Following the WCI rule of one job, one spouse, one house - A house thread

[gasdoc86]

So, so far I've got the one job and one spouse part down.

The next step is the house. Wife and I started looking and we found something we think we like. 3300 sq ft, 4 bedroom, home office, 3.5 bath, 2 car garage. This would be a new build, in a new development that is going to have a neighborhood pool. The town has plans to build a 250 acre park within walking distance in the next several years. About a 20 min commute to work with no traffic (30 minutes with), 25 to church, and 20 minutes to the beach. Good schools. Base price of the house is 575K, I would estimate that with lot premium, finishes and upgrades the final price would be closer to $675K.

I have $215K set aside for the housing fund right now. If we move forward with this by the time the build is done in 6-7 months I would have roughly $300K set aside for down payment, furniture, closing costs, etc.

There are cheaper/smaller options closer to work. Think houses in the $500-600K range. But, they are in not as desirable areas, or the neighborhoods don't have amenities, etc. Or they may not have 4 bedrooms, which my wife wants in order to have a room for her parents to come stay for extended periods of time.

I recognize that by opting for a more expensive house I am delaying time to FI. But I feel like by buying this house I am more likely to stay in it for a long period of time. No kids yet but obviously with 4 bedrooms we can grow into the house and not have to look again in 10-15 years.

We have no other debt, student loans are paid off, I'm maxing retirement accounts and doing backdoor Roth x2. Have appropriate term life, own occ disability, and umbrella insurance. My base pay is $315K, with incentives and bonuses total is probably about $370K. Wife doesn't work.

What do you all think? My wife feels conflicted between getting a more modest house and adopting a more frugal lifestyle vs getting this house. I have the same thoughts. But I think with this house we are much less likely to look for another one 10 years down the road after kids.

So, what is the collective wisdom of the forum on this issue? Thanks in advance for any thoughts.

Edit: forgot to add that I've been in my attending job about 1.5 years now, I like it, and I have grown up in this area and like it. Family lives close by and all my friends are here.

[Winkleweizen]

Well, you definitely have the income to support it, and with a 215k downpayment on a 650 house youre probably looking at a mortgage payment of 2000/mth which you should be able to support easily. .  Its in a location that you seem to enjoy and will stay long-term.  Commute is not horrible, not great, but ok. It seems that this is in a new community, and im usually a little hesitant with new areas.  You never know whats going to be built next door or what kind of people will start to move to the area.

[ENT Doc]

Thoughts:

Not to be nosy, but can your wife work? Her added income, while taxes at a higher marginal rate can keep her resume built, attached or semi attached to the workforce if/when/after kids come along, and will advance you to FI faster.

New build. Ugh.

No kids yet. Another problem. Wait until your family is actually being realized before making a big purchase like this. Schools are priority.

Not sure where you are, but is this the best you can do re: commute and church, etc?

Not worried about the size of the home or cost per se. Just other factors.

[fatlittlepig]

I would buy it

[JBME]

you can easily afford it....I say go for it. the one caveat is if you have no kids but are planning on it, I'd do your due diligence and research the school district you'll be in. If your plan is to live there for 10-20 years and grow your family in that house you want to make sure you're in an excellent school district.

Yeah it'll delay FI but hardly...maybe less than 5 years for you, depending on a bunch of other factors. But really....is there a big difference between being FI at 40 or 45 vs 45 or 50?

[MPMD]

You can def afford it.

Agree with others to look at schools. Would really suck to get this place built and then realize that you're going to be paying private school tuition x 3.

The other thing since you don't have kids now is ask some friends with kids to assess how it will live w/ kids. A bunch of stuff comes up you wouldn't think of like is the mater suite really far away from the other bedrooms -- great for teenagers but difficult during sleep training, sickness etc. Is there some beautiful feature that is going to be dangerous for a kid? I recently saw a beautiful home where the sweeping lawn fell right off to the driveway with about a 7 foot, unfenced retaining wall. Things like that just don't work for young families and they can leave you scrambling for fixes during busy times.

[Lordosis]

What are similar sized homes that were built in the past few years going for in that community?

My development has a few lots left but why would you pay 400K for a house when it is basically the same at the 300K house that is 3 years old.

When you build you do get some say in what goes into the house but when you buy a prebuilt house you get the advantage of seeing it done before you purchase.

[jfoxcpacfp]

Sounds pretty ideal to me, you can afford and seem to be managing your $$ very well, but def consider the area schools first. And are you sure you want your in-laws staying for months at a time ??

[gasdoc86]

ENT Doc wrote:

Thoughts:

Not to be nosy, but can your wife work? Her added income, while taxes at a higher marginal rate can keep her resume built, attached or semi attached to the workforce if/when/after kids come along, and will advance you to FI faster.

New build. Ugh.

No kids yet. Another problem. Wait until your family is actually being realized before making a big purchase like this. Schools are priority.

Not sure where you are, but is this the best you can do re: commute and church, etc?

Not worried about the size of the home or cost per se. Just other factors.

Click to expand...

Wife could work but at this time we are making a decision not to for personal reasons. I think it is likely she will go back at some point in the future.

What should I watch out for with new builds?

I think I could do a little better on commute time (probably not too much though) but I'd probably sacrifice some or all of 1)price (more expensive), 2) house features that we would like, 3) neighborhood amenities.

Will double check about schools as others have mentioned.

MPMD wrote:

The other thing since you don’t have kids now is ask some friends with kids to assess how it will live w/ kids. A bunch of stuff comes up you wouldn’t think of like is the mater suite really far away from the other bedrooms — great for teenagers but difficult during sleep training, sickness etc. Is there some beautiful feature that is going to be dangerous for a kid? I recently saw a beautiful home where the sweeping lawn fell right off to the driveway with about a 7 foot, unfenced retaining wall. Things like that just don’t work for young families and they can leave you scrambling for fixes during busy times.

Click to expand...

I think it seems safe, master bedroom is upstairs close to other bedrooms.

Lordosis wrote:

What are similar sized homes that were built in the past few years going for in that community?

My development has a few lots left but why would you pay 400K for a house when it is basically the same at the 300K house that is 3 years old.

When you build you do get some say in what goes into the house but when you buy a prebuilt house you get the advantage of seeing it done before you purchase.

Click to expand...

Other houses are similar. We like the idea of customizing things with a new build.



We really like the house. Basically the choice boils down to 1) get a nice house that probably will meet our needs for the foreseeable future or 2) ultra rapid path to FI with tons of flexibility and plenty of room in the budget for extra charitable giving, college savings, vacations, etc etc if we opt for a more modest house.

The trouble is, I don't want to feel regret about passing up what looks to be a great house in a promising area and wish I'd done something different later. I don't particularly want to hunt for housing at a later date. The area we are in is one of the most rapidly growing areas in the country.

[Hatton]

Upstairs master is very negative for resale.

[Lordosis]

hatton1 wrote:

Upstairs master is very negative for resale.

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First floor master is all the rage these days but with little children it is a pain.  I am 30 years old.  If when I am 60 I am tired of walking up a flight of stairs to go to my bedroom I will buy a new house.   We did not look at houses that had first floor masters and it cut out at least 50% of the choices.

In the OPs case I think they should focus on their needs in the next 5-10 years and worry about resale later.  Who knows maybe attic masters will be popular in 20 years.

Sorry to rant but I dealt with a year of a real estate agent trying to show us first floor master houses even though we were clear it was not what we wanted.

gasdoc86 wrote:

Other houses are similar. We like the idea of customizing things with a new build.

Click to expand...

Make sure you get enough garage space.  If you plan to park 2 cars in there make sure there is room for all the other stuff.  Lawnmower, snowblower, tools, kids toys, bikes, strollers, etc.  That is the random junk that keeps my car in the driveway.  In the winder I can move most of the kids stuff to the basement and get my car in but it is a huge pain.

Most people enter their home the majority of the time from the garage.  Make sure it has easy access to the kitchen for unloading purposes.

Remember that decks, patios, landscaping is usually tacked on as extra at the end.

 

[q-school]

right.  was one house meaning one house for your whole life, or one house at a time?  i can't imagine that there isn't some reasonable argument to be made for rightsizing after you have kids and then after kids leave.

also, i have no idea why you would want a 2 car garage in this day and age.  even if to maintain the possibility of sale should something undesirable happen.  even if you use the space as a workout area or storage, i would really consider 3 car garage or even four potentially if the house was bigger.  if you are really going to stay forever, i would have a design that could have an addition made if you decide to have 4 kids or if somehow inlaws or parents needed to move in.

if you have kids and need help from family for few months, the extra garage slot is nice.

 

[artemis]

Lordosis wrote:

First floor master is all the rage these days but with little children it is a pain.

Make sure you get enough garage space.  If you plan to park 2 cars in there make sure there is room for all the other stuff.  Lawnmower, snowblower, tools, kids toys, bikes, strollers, etc.

Click to expand...

A first floor master would be ideal as a guest room for the in-laws, though.  They are going to be approaching the age where stairs are a pain.  And you never know when an accident or illness will restrict a family member to first-floor living for a while.

I agree that a three-car garage would be a good idea.  All the various outdoor equipment does need to go somewhere!

[Tim]

My only thought is there are a tremendous amount of unknowns. Wife going back to work, number of kids, new developments sometimes change the target when things get slow. Sometimes amenities aren’t completed according to plan.

The rule of thumb has an unstated condition of “need”.
You are doing a great job of attempting to define your “wants”. There is one “emotional item” in the choice of options in a new build. Custom or prebuilt or used Are paths too. Five or ten years from now, it won’t make a difference. You will have things you would like different.
A new shiny penny shows a lot of wear in a year.

This isn’t really a money question, it’s more how do you make up your mind which house to buy. I would suggest exploring all your options . Don’t believe me?
Try looking at the same model house ten times. It gets old really fast.

[Lordosis]

artemis wrote:

A first floor master would be ideal as a guest room for the in-laws, though.

Click to expand...

This is an argument against having a first floor bedroom, right?