Hi CoreyP –
I am in a very similar situation to you so figured I would throw in my 2 cents. In 2017 I moved from my primary residence into a smaller house. My situation differs a little bit in that I moved from a 2 family, into a small single family home. While living in the 2 family I had approximately 1400 square feet of living space, and in the new single family home I have 850. A little over 1 year later, looking back at the move I’m extremely happy that I did it, for me the benefits have been:
- I’m able to live in the single family home completely “free”. Obviously as everyone else has pointed out there is still opportunity cost in having my money tied up in the 2 family residence + the single family residence. However this has really proven to work well for me, I work for myself so my income stream can be a little up and down, having all of my housing costs (including utilities) covered by the steady monthly rent from the 2 family has really freed me up mentally. Basically it took pressure off me, or at least the feeling that I “needed” to land some work every month to pay the bills.
- The smaller home living area forced me to de-clutter which has been great. Additionally its way more efficient to heat/cool this new house which has been a very fun. I’ve essentially followed along a couple of MMM’s improving utilities articles and I’ve been able to get my gas/electric down to around $20/month.
- I didn’t realize it at the time but I do enjoy the added privacy the single family residence gives me over the 2 family (my girlfriend loves that part of it as well!)
So for me while it’s not the most efficient use of my money, it has given me far more happiness than selling the 2 family and moving the excess money into the stock market.