box somewhere in the attic.
Taxes here in TX are pretty straightforward to calculate, but since costs go up every year, I expect to see diminishing returns from that every year. However, I'll be going off a much lower base price, so my taxes would increase at a faster pace the longer I stay in my current home. Utilities will decrease - same utility company and rates, and the same energy efficiency features - actually, a little bit better than what we currently have, as this house will be LEED certified. Also, just the sheer volume of space to heat and cool - we'd be going from 3,600+ sq feet to a little less than 1,700. We also have a pool and a hot tub at our current home, but we aren't quite sure what we'd do at the new home. This community has a pool, and I'm reminded of a MMM post about being able to do things at off-peak times. We would certainly wait and see if the community pool is a peaceful alternative while everyone else is out working. If so, then that cuts expenses in two ways - not installing a pool and not paying to run a pump 12+ hours/day in summer.
We've owned these rental houses for a while and while the rent rolls don't increase all that much, they have at least maintained their value. We generally don't keep a lot of liquid around, and given the amount of rents coming in and going out, we generally add to that pile just long enough to purchase another rental, and continue the process that way. We have roughly one year of expenses tucked away, and if the rentals continue to perform, we could add 2-3 months worth of expenses to our savings every month. It's actually gotten to a point where we are finally thinking we should ease off our purchases, and start diversifying into other things, like Index funds and possibly peer lending sites.
Before MMM, my catch-all, no worries retirement plan involved getting to $25K/mo NET income. The current rent rolls should provide a cushion of 3X living expenses, but since we currently live well beneath our income and don't actually touch any rental income, our final numbers when we do retire would likely be a lot higher. Yes, I am risk averse!
I generally don't pay too much attention to what the supposed value of our properties are worth, but I would estimate that they are worth about $800K Net. Our version of an annuity/income replacement.
As for amenities, the new neighborhood will have some trails/pool/parks - almost every subdivision out here does. Nothing in either neighborhood is walking distance, and biking for groceries would be a stretch, especially w/the heat we have out here, so our car time would be about the same, slightly longer. Another big factor for us is we do most of our shopping at Costco, and they are building one now, almost equidistant between both neighborhoods. We currently drive further away to the other Costco, so once this one opens, it would decrease our car time even further - I plan on getting groceries done on my lunch hour, to free up more of our precious weekend time until we retire.
