Need advice cohorts!
I mentioned above how my FIRE date was changing with all the increased saving and increased income. If that market doesn't go wonky, the very earliest I could FIRE is May 2023. This is a huge jump up from my original November 2027 plan.
Now here's my "problem." We were able to cut the date because we bought an inexpensive house in a great neighborhood 4 years ago (spent 215K, instantly appraised for 235K). We made tons of upgrades including new roof (covered by insurance), new windows/doors (10K), new kitchen (10K) and new exterior paint. With the hot market here in AZ, we have 100K - 140K of untapped equity in our home. Even with all these upgrades, I still do not like our home. I dislike the layout and all the little issues associated. We are REALLY interested in getting a new home but are suffering from lifestyle inflation. We really want a nice home that we can spend the next 10 years in.
What should we do?
Option A. Buy a house in 400K price range that will make us happier and use equity as down payment. (Would raise mortgage about $500, pushes FIRE date back to ~2027)
Option B. Buy house in 315K price range that will be not as nice but better layout (Slow rehab. Mortgage does not increase)
Option C. Stay put, stay on track to FIRE early
Option D. ????
Why do you want a new house? Really. will spending more money on a different home make you happier? Once you retire early what will you do with your time? will you sit in the house all the time? lots of questions here and you don't need to answer each individually, at least not on here, but you should be asking yourself these questions and more.
I am in a similar situation. we purchased our home, it's nothing fancy, it's half paid for now. The layout is ok - not a dream home or anything, the neighborhood is just ok. louder than I like, some inconsiderate DB live here. Traffic is nightmare in this area due to rapid growth and no infrastructure. So I've often said we'd stay here until we hit FI then sell it and use the money to buy something we really want. Of course even with the money it's going to cost us more OR we keep this house and travel with the money we'd have other wise spent on a new home. Because what value will I get out of the newer home vs this one? Will that value really make any difference in my happiness? For the me answers are not much and probably not. I will gain more value out of having this humble home paid for and free to travel and visit any place and anyone I like when I want is more important to than where I live.
I used to own the home that I dream of now but had to sell and move due to a job loss and change. I wasn't happier in that home, it was better than this one but in the big picture probably not worth it.
so the point of my rambling is you need to ask yourself these questions and decide what has more value, what your plans are. If you are going to stay in the house, you have lots of family close by who you will entertain at that new place, then maybe it is worth it. For us, we have no family to speak of that ever comes here, nor ever will so if I were to buy the 5 acre lot with a 2000SF home and pool out back it would jsut be a waste of money for me and my wife to rattle around in when we aren't visiting out of town friends and traveling.
I'm not super frugal, not much of a mustachian in that respect but we save over 60% of our total income but we budget 15k per year on vacation/entertainment while trying to minimize other things. I would never suggest you don't buy something that has large value to you, your life style and your plans I would just suggest you really evaluate the value. Not always an easy task.
