I'm a long time reader, first time poster because I find myself in a bit of a pickle... My partner and I live in rural New England where utility costs are high, winters are bitterly cold but the cost of living is relatively low. We are in our early 30s and hoping to start a family soon. Our net worth is about $350,000 and we have another $50,000 equity in our house. I work in health care and have been supporting us while my partner has been finishing her PhD. Our plan for the last few years has been to save 50% so that I can at least go part time when we start a family and not be as stressed about saving for the future. Honestly, I would love to never HAVE to work in my profession again. I will always make about twice what she will make as a college professor though. If we stayed in our current area, we could have our house paid off in about 8 years and I could completely retire by 40. I would hope to start my own business and do some slow travel in the summers to visit family and friends when my partner isn't teaching. My partner truly loves what she does and anticipates working for at least the next 15-20 years.
My partner has gone through the final interview process at an ideal teaching position in California. My concern stems from the massive increase in housing cost in the area (about 3-3.5x higher than where we currently live) and taxes and what that means for how much longer I need to work and also what happens to the equity in our house if we move.
To be clear, there is no offer on the table, but this being a 3,000 mile move to such a different area and with some big goals in the coming years, it's something we're thinking about ahead of time. This area has the walkable/bikeable vibe we're really looking for that would allow us to cut down to one or no cars and epitomizes the eco-friendly lifestyle we''ve been talking about for a few years (otherwise I would say forget it). I have run some numbers and we could rent a 1BR/1BA apartment for a "reasonable" amount of money and continue to save about 50% of our income for the first year or two. While I lilke the challenge of downsizing considerably, I worry about needing to work full time if we ever want to buy or rent a bigger place. My salary will likely go down if we move out there, but it could be partly made up for in my partner's full time salary. There is work being done in this area for faculty housing that is more affordable, but this would mean we would forever live in a condo. It's not the worst thing in the world, but I am more of your "handyman, aspiring-woodworking, gardener" kind of person and that makes me a bit anxious.
Without yammering on forever, here are my questions:
1. Should I be worried about the capital gains of our current home equity in moving to an area where I know we can't afford a down payment on a $600,000 house in the first year? (without tapping into investments)
2. Does anyone have experience moving to an area where there are some great things happening, but you may need to work longer to be able to afford to live there, thus prolonging some of the benefits of part time or self employment you've been anticipating? Insights?
3. How to make my spread sheets more accurate while only having an idea (based on my profession's national organization) of what my salary would be and how we could make this work should it come up?
I look forward to hearing everyone's suggestions. Thanks in advance!