Can I Afford to Buy a Bigger House?
Your family is expanding but your home can’t seem to keep up.
What was once the ‘guest bedroom’ is now the domain of a little person who has certainly overstayed the limit of any polite house guest. Your once spacious living room is currently a multi-purpose Lego-land, homework zone, video- game haven, and also the space where you need to find a quiet spot to get some work done. Maybe it is the long bathroom queue every morning that is getting you down- banging on the bathroom door and hollering “hurry up” isn’t your idea of an enjoyable pre-coffee activity. So you need an extra bathroom, and maybe a bedroom or two, in order to house your growing brood. But can you afford to buy a bigger house to accommodate your growing family’s needs?As with most issues of a financial nature, the answer to that question is highly personal. If you own your current home you already have your foot in the market, and you likely know the ropes of purchasing a house. Researching market prices, lenders, mortgage terms and rates, and determining how much you can ask for your current house and afford in a new home is all part of this personal process . This is the hard stuff that only you, and your financial advisor, can figure out. Once you know how much money you are working with, you can begin to investigate how much house you can realistically afford to purchase.
Before you being house hunting, take the time to consider if moving is really what makes the most sense for your family. In real estate, a well known saying is that it is less expensive to build house than it is to buy it – while this isn’t true in all markets, it is something to think about. For a growing family, this could mean that a home renovation makes more financial sense than moving.
If after weighing the options you decide that moving house makes more sense than renovating, you still might be stuck trying to figure out how you can afford what your family needs.