Where to live: What would you do?

[neatfreak]

DD If I may be blunt it sounds like you really want to live in Option #1 but others are telling you to live in Option #2 and so you are trying to make yourself feel like this is the right decision?

Maybe I am projecting-but if you really do love Option #1 go for it! It certainly doesn''t sound so bad to me and really people who live in cities live and raise families in small spaces ALL THE TIME. It''s really not the end of the world to have a small house.

 

[Dreamer_D]

Date: 7/6/2009 2:07:49 PM
Author: sparklyheart
I chose #2 for several reasons.. I''m against buying a house that you can''t comfortably afford. If you truly need a tenant to be comfortable and you are unable to get a tenant for whatever reason, then what happens if the heater goes out, the dishwasher breaks, the whatever goes out? You said it needs upgrades too and if you can just make it already, how will you pay for those upgrades plus any needed repairs in the meantime? Old houses need more upkeep than newer houses which means more money from your pocket. Also, I wouldn''t buy a house that I might outgrow in a couple years (if you have more kids). Everyone else has mentioned you having more kiddos and I think 1200 sq ft is pretty small for kids to be running around in. It is definitely doable but I would chose the 1600 sq ft so they have more room. On the other hand, there is something to be said about the character in an older home.. the coziness.. the unique features..

But I still think practicality would win out...

These are all very good pointd. We could afford the home without a tenant in the sense that we would be approved for the mortgage without a tenant and the payments would not be more than 35% of our gross income, BUT as we all know, those estimates make things very tight in all other domains. The vacancy rates where we are moving are sooooo low, it is highly unlikely the suite would be vacant. The more likely scenerio is that we would have a crappy tenant.

 

[Dreamer_D]

Date: 7/6/2009 2:45:35 PM
Author: janinegirly
I would go with Option #2 because it is less complicated and seems better suited for long term family situation. Plus 10 miles is nothing really.

If you prefer set up of Option #1 (like to be closer to work), consider renting. That way you can feel it out first without worrying about this whole renting the extra space deal. I have quite a few friends who''ve opted for renting this year--I''m guessing it''s a new trend with the market (can''t sell their current place, need more space, and not willing to commit to buying,etc). Not that this is what your issue is, but just a thought.

We are now really thinking about this. Renting is tought, though, because to rent an adequate space would cost about $1500 - $2000, whereas buying would cost about $2400 including taxes and utilities. So the difference is not so large that we would save oodles of money. And it hurts to think about wasting that ~$1700 per month... but I guess that''s about the amount of interest we would pay each month on the loan, so maybe it is a break even situation!!

 

[Dreamer_D]

Date: 7/6/2009 2:48:55 PM
Author: ZoeBartlett
I voted for #2. I wouldn''t be crazy about having a tenant in my house, nor would I like the amount of square footage that house would have. The second house you mentioned sounds like a better option all around.

ETA: I wanted to add that my parents'' house has an in-law apt. that has a completely separate entrance and you''d never know there was anyone else living there (they''ve had the same tenant for aboout 4 years now, and they''ve rented it out to family friends in the past). Their tenant is a great guy and he''s done a lot of work around the house and the apt. If I had a similar set up, I might not mind having a tenant. It would depend though.

My grandparents had this situation and it was really great for them. So did my aunt. We would probably try to use my connections at the university to find a graduate student to rent to, or else we would rent to a new faculty person who cannot afford to buy. We would be picky for sure!

 

[Dreamer_D]

Date: 7/7/2009 8:30:25 AM
Author: Jas12
DD--the short commute is what sold me on option 1. Think about adding an hour or so to your day in the car. Will Hunter be with you during this time (i am assuming so b/c you''ll have to pick him up and drop him off for daycare right?) My MIL takes care of Cohen and i have to drive to her place, out of town, and back in. I hate that drive and so does Co. We haven''t seen each other all day so plopping him in a car seat does not make him happy. He puts up a huge fuss the entire ride home (despite my signing to him, giving him toys, snacks etc.) . Obviously you have a different kid and this may not be a problem, but something to consider.
I also like the idea of owning a home in a market that is going to significantly appreciate in value. Even if you do eventually outgrow the space (which will likely happen sometime after #2) you can either sell and make a nice profit, or continue to rent out the whole home to students etc.

Another friend of mine raised this issue of daycare, and she lives in the area. She mentioned that great daycares will probably be near Option 1! Commuting would be a hassel, and on days that I worked from home, dropping Hunter off at daycare near my work would be silly!

 

[Dreamer_D]

Date: 7/7/2009 9:34:46 AM
Author: neatfreak
DD If I may be blunt it sounds like you really want to live in Option #1 but others are telling you to live in Option #2 and so you are trying to make yourself feel like this is the right decision?

Maybe I am projecting-but if you really do love Option #1 go for it! It certainly doesn''t sound so bad to me and really people who live in cities live and raise families in small spaces ALL THE TIME. It''s really not the end of the world to have a small house.

No not at all! I am just trying to respond to the issues people raise about why they want option 2, just to point out that in many cases it isn''t as clear cut. I think I didn''t really include all the important information to allow others to see the situation exactly as I see it... I think I will start another poll and list the pros and cons more clearly!

 

[Dreamer_D]

Date: 7/7/2009 9:18:54 AM
Author: janinegirly
dd: I guess I would say don''t mix financial motives with long term family living decisions. If they happen to be one and the same (rare) that''s great, but doesn''t sound like it here. Anything that has to be ''stomached'' is not sounding great to me! If you guys were childless, just starting out and nothing to lose, that would be different. I say keep the 2 separate--buy investment properties as investments and homes to raise children separately--this makes the decision a bit clearer. Up and coming areas tend to not be ones with great schools, established neighborhoods,etc. And I''m kind of having a hard time imagining a neighborhood/area that consists of multiple homes with rented out suites as being great long term investment anyway...it sounds like an area that isn''t sure what it is yet and with people outside their financial range maybe?

Janine I agree with you completely. The thing is, Option 1 is the established, older, richer, nicer area! Seems crazty because there are rentals, but property is NOT affordable. It is sort of like California this way. Anyone wanting to get into the area has to have a suite! And many professionals rent... the school system is better in Option 1 and the people who live there are generally richer/better educated.

I think I left too many important details out, I''m going to make another poll! LOL! It isn''t that I disagree with people''s preference for Option 2, I just worry that I left out some important details that could change people''s minds!

 

[iwannaprettyone]

I choose option #2....then again I commute 50 miles one way- so 10 miles sounds like bliss haha in Texas it takes 10 miles to get anywhere anyway

How exciting DD!

 

[neatfreak]

Date: 7/7/2009 9:45:15 AM
Author: dreamer_dachsie

Date: 7/7/2009 9:34:46 AM

Author: neatfreak

DD If I may be blunt it sounds like you really want to live in Option #1 but others are telling you to live in Option #2 and so you are trying to make yourself feel like this is the right decision?


Maybe I am projecting-but if you really do love Option #1 go for it! It certainly doesn't sound so bad to me and really people who live in cities live and raise families in small spaces ALL THE TIME. It's really not the end of the world to have a small house.

No not at all! I am just trying to respond to the issues people raise about why they want option 2, just to point out that in many cases it isn't as clear cut. I think I didn't really include all the important information to allow others to see the situation exactly as I see it... I think I will start another poll and list the pros and cons more clearly!

Lol-sorry for projecting! I just know that when *I* start rationalizing things for one of my options (or defending it) that is usually the one I want in my heart.

 

[KimberlyH]

Date: 7/7/2009 9:31:51 AM
Author: dreamer_dachsie

Date: 7/6/2009 1:58:12 PM
Author: KimberlyH
I would be fine living with a tenant in a seperate unit but I would still choose option #2 for the size/space, walkability, and mass transit. Those things outweigh being a mile from work and $300 a month for me.

I should have been clearer: We will actually earn about $800 from the suite, which will pay the difference in mortgage between Option 1 and Option 2, and also result in an extra $300 in our pockets at the end.

I understood that, I just wasn''t clear sorry DD. My husband is a property manager and with one exception has had great tenants over the years. He has shared a house with a seperate entry (upstairs 1600 sq. ft. downstairs studio w/ seperate entrance), and at one point allowed a friend to rent with him in a shared living space (bedrooms on opposite ends of the house, shared kitchen, living, dining). He kicked his friend out but lived for 5+ years with the shared unit situation with several tenants and never had an issue (and he''s still friends with the girl he kicked out, she was totally understanding).

My biggest concern would be that you and your husband can''t cover the mortgage unless you have a tenant, for now. I know that won''t last long but that would scare me as a homeowner, knowing I couldn''t afford a place if something happened to a tenant, but being a college town you could probably find someone easily.

I prefer older neighborhoods w/ charm and it has walkability. I think, because I''m extremely cautious, I''d still opt for #2, or I would rent until I could afford a bigger place in neighborhood #1.