Update: We've made a decision, but there's another unit opening in the same building which brings up another set up questions: see post #9My wife's new job brings with it a new location and a bigger salary, so as these kinds of changes tend to do, it brings us to a crossroads. We've seen a bunch of apartments in the new location (we're currently staying in an AirBnB until August 5th) and have started to narrow it down between a few very different options.
Our situation is that no matter what we pick we'll be saving at least the 2% mandatory contribution from her $95k salary, $18k to her 403b, $18k to her governmental 457, the 10% employer contribution and depending on my highly variable freelance income (~$35k last year) maxing both of our traditional IRAs at $11000, and my solo 401k ($24.5k last year), for a total of $82.9k. The $18k going to her 457 and the 2% mandatory contribution represent an increase in our savings thanks to her new higher salary while the rest is what we've been doing for the past few years.
Her take home should be $2880/month after all deductions (the savings above, health insurance, all federal/state taxes, payroll deducted gym membership, long term disability), and most/all of my income will likely go to the IRAs and solo 401k.
With the cheapest apartment we're considering (option 2) our budgeted expenses would be $2580/month ($300 extra), and the most expensive (option 1) would be $2830 ($50 extra) for a $250/month or $3000/year difference. Any surplus will go to some combination of additional savings and/or additional travel spending.
We haven't looked very closely at it because we REALLY don't want to be homeowners again, but I think rent vs buy would favor rent in this market.
Moving sucks, so if at all possible we would like our choice to be our home for as long as we're here (at least 5-7 years).
Her take on it is that we can afford option 1, we've already added a healthy increase to our savings ($19.9k), we both like it better, she can "see us there," and it "feels more grown up" (we're 32). I'm struggling because I don't disagree with any of that, but at the same time I think option 2, while not ideal, meets the threshold of "minimum acceptable housing" and would save us $3000 that we could put towards other things.
I think we would both agree that option 1 is more like the kind of place we would like to eventually live, but what we (mostly me) are uncertain of is whether now is that time, or whether we should hold off a little longer and put that money towards additional savings and/or travel which is a priority for us. As are all things with money, basically this is a question of priorities, in our case between financial freedom, travel, and housing quality.
We love travel and plan to make it a part of our life in both our earning years and in retirement whenever that comes (tentatively 45 or 13 years from now, but various things could push that either direction). When we're not traveling we're essentially homebodies: I work from home, we cook more than we go out (and enjoy it), and we like having people over. So both travel and housing are things we would like to spend more on.
This is not a "him vs her" thing as (I think) she can understand and appreciate "my" take on things, and I'm just generally conflicted between competing priorities that will most likely always be in competition in our life.
So should I "loosen the pursestrings" when it comes to housing? Or should we up our savings game? Or spend more on travel? Any stories of a similar decision you've made, how you decided, and whether you feel you made the right choice? We might try negotiating the rent on option 1 - any tips on whether that might be an ok thing to do and what might be reasonable?
Here are the options we're considering
Option 1: The nicest and most expensive option. It looks like the picture below except it is on the 1st floor which has stained concrete floors instead of wood (funky in a good way). 0.7 mile / 15 minute walk (up a steep hill) to my wife's work. 0.2 mile / 3 minute walk to the (free) bus she would probably most often take instead of walking. 1.1 mile / 22 minute walk to the fun to walk around downtown area. This would be among the nicest places we've lived. The front steps could probably be used as a small bit of outdoor space. The landlord is a family run business with 64 units and the young man in charge (probably our age) seems laid back, yet responsive (maybe a bit too much so - daily drive by of his properties were mentioned). This is a 1st floor end unit in a 1 deep, 2 story apartment building. It will be $825 with no utilities included. Available now, but he's willing to push it so we pay half a months rent for July and we can move in at a more leisurely pace.
Option 2: The cheapest and least nice option. It is literally across the street from option 1, so the transit and walk times are the same. The posting didn't have pictures, but it looks similar to the image below, but maybe a bit more run down. The key points are more dated fixtures and furnishings, carpet in the living room and bedrooms (which neither of us, and especially I don't like), vinyl or tile in the kitchen and bath (I forget which, and will have to double check when we view again), and just generally more worn down. This would probably be on par with, or even a small step down from most other places we've lived. It definitely has a college kid feel in this college town, but there's nothing inherently wrong or unsafe about it. The walkway out of the apartment could probably be used as a bit of outdoor space. This landlord also has a handful of buildings, seemed a little "twitchy"/nervous, middle aged, and was a little slow to get back to us about a showing (never responded to my wife's voicemail, but responded to my email -- not sure if he ever made the connection, or just never got back to her. This is a 1st floor corner unit in a 2 deep, 2 story apartment building. It will be $695 with water included (which should save us $50-60/month). The timing on this should work out just right so we move in right when our AirBnB rental is over and we won't have to pay any extra rent.
Option 3: We will see this one tomorrow, but if it is as it appears this one should be in between the two in terms of both price and niceness, but a little further away from work and the downtown area. It still has carpet in much of the house (again, not my preference) with tile in the wet areas, and wood in one bedroom, but it's currently owner occupied, so we're hoping it's kept up better. The fixtures and furnishings are still a little dated, but not as much as option 2. 0.9 mile / 21 minute walk to my wife's work. 0.2 mile / 3 minute walk to the bus (one stop further to ride than other two), and 1.3 mile / 27 minute walk to the downtown area. More outdoor space than the other two with a small front yard (need to find out who mows this) and a small enclosed patio in the back. The landlord will be a 1st timer now that she's bought another house and is keeping this as a rental (could have good and bad aspects). We don't (yet) know what her motivations/intentions are in terms whether this is a stopgap until she sells, or if this is a long term thing. This is townhome that shares walls on either side, but has both floors to itself. It will be $765 no utilities included. This one won't be ready until mid august so we'll have to find more short term housing for a few weeks which will probably cost another $500-600, but it will probably be pretty close to a wash with prorated rent.
