Author Topic: Should I stay or should I go?  (Read 1980 times)

Louisville

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Should I stay or should I go?
« on: September 05, 2013, 01:18:20 PM »
We dont hate our current place but we'd like to move into the city (we've lived there before) where we can have a tiny house, dump a car, bike/bus/scooter to work, have an actual neighborhood to walk around in, and age in place. It just seems more mustachian. BTW, I want the next move to be the last; were mid-40s.

So do it, right? Well, we paid 165k for our current house in 2008. Then we paid down another 20k to refinance when the appraisal came in at 140k.  Meanwhile, weve paid about 55k in improvements (siding, windows, roof, insulation, etc.). Current mortgage is 30yr @ 3.75%. Balance about 137K.

To buy or build in town would be somewhere between 200k to 250k, because real estate costs more in the city, and Id like to build/remodel to a very efficient, ADA compliant house.

How do I calculate the size of the hit Id take to buy or build in town? And how do I balance that hit against the desire to change our lifestyle?

Some more stats, if youre interested:
Annual gross income:  117k
Annual spending: about 50k (working on it)
Current house sq ft: 2200
Target house sq ft: <1100
IRA/401ks: 200k
Other liquid assets: 60k
Credit scores: 810+
It is possible to rent out our current place, but my research suggests that we would barely cover our costs. It's not easy to rent a house with an acre of yard.

Jimbo

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Re: Should I stay or should I go?
« Reply #1 on: September 05, 2013, 01:32:17 PM »
Well, if you go there will be trouble
And if you stay it will be double...

So it's hard to say.

Ok, that's not very helpful...

Why not consider renting? it could make a lot of sense depending on your location...

olivia

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Re: Should I stay or should I go?
« Reply #2 on: September 05, 2013, 01:49:24 PM »
I'm all about living in the city so I say go for it.  Our house is 750 square feet (2 adults) and is actually plenty of room.  It would be a lot better with smarter storage but we're renting and don't want to spend a ton of money on storage furniture.  (Plus more storage=more stuff.)  But if you're building or renovating you can easily build that in.

Aside from being able to have a smaller house and no cars, living in a city contributes to a higher quality of life for me.  I hate driving, hate commuting, etc., so being able to hop on a subway or ride my bike in is fantastic.  We just sold our one car not too long ago and have access to Zipcar in case we do need to make a big grocery store run or something.  But so far we haven't used it for that-we've just gone to places that are within walking distance, and I bought a little grocery handcart for heavier items like cat litter.

Have you calculated the costs of having a higher mortgage but lower transportation?  And factored in commute times?  You could end up breaking even, or paying only a bit more.