Hi everyone!
We currently own a small house in a VHCOL area. The house is 3b2b, 1500 sqft and is currently valued at around $1.2-$1.3M. We have a mortgage balance of about $700k at a 2.375% interest rate. Our home is in an excellent location, with a commute to work of less than 15 minutes. The school district is above average, though we would likely send our kids to good private schools if we stay in this house.
We're in our early 30s and planning to have kids in the coming years. We're concerned that we might need a larger house in a good school district eventually. In our area, a house that’s worth upgrading to and is >2500sqft costs at least $2M.
Here are our financial details:
- His income: ~1.2M (average compensation for a similar position in the industry is ~700k)
- Her income: ~400k (average market compenstation)
Assets:
- House equity: ~500k ($1.2M - $700k)
- Rental equity: ~250k
- Retirement (401k + IRA): ~1.2M
- Stocks: ~1.5M
Our spending: ~80k, including the mortgage.
We're considering the following options:
1. Add 300 sqft to the current house: This would cost about $150k and extend the usability of the house. However, 1800 sqft might still feel small with kids, so we might need to move anyway.
2. Start browsing the market after the first baby arrives: We could look for a permanent house around $2.5M and pay off the mortgage aggressively within a few years if rates remain high, allowing us to live peacefully afterward.
3. Buy a permanent house when the first baby reaches school age: The risk here is that by then we'll be approaching 40, and our income might plateau. If the housing market remains as crazy as it is today, making a large purchase would either be impossible or significantly delay our retirement.
We prefer not to rent as we want full control over where we live.
Any suggestions are appreciated!![:happy]( "smile")
We currently own a small house in a VHCOL area. The house is 3b2b, 1500 sqft and is currently valued at around $1.2-$1.3M. We have a mortgage balance of about $700k at a 2.375% interest rate. Our home is in an excellent location, with a commute to work of less than 15 minutes. The school district is above average, though we would likely send our kids to good private schools if we stay in this house.
We're in our early 30s and planning to have kids in the coming years. We're concerned that we might need a larger house in a good school district eventually. In our area, a house that’s worth upgrading to and is >2500sqft costs at least $2M.
Here are our financial details:
- His income: ~1.2M (average compensation for a similar position in the industry is ~700k)
- Her income: ~400k (average market compenstation)
Assets:
- House equity: ~500k ($1.2M - $700k)
- Rental equity: ~250k
- Retirement (401k + IRA): ~1.2M
- Stocks: ~1.5M
Our spending: ~80k, including the mortgage.
We're considering the following options:
1. Add 300 sqft to the current house: This would cost about $150k and extend the usability of the house. However, 1800 sqft might still feel small with kids, so we might need to move anyway.
2. Start browsing the market after the first baby arrives: We could look for a permanent house around $2.5M and pay off the mortgage aggressively within a few years if rates remain high, allowing us to live peacefully afterward.
3. Buy a permanent house when the first baby reaches school age: The risk here is that by then we'll be approaching 40, and our income might plateau. If the housing market remains as crazy as it is today, making a large purchase would either be impossible or significantly delay our retirement.
We prefer not to rent as we want full control over where we live.
Any suggestions are appreciated!
Statistics: Posted by szxmb751 — Sat Jul 27, 2024 6:51 pm — Replies 22 — Views 1276