Lots of publications love to talk about how many people are looking to downsize and go minimal these days. Oddly, there is not much time given to people that are looking to upsize their living situation.
There are many reasons why you might be looking to get out of your current situation and finding a bigger place. How to know if you should, though? Is there a right or wrong time to look into upsizing.
There are plenty of tips for when you are looking to upsize or downsize so in this article we will focus on the signs that it is time to look for bigger digs and then what to do when you have upsized.
Your family is growing
There is a tradition that young couples start out their life together in a condo close to their work and friends. It fits the bill perfectly as it allows for plenty of time to enjoy your hobbies or social life since there is little to no maintenance to do.
Once the time is right to have a family, though the first thought is to head to the suburbs. Life in an apartment is normal for a large population of the world so it doesn’t necessarily have to be this way. If you love apartment living but feel like you need to move because that is what people do, then sit down and take stock of what you have and decide based on that.
Now, if you can already see that there is not going to be enough space for the growing family, then that makes the choice obvious.
You may only need a larger condo, though so take a look around your area first so you don’t have to disrupt your life too much by moving. A larger apartment in your area will keep you from a long commute from the suburbs and also could potentially be further from your friends. If it is simply a matter of space, choose your next house wisely.
Is it a want or a need?
Clearly, not having the rooms for kids in your current apartment is a need. You can’t pack everybody into one room and live a good life.
But, there are certain things you are looking for that are merely wants. And there is nothing wrong with that, but how much are these wants worth? You’re likely going to be paying a much higher mortgage when you upsize so you need to put a dollar figure on the things that you want from a bigger place.
If your list of things you want is long then the extra cost will likely be justified. Keep in mind that some of the things on your list may be feasible if you simply remodel your current home.
Maybe you just need to remodel the kitchen if you feel it isn’t big enough to entertain friends and family. You could break down some walls and turn it into an open concept plan and enjoy more living space in the same house or apartment.
Take advantage of lower interest rates or property value
This is an excellent time to be looking to buy so maybe you are quite happy in your home now, but feel like you can buy new and get more for the money. Due to the economy many houses are dropping in price for a quick sale. And interest rates have never been lower.
If you are looking around and seeing opportunities to have a larger place and not really spend more to get it then this could be to your advantage.
In this economy, it might be hard to sell your current house or apartment, but the rental market is heating up. You can become a landlord and collect rent on your current place. If you are not handy or don’t want the headache, consider a property management company to take care of all the hassle.
You may end up collecting more on rent than your mortgage is and come out ahead. If you live in a touristy area, then you may think about it being rented out for short term periods like as a vacation home. Airbnb is always a good option, though you will have to consider the hosting fees associated when trying to determine your expenses in keeping the condo or house.
How is your cash flow?
Upsizing your living space also means upsizing your expenses in many cases. Especially if you have to remodel a larger space to update it to your standards.
This can mean being house poor for a period. Take into account how much of your paycheck is going to go towards the house. Not just the mortgage and taxes and the expenses you expect to have. But also the cost to heat and cool the house. How much you will be spending on maintenance like landscaping and painting and things like that.
You may be in for a surprise when you consider how much more expensive a larger place is. Now, this may all be irrelevant if you are actually going to be spending less when upsizing. This usually happens if you are going from a condo in the middle of an expensive city like NYC or Boston and heading out of town to a larger place but one that costs less than what you were currently spending.
You may want to test out if you can reasonably afford the bigger place by making a budget and pretending you have the new expenses. Every month put aside the money it would take to pay for it and see how it impacts your life. If you can’t get to the end of the month with your salary then you know it is out of the question. You may also see your quality of life impacted if you can’t do the things you usually enjoy like eating out or traveling. In which case, you have to make a hard decision.