Every time we hear the question, “Do we need a bigger house?” we can’t help but smile. It reminds us of the story of a couple who went house-hunting one day. The husband wasn’t really looking to own a new home because he had children from his first marriage. He and his first wife had a large house sitting on even larger land that reminded you of rolling hills in the open countryside—sort of like Virginia horse country. Adding a tennis court and a pool in the backyard didn’t do much to fill the space. There was still plenty of land left—enough for three more houses.
You guessed it. The poor husband spent his days mowing the lawn, cleaning the pool, maintaining the tennis court, trimming the grass and hedges, and landscaping the front yard to perfection—so perfect, in fact, that it deserved to be photographed for a glossy home and décor magazine.
But back to our story: The man remarried, and his hope was to purchase an 800-square-foot condo right downtown and live happily ever after. It turns out his second wife had big plans—really big plans. She wanted a house “just like the one you had with your first wife. I also want an English-style garden and an oversized gazebo in the backyard with a kidney-shaped pool.” When she said that, he knew he was about to relive a nightmare. He didn’t have the heart to question whether they really needed a bigger house because he was afraid of losing her or looking like a cheapskate. He had divorced his first wife to get rid of the space and say goodbye to his lawn mower and toolkit. But no such luck.
Strange how history has a way of repeating itself.
If You Need a Bigger House – There’s Got to Be a Good Reason
A bit of common sense is called for here. To answer the question—”Do we really need a bigger house?”—our immediate answer would be yes, if you’re living in cramped quarters, you have the extra cash, and your family is growing. No need to debate this.
There are as many possible answers as there are scenarios. Let’s review a few:
Scenario 1: A young couple in their early 30s, both working, with their first child on the way. They currently live in a one-bedroom apartment downtown, which is convenient since they can both walk to work. However, the bedroom is too small for a baby, the kitchen is tiny, and the living room is cluttered with memorabilia. Both have decent incomes, are university-educated, and are being groomed for promotion.
Do they need a bigger house? Definitely. A baby’s on the way, and that child will need a separate bedroom. The family also needs a living room spacious enough for everyone to bond comfortably. As upwardly mobile professionals, they’ll likely need space to entertain, but with such a tiny kitchen, that would be awkward. They definitely need a bigger house in the suburbs.Scenario 2: A couple in their late 40s suddenly learns that they will host their boomerang kids. This means not only their 35-year-old son, who was downsized, but his wife and baby, and their 28-year-old daughter who is moving back in because she can’t afford rent after splitting up with her boyfriend. To add to the family drama, the aging and ailing father will also move in because the couple can’t bear to place him in a facility. They have retirement funds saved up in case of emergencies.
Do they need a bigger house? Yes, again. In fact, it’s imperative. With only three bedrooms, they need at least two additional ones. If they have enough land, they could build a smaller house for the father-in-law or the son and his young family. If not, they may need to buy a second, larger house.
Scenario 3: This is the opposite of the previous one. Everyone has moved out, the husband no longer enjoys maintaining a large house, and the wife no longer wants to spend her days tidying up every room. They’ve cut back on entertaining since retiring, and their children are all successful professionals.
Do they need a bigger house? Heavens, no! They should enjoy life without the burden of frequent vacuuming, lawn mowing, or shoveling snow in the winter. If they enjoy traveling, closing a condo and leaving it uninhabited for days is no big deal.
Crunch the Numbers If You Need a Bigger House
When the critical decision is made to buy a bigger house, some number-crunching is in order. You’ll need to estimate:
- The balance of your first mortgage
- The interest rates in effect
- Whether you will use an equity home line of credit against your first house or opt for a straightforward home loan
- What your plans are for the first house: sell it or rent it out? If you sell, how much will be left after the mortgage balance is paid off? If you rent it, can the rental income cover the second mortgage and day-to-day expenses?
- How much will the second house cost? Does it have good resale potential?
- How much will your payments for utilities, taxes, and maintenance increase per month?
- Is the purchase of the second property contingent on the sale of the first?
- And the crucial issue: Will your bigger house need regular upkeep and maintenance? In other words, are you willing to put the time and energy into keeping the house spotless?
If You’ve Started Looking for a Bigger House… Buyer Beware
Just because you’ve gone through the process before doesn’t mean the second time will be a breeze. They say love is lovelier the second time around, but we’re not sure we can say the same about buying a second house—especially a bigger one.
Sometimes we’re fascinated and carried away by the space a larger house offers. But a few months after moving in, you may realize that your eyes were “bigger than your stomach.” Those big bedrooms looked great, but now they’re eating up a chunk of your time. The double basement looked inviting, but your teenage son and his friends turn it into a war zone every weekend. You spend your Sundays cleaning it up, only for it to be trashed again by Friday afternoon. Your son’s friends have moved their band equipment in, and their practice is driving you crazy.
Watch out for the usual pitfalls. Monitor interest rates, crunch the numbers as we suggested, and make sure the location of your new house is ideal. After 15 years, when you’re ready to downsize, you don’t want to spend forever trying to sell it.
For the sake of good sense, ask yourself again, “Do we really need a bigger house?” before making a firm offer on that second home. Think twice, thrice—heck, even four times—because once you sign the documents, you can’t back out… from all that space!
One more thing: Many people place a lot of importance on appearances. Bigger is always better. But is being house-rich and cash poor really better?
