Buying a Bigger Home: Is it a Good Financial Move?
There is no denying that owning a larger and a more spacious home gives satisfaction and fulfilment. This is especially true for growing families or couples wanting to raise kids. When a family’s starter home is beginning to feel a little bit cramped, a bigger house is traditionally better.
A bigger house or a better neighbourhood means more space for kids to play and families to enjoy. A larger house and land will give parents and kids more room to live a better quality of life. The main concern, however, is the money required to purchase a bigger property. A larger house also means more rooms and areas to clean and maintain, which will definitely affect a homeowner’s budget.
Finances and Affordability Issues that surround a larger home purchase involve finances. There will be a bigger mortgage payment, homeowner insurance bills, property tax, moving costs and utility payments. Making the transition requires being aware of all the associated costs and being ready to afford more debt. It is also important to be comfortable with handling a larger monthly payment and cutting back on certain luxuries like trips or eating out.
The Issue of Selling and Buying Those who can afford to take in more debt need to ask themselves if they really want a larger home. Most people need to sell their homes before purchasing a new one, unless they can handle two mortgages. It is important to make a sizeable profit from the sale to cover the initial expenses on the new property, including down payment, moving expenses and closing cost.
The Emotional and Social Aspect There are plenty of upsides to buying a bigger and more expensive home. It can offer an emotional benefit that comes with owning a more beautiful home. It can improve quality of life and change social status a bit. Moving into a bigger house means growing up and making an upgrade. It can have subtle impact on friends and families, and how they think of the homeowner.
In most cases, the right house for a person or a family is the house that feels right and costs right. If a 4- or a 6-bedroom house can make the entire family happy, it is perfectly fine to go for it. It is important to keep in mind, however, that no matter what the budget is, buyers should be careful that they do not overpay for a property just because they can afford it. It is always best to determine its market value and compare it with other houses.
Resources: http://www.mccarthyhomes.com.au/ http://www.businessinsider.com.au/7-investment-advantages-to-owning-a-home2013-6 http://www.movers.com/moving-guides/reasons-for-moving-to-larger-home.html