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Starter house or stretch for something bigger

 
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amother




Magenta


Post  Fri, Aug 11 2017, 10:12 am
We are looking to buy a house now. Houses are going up fast and it makes sense to buy now vs wait. We are in our low thirties with 3 kids. We both have jobs that we enjoy but neither of us are in fields where there is hope to rich one day. We can comfortably afford a starter house. The problem is that once we get used to budget etc I doubt well ever be able to ever put a second floor on later. The other option is to stretch outselves and buy the more.expensive house now and well.have to.figure out how to meet the mortgage payments....what.would u do..
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loveit









  


Post  Fri, Aug 11 2017, 10:15 am
Smaller house and keep saving
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amother




Salmon


Post  Fri, Aug 11 2017, 10:21 am
My mother always told - stretch as much as you can ... we stretched a little and B"H we are happy. We bought a semi-attached house. When we bought, a completely detached was going for 750k ... we thought that was a fortune. Now you can't even get a fully attached for that price. So prices usually jump ... in a few years you may be kicking yourself if you buy the smaller house.
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amother




Navy


Post  Fri, Aug 11 2017, 10:26 am
amother wrote:
The other option is to stretch outselves and buy the more.expensive house now and well.have to.figure out how to meet the mortgage payments....what.would u do..


figure out how to meet the mortgage payments (and regular maintenance, and savings for major inevitable projects) ... and then buy the more expensive house.

(and if this is going to involve tuition subsidy (or bigger subsidy) get a good grasp on how your school(s) do their subsidy calculations - and consider your own comfort levels around the whole thing).
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amother




Powderblue


Post  Fri, Aug 11 2017, 10:27 am
We were in a similar situation, and we decided not to risk the larger mortgage. I'm very happy we made that decision, because there have been times that even the smaller payments were a stretch for us. Sure I would love to be in a bigger place, but I wouldn't love the stress that comes along with not truly affording it.
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groovy1224









  


Post  Fri, Aug 11 2017, 10:43 am
amother wrote:
My mother always told - stretch as much as you can ...


Keyword here is "can." How many women come on here up to their eyeballs in expenses with no foreseeable way to increase their income?

I think this is a no-brainer. Take the one you can 'easily' afford, sleep soundly at night, and keep saving so you can expand or buy a larger house down the road. For all those saying their stretched their budget (which is a very loose term, means different things for everybody) and are so happy they did, that's great, but it could easily have gone terribly terribly wrong. Loss of a job, serious health issues, major repairs, etc. are all very possible scenarios that can crop up and scraping the bottom of the barrel every month means these kinds of situations could ruin you.
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amother




Cobalt


Post  Fri, Aug 11 2017, 10:54 am
groovy1224 wrote:
Keyword here is "can." How many women come on here up to their eyeballs in expenses with no foreseeable way to increase their income?

I think this is a no-brainer. Take the one you can 'easily' afford, sleep soundly at night, and keep saving so you can expand or buy a larger house down the road. For all those saying their stretched their budget (which is a very loose term, means different things for everybody) and are so happy they did, that's great, but it could easily have gone terribly terribly wrong. Loss of a job, serious health issues, major repairs, etc. are all very possible scenarios that can crop up and scraping the bottom of the barrel every month means these kinds of situations could ruin you.

I totally agree , stretching is really dangerous unless you have family that will pitch it if you fall short. We bought a house we could comfortably afford, we could have qualified for a larger house/mortgage but we didn't want to put ourselves in that position. Several years later I'm so happy we didn't push ourselves. Expenses keep rising especially if you plan on having more children and if you know your income won't keep up you're setting yourself up for a lot of stress later on.
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Chayalle









  


Post  Fri, Aug 11 2017, 11:07 am
We bought our starter house 17 years ago. We've had really good years here, and I'm glad we were in a house we could afford, even though it's been on the smaller side. As others have posted, life happens, and there have been times we've been really really tight financially, even with our lower costs. Tuition, car payments, medical/dental expenses, braces, etc....all cost and strained our budget, despite the lower mortgage payments.
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out-of-towner









  


Post  Fri, Aug 11 2017, 11:19 am
The thing about houses that people don't factor in is the unexpected expenses. In the year that we have owned our house, we have had to do two major repairs that were unexpected but necessary: the boiler and the roof. And the roof wasn't as big of an expense as it could have been simply because our small house doesn't have much roof surface area. A house will cost you more than just your mortgage, so keep that in mind if you don't want to drown in debt.
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shatzileh









  


Post  Fri, Aug 11 2017, 11:28 am
Do you need the more expensive house? Ie, can you not fit into your starter house, or do you think you're going to outgrow it soon? Closing and moving costs are something that needs to be considered as well - if you're going to need to move out soon, you can save by going straight to the more expensive house.

I like advice of first figuring out how you can stretch and make it, and then buying the more expensive house... not in the other order.
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amother




Magenta


Post  Fri, Aug 11 2017, 11:36 am
shatzileh wrote:
Do you need the more expensive house? Ie, can you not fit into your starter house, or do you think you're going to outgrow it soon? Closing and moving costs are something that needs to be considered as well - if you're going to need to move out soon, you can save by going straight to the more expensive house.

I like advice of first figuring out how you can stretch and make it, and then buying the more expensive house... not in the other order.


If I bought the starter house I wouldnt move but hopefully refinance and put a second floor on in five or more (or never Question Wink ) years. I am nervous that well never find the money or courage to take a jump like that but if we start out now with a bigger mortgage well have to just make it work.... Idea
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out-of-towner









  


Post  Fri, Aug 11 2017, 11:45 am
amother wrote:
If I bought the starter house I wouldnt move but hopefully refinance and put a second floor on in five or more (or never Question Wink ) years. I am nervous that well never find the money or courage to take a jump like that but if we start out now with a bigger mortgage well have to just make it work.... Idea


Or not be able to pay the mortgage and risk foreclosure. Is that a better alternative?
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amother




Navy


Post  Fri, Aug 11 2017, 11:48 am
amother wrote:
If I bought the starter house I wouldnt move but hopefully refinance and put a second floor on in five or more (or never Question Wink ) years. I am nervous that well never find the money or courage to take a jump like that but if we start out now with a bigger mortgage well have to just make it work.... Idea


this sounds like a recipe for disaster. Have you done any financial projections?
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amother




Indigo


Post  Fri, Aug 11 2017, 11:48 am
I bought a starter home whichbwas fine but a bit too small. I ended up selling it for a bit more 2 years later and bought a bigger house. The house I have now has a tenant and my mortgage with the tenant is less than the starter home would have been had I took over the ehole house. It was still a big jump but I bought in an area that values are rising and my house 3 years later is probably worth 200 more than I paid for it.
Personally I would stretch it a bit (within reason) so that I can ensure that my house is big enough for everyone.
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amother




Burlywood


Post  Fri, Aug 11 2017, 11:55 am
When we were looking to purchase a home during the housing crash we met with a financial advisor. We were advised to purchase what we can afford. We made a budget and would not go above that. It was the best decision we made. Unforeseen expenses crop up. (Boiler, tax increases, higher water bills, appliances break and need to be repaired or replaced, mandatory tuition increase...). Had we stretched ourselves any further we would have not been able to make it.
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amother




Blue


Post  Fri, Aug 11 2017, 12:03 pm
"We'll have to figure out" doesn't sound like a good plan. If you can figure out a plausible way to stretch that's one thing but you need to figure it out first otherwise go with the smaller house.
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MiracleMama









  


Post  Fri, Aug 11 2017, 12:04 pm
Feeling like you're drowning in debt is a horrible feeling. Do what you can afford. A little stretch is okay; a big stretch is going to mean a life full of tension and anxiety. Be smart, do what is comfortable now and learn to be a good saver and you will be able, G-d willing, to expand in the future.
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Bsimcha









  


Post  Fri, Aug 11 2017, 5:38 pm
We bought the bigger more expensive house with a tenant and for us it was the best idea as when we needed, we were able to expand our space. When prices went up, our house went up a bigger percentage than the smaller house that we considered buying.

Our mortgage after the rent was less than the smaller house, making it a win win for us. Not everyone wants to deal with a tenant.
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out-of-towner









  


Post  Fri, Aug 11 2017, 5:46 pm
Bsimcha wrote:
We bought the bigger more expensive house with a tenant and for us it was the best idea as when we needed, we were able to expand our space. When prices went up, our house went up a bigger percentage than the smaller house that we considered buying.

Our mortgage after the rent was less than the smaller house, making it a win win for us. Not everyone wants to deal with a tenant.


The problem with relying on tenant income is that it can be unreliable. We found a tenant when we moved in, but then he left after a few months and we were left without income for a while. BH we weren't relying on that income to make it or break it for our mortgage, but it can be a pitfall.
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nicole81









  


Post  Fri, Aug 11 2017, 6:56 pm
I would consider the larger house if and only if your jobs were stable with guaranteed increases in salary, ie unionized jobs with contractual pay scales. And even then, I couldn't say for sure without knowing the details.
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