WWYD? sell or stay put? Looong (sorry) :)

[Tap]

Dh and I are pretty careful with our money so this is a hard question for me. Should we consider staying in our current home or look into buying what we really want?

 

Here are all the details I could think of that someone may ask:

 

We have a 2200sqft home that is 9yo and we only owe 5 more years on. The interest rate is a 4.75 so it is a decent rate. Our mortgage is about 15% of our income. Our property taxes are reasonable as are the utilities etc. We bought at a good time so even with the economy and price adjustment, we would still walk away with, a realistic, $75-100,000 if we sold it. We have some nice upgrades like AC-electronic air filter, sprinkler system, extra fenced area for a vehicle/boat, front porch, large covered patio, nice landscaping etc. We also have what is considered a 'decent sized lot' for this area and it is very kid friendly with both a front and back yard. We do have some nice selling points to make it stand out from other homes.

 

Dh's job is in sales. Sales are down, but they are everywhere so he isn't any worse off that his equals at work. He doesn't have an education but worked his way up to District Manager at his company. He fears that if her ever lost his job, he couldn't replace his pay because while he has the experience, he doesn't have the degree. He works 60hrs week, so getting a degree while working isn't a possibility.

 

I work in pharmacy part time. I work just to keep me busy, fund my retirement and to pay for fun things for the kids like classes, camps, etc. If dh ever lost his job, I could work full time and we could scrape by on my pay in our current house.

 

Our house is in an okay neighborhood. Small, private neighbor hood with one street in/out and about 100 homes. We live in a culdesac'd portion so no through traffic. Nothing great, nothing bad..pretty typical here. There are a few things that we don't like ie noisy neighbors with noisy dogs. ONE major thing that we don't like is that we are next to some rail road tracks. The tracks were only used once weekly for a 6 car train when we bought. Now they use it several times daily and about 500 feet from our house they store large piles of dry products like silica, that they load/off load from the train. They are very noisy, banging on the train cars as they unload them. It is momentary and is over in 5-10 minutes. While it wouldn't make the selling process easier, people still buy/sell houses in our neighborhood so people must be willing to over look it.

 

The kids/families in the neighborhood are a huge reason to stay put. There are several of us families who have been here the entire time the homes have been here. We know each other well. We trust each other for babysitting, house sitting, overnight sleep overs and just watching out for each others kids in general. Summer evenings usually pull a dozen kids from their home to play kickball in the street or basketball. It is a lot like when I was growing up and they kids actually played together outside instead of inside on video games.

 

DD11 has a best friend across the street that she has grown up with since they were 1 and 2 yo. This family is like family to us...in fact we are closer to them than our bio family.

 

 

Why we want to sell (maybe)

We know this isn't our forever home. We could easily afford more home and to possibly buy an acre or two. I really, really want a garden and we have outgrown this home in children (3br/5people). DS16 is planning to stay in this area for college and doesn't plan on moving out until after college. Dh and I are not attached to this home, but we are to the neighbors. Our kids are attached to this home as they have lived her most of their lives. If we decide to stay until dd11 goes to college then we could have the same issue with dd3 as we do now with dd11 and her friend across the street. I worry about the piles of dry products so close by, and would rather not listen to the clang, bang, bang of the trains. We are at the point, that if we stay we are going to make some additions to the home, so we will have more money invested with little increase in home value. The floor plan is okay but not great. Tiny bathrooms, small closets and little storage. There is no place for teens to hang out without being in the middle of the living room or in the small bedrooms. We would really like to have another space for them.

 

Interest rates are down again and so are home values. Yes, we know that means we get less for ours too but we could easily go back to a 20 year loan and have plenty of time to pay it off before we hit 60yo/retire.

 

 

One of the biggest reasons we stay is that we are soooo close to paying it off. Our origional plan was to pay it off and then buy another home while renting this one out, possibly to ds if he was interested, in his mid/later college years.

 

Another HUUUUGE, point is, that if dh lost his job...I could handle the mortgage/expenses now, but not necessarily on a new place.

 

 

We don't want to try the 'just see if it sells' approach because, if we are going to sell we need to put a bit of money into it, like fresh exterior paint. If we are going to stay, we are adding in things like a fireplace to make it closer to what dh and I want. I want to paint the oak kitchen cabinets if we stay....doesn't make sense if we are selling. ETC.....

 

 

Sooo, talk me through, help me think it through, just say something to stop the swirling in my brain!

Edited September 6, 2010 by Tap, tap, tap

[StaceyinLA]

- certainly before i invested much in it knowing I didn't want to be there forever.

 

However, if you are thinking you could scrape by if dh lost his job, then try and find what you're looking for in a price range that keeps your note about the same. If you walk out of that one with 75,000, and you are gonna make a 20-yr mtg, you should be able to make a pretty big leap in price while keeping down your pmt (rates right now are around 3%).

 

Of course, this is just my opinion, but we have land and I love some of the freedoms that provides!

[Margo out of lurking]

I can easily say this since I am not in your situation, but I would not sell in that situation at this point.

 

However, if I really, really wanted to move, I would consider renting out the house and buying another. It sounds like you may have the funds to do that, plus you'd be getting income from a rental house which would supplement your retirement. Based on what you said, it seems that you would be able to get quite a bit more in rent than your expenses for that house.

 

But I'm a little biased. We just moved to a neighborhood we thought we'd never be able to afford. Thanks to the housing market, we can. And we're renting out our former house, although we may just break even on it IF the renters stay put through the length of the lease.

 

Oh, I would hate to leave a neighborhood I loved though. We never saw our former neighbors, so that wasn't an issue.

[Rosie_0801]

I wouldn't sell, but what you've described is about as close to perfection as I ever imagine I'll attain, so that might have something to to with it. :D

 

I would pay it off and save for your forever home, with the idea of moving into it when the kids' friendships are no longer an issue. Friends really aren't that easy to make. In the meantime, you can learn about gardening in small spaces. It's amazing what you can fit in when you learn how.

 

Rosie

[gingersmom]

"Another HUUUUGE, point is, that if dh lost his job...I could handle the mortgage/expenses now, but not necessarily on a new place. "

 

 

I think you answered your own question.

[LibraryLover]

If I was unhappy, I would move. Life is too short.

 

However. (To me) Moving is a big fat pain in the arse. Do you want to deal with this? Would the profit margin be enough to make it worth the aggravation at this point? If you wait 5 years (or whatever), maybe the greater profit and the capital gain tax would be worth it.

 

But. Maybe you like moving? Some people like to move. :) (Not me lol).

Edited September 6, 2010 by LibraryLover

[freetobeme]

i'd stay. move later if you want when the children are older/moved out. but that's just me! :001_smile:

[Dobela]

I would stay. You will have it paid off soon. You and your children have friends. More land sounds great, and as we are house hunting I understand why you want it (because I do too). However, one thing dh and I have discussed is just who is going to maintain that larger yard and land after the kids are gone? We will be near retirement and don't want to be tired to more than we can handle.

 

I was telling my son about the trains near your home and he is green with envy that you live so close to tracks LOL. That is his dream home :)

[texasmama]

As someone who has experienced buying more house than we could afford given some unforeseen job setbacks for dh, I would absolutely STAY PUT. I would make the best of it, wait it out for a few years and see how things are then.

 

We had three bedrooms for six people for almost five years until we broke down and converted the study to a bedroom for our littlest girl this summer. It is doable.

 

Peace of mind knowing that you are not stuck in a bad financial position with a house is absolutely priceless.

[Alyce]

You can afford this house if your Dh were to lose his job and you couldn't if you bought the other one. This is a major factor to consider. The economy and especially the job market is still in major flux. You don't know what will happen. You only have 5 years and after that the house is yours free and clear. If you sell it then it will be all profit and you can do a great deal for that little difference.

Dh works at one of our state's unemployment job office. Right now it is really hard for anyone to get a job as you already now. The figures are much higher than they are reporting because the numbers don't count people who are no longer eligible for unemployment or who have given up. Even getting unemployment will do little to help most people keep afloat. He has clients with masters degree and college degrees that can't get a job and for someone with no degree it's almost impossible. Because everything is so unstable now I'd wait. We are actually close to your situation. We are paying our mortgage off in the next couple of months just so we can be stable if something happens. Our kids are now grown so we could sell if we want and we'd be in a much better situation. I just don't think this is the right time to take a lot of gambles. I've seen too many people do that only to lose.

[Renee in NC]

I would stay put.

[Ottakee]

I would stay put unless you can find something that you like better for the same montly costs (taxes, insurance, mortgage, utilities, etc) or less. I would not want to take a risk of having more debt/monthly expenses in this economy.

 

You could always start looking and see if something comes up that has more land, in a nice area, that is affordable. If it does, then sell. If not, stay put.

 

Oh and on property taxes, when looking at a new place, find out what the taxes woudl be for YOU, not just the current owner. I don't know if other areas have this, but in Michigan (at least where we live) there has been a cap on tax hike rates BUT if you move, it adjusts to the current selling price and that cap doesn't apply. For example, our neighbor behind us owns 40 acres and has a 4 bedroom house (very old though) with 3 outbuildings on it---VERY prime property with a crick, little sand dunes, open meadows, some woods, etc. Since he bought it so long ago his property taxes are less than 1/2 of what ours are and we only have 5 acres. His property though is valued at 4 times what ours is so if someone bought him out now, their tax rate would go up way beyond what he is paying now.

[Prairie~Phlox]

I would stay as well, with the way the economy is, it's better to stay put. Plus, 2200 is quite a bit of square footage, we have 1900 and it seems huge to us after coming from 900 square ft. with three kids. There's nothing wrong with children having to bond with their families and not have quiet spaces to run off and hide in. I don't know, I just think families are too spread out anymore.

 

JMO.

Good luck.

Kristine

[LisaKinVA]

I'm voting for staying put... if the concern about dh losing his job is something you are worried about. If it's a this "could" happen, I might risk a move.

 

Another option that you haven't mentioned is remodeling/adding on to your current home to give you a bit more room -- it may cost substantially less than moving would, and get you through to the point where you could move to a "forever" home much more comfortably. I'd even be happy to draft some ideas for you on graph paper :D

 

We will soon break ground on our just under 2600 3BR, 2.5 bathroom home (for our family of 7). I expect this will be our "forever" home, unless dh for some reason transfers out of the area. It's not my "dream home" by any stretch, but is as close as I'm going to get on an affordable mortgage in this area. Staying put is the only way we will "get ahead" financially. We will have the house paid off in 15-17 years.

[SailorMom]

After living in everything from 800 sq ft to 3000 sq ft - I can tell you my ideal is about 2200 - 2400. So your house size is perfect! Anything more is just too much to clean :(

 

Being that close ot being paid off, and having your kids' friends so close..... I would probably stay until at least one or two was out of the house and then decide. Unless the PERFECT house came up for a PERFECT price.

 

The economy is not going to get better anytime soon. I hate to be "doom and gloom" but I think at this point it is still very prudent to plan for a job loss or a further reduction in pay. Being in sales - your DH may be in for an even harder hit by this time next year.

[ma23peas]

I would stay put....our home was one of 7 for sale for over 2 years in our neighborhood...no trains, 5 of those are still for sale...it is a great stressor to put a house up for sale....if your husband got transferred and you had to move, that would be a different case...but right now, with the economy the way it is...it would be very hard for me to make that decision. Stay and pay the house off..you lose quite a bit of money in real estate transactions (closing costs, moving costs)....maybe open up a house buying savings account....give this economy 1-2 more years before making a decision..it's not looking good.

Tara

[elegantlion]

I would stay put. In 5 years when it is your, re-evaluate. For a few reasons such as your neighborhood sounds lovely. Trains?! Those would drive me nuts, but it might be a big turn off to a buyer. In this market location may trump all the extras you've put into the house and it could be harder to sell.

[Jeanne in MN]

Another vote for NOT moving! Low interest rates or not, you only 5 more years on your mortgage. If you start all over again you'll lose thousands more in interest by starting over. You have so many positive things about your neighborhood too. Don't don't mess with what's working right.

 

As a family of five (all kids are teen or pre-teen) in a 1200 sq. foot home, what you have now sounds enormous.

[EmilyK]

I wouldn't underestimate the importance to your kids/family of having neighbors and neighborhood kids that they are close to. It can be hard to replicate. I understand why to adults having a large piece of land, privacy etc is appealing, but to kids that's a barrier keeping them from friendships (possibly).

 

I'm not saying "don't move" but I've seen in my own life and others that the time of life that parents would like that seclusion may not be the best time for the kids to have it.

 

Just my opinion -- feel free to reject.

[ChrisOR]

I would stay, get the house paid off, and decide then if you want to sell or stay. You're so close to paying it off, and its very affordable (15% of your income!!!).

 

The stress of more monthly output wouldn't outweigh the benefits of a different house, I think.

[StaceyinLA]

Whatever you decide, I would NOT buy something else and rent your house. You then become dependent on someone else keeping their job and paying their bills, and if something happens, you are responsible for not one but TWO payments!

 

And while I think that staying where you are might be better from a strictly financial pov, I still think, if you are patient and find the right place at a the right price, you could have your dream place.

 

I just wouldn't sink a lot of money in if you know you don't want to stay because then you're going to have less equity when you do sell (assuming you have to borrow to do big repairs). Also, a lot of those things won't increase the value either...

[Teachin'Mine]

I understand the allure of a larger home and more land, but I wouldn't sell.

 

Good neighbors are priceless.

Peace of mind knowing it will be paid off in 5 years - priceless.

Knowing your salary could keep you afloat there - priceless.

 

Paint the outside - do what will make you feel good when you look at your home. If you really need more space, think about adding on - maybe a two story addition. The downstairs are could be a nice large family room and bedrooms could be upstairs. As for a garden, a good one doesn't necessarily take a huge amount of space. Starting small and maintaining it well is more important. Make it beautiful with some natural stone raising it up, and plant what you will enjoy.

 

I think your plan of renting it out once it's paid for could work too. Then if something happened to your finances, you could always more back if need be. Think about how many years you'd actually need a larger home. That time passes quickly and people have made do in houses much smaller than yours. Think about all the splits and ranches from the fifties and how much larger families were then.

 

As far as the railroad tracks, can you plant some nice dense evergreens in the back of your property? These will act as a buffer for both the sound and airborne particles from what's stored there. I think rails are being used more these days because of the high cost of fuel and trucking. When fuel prices come down, you'll probably notice a drop in the rail use too. :)

 

Good luck with whatever you decide.

[coffeefreak]

I'm going to answer before I read the rest of the thread so I'm not swayed :)

 

I would stay put for the following reasons:

 

1. The neighborhood. We lived in the WORST neighborhood when we bought our first house. I couldn't let my kids play out front, they couldn't go to the park by themselves, and the neighbor to one side of my house was a horrible, horrible witch. The house we just moved out of (it was a rental) was in a FABULOUS neighborhood. We were sad to leave but are thinking about buying in that neighborhood when we have a down payment saved up. Good neighbors are hard to find.

 

2. DH's job/paying off the mortgage. If you wait just 5 more years, your house will be paid off?!? WOW! THAT'S AWESOME! I would wait, pay off the house, see how DH's job goes, and see if you really want to sell then. Once your house is paid off you may want to take the payments and build up a fabulous emergency fund and then sell. OR, you may find that once it's paid off you love having a paid off house and you want to stay. OR, you may find that once it's paid off, you want to save a little while longer, sell it and THEN PAY CASH for a new house!!!!:hurray:

 

Unfortunately, in this economy, you have to consider what will happen if DH loses his job. Since you only have a couple of years before you pay off the house, it might be really nice to have the security, wait for the market to go back up, and then move forward.

 

HTH!

Dorinda

[Ruby]

Maybe I am gullible or always think the worst is going to happen...but our sources are counseling us on being debt free. The rumor is that we will be entering into a major depression if we haven't already begun it. The economy should take another major hit and the expected upturn wont be until 2017 or later. So if you can sit and be content, see what the economy really does in the next 3-4 years than make a decision? Getting debt free with no mortgage means freedom for you and no stress. That is priceless. Just my 2 cents.

[Tap]

Thanks everyone! Wow, an overwhelming "stay put" ! I know this is what my mind keeps telling me, but my heart.... oh, well. You all are right. We do need to stay for a little bit longer. I don't like being on a budget and this house helps us to do that.

 

I think we will just keep putting up with the things that we don't like, and keep working toward making the house what we want it to be instead. Our next project is adding in the fireplace, adding another window downstairs and then repainting in the spring. We want to finish the construction before we paint.

 

To answer a few posters comments, no, we can't realistically add on. Our lot is on a curved corner, and is shaped kind of like a square with the right, back corner cut off. Due to this the only place that makes sense to add on (the right back side), would put us too close to the neighbors property line. We have seriously considered adding on over the garage. It is realistic to do, but would cost about $25,000 to gain 300sqft. We don't like to finance things such as this, so we would have to save for quite a while first. We may just have to bite the bullet and finance part of it anyways.

 

We gave dd3 her own room this year by using bookcases to divide the bonus room/library into two sections. It has worked great but took away the one 'hang out room' we had away.

 

I just feel like we keep forcing this house to be what we want, without it actually being what we want. LOL It is like a little 'mock' house. LOL

 

Thanks again everyone, it does help to see that we are making the right decisions.

 

~Tap

[KidsHappen]

I would stay put as well. I only have one more move left in me and that is when we downsize after all the kids are out on their own.

[idnib]

Another vote for staying put.

 

We sold our very affordable condo because we could afford so much more and when my husband was unemployed for 15 months we burned through our emergency savings. (Luckily we didn't end up in debt due to our substantial savings.) When he found a new job this spring, it was for about half what he made before and now we're having to sell the house for less than we bought it for (but still more than the mortgage balance), plus we have to rebuild our emergency savings, which would not have been nearly as depleted if we still had the condo.

 

I grew up on a cul-de-sac with a bunch of kids and we all ran around together. I'm really glad my parents stayed and now that all the kids are grown up the neighbors keep an eye on each other. Everyone has been there for 30-35 years. They help out with fixing cars, gardening, cooking of someone is ill, etc. My parents thought about downsizing but couldn't bear to leave their neighbors.