Bigger Home Costs Are Higher Than You Think

Bigger is always better, right?  People seem to think so especially when it comes to homes.  How many of us were raised by our parents in homes that we’d now consider much too small?  What people today consider starter homes, many lived their lives in.

There can be many costs involved with a bigger home.  The most obvious one is that they cost more.  A bigger home comes with a bigger price tag.  That makes sense.

Some people say this is worth it.  They look at the 500 extra square feet.  They see that it costs them $40,000 more.  Then, if they can afford the payments, away they go!

But, there are a bunch of other costs that come in that many don’t think of.  If you think that the only cost of a bigger house is the price, think again.  Here are a few things to consider.

Higher Taxes

If you pay property taxes, then you’ll pay more in taxes.  These costs will add up over the years.  For most, you’ll be getting the exact same services as those with lower payments.

Upkeep and Repairs

Eventually things wear out in homes.  A bigger house probably has a bigger roof.  There are probably more windows.  There is much more carpet.  More walls and ceilings to paint.  All of these things will cost you more over time to replace versus in a smaller home.


With a bigger house comes more space.  With more space comes more furniture.  All the extra furniture costs more.  And as your styles change, your replacement costs will be more down the line as well.


A bigger house means more space to heat and cool.  This will mean higher bills to pay every month.

Opportunity Costs

Every dollar you spend on your home is a dollar you don’t have to spend somewhere else.  Keep this in mind.  You might be sacrificing an investment opportunity.  Or an annual vacation.  Whatever the case may be, realize that you’ll likely be sacrificing something for your bigger home.

More Space To Fill

Have you ever noticed that when you have more space you fill it?  I remember my first apartment.  My roommate and I each had a bedroom closet and split one storage closet.  That was it.  And we made it work.  Now, I often wander through our house, with stuff in every room.  In the basement.  In the garage.  And I wonder how did I ever make it work in that little apartment?  The fact is that a bigger house will create more space and that leads to more stuff.

All of the things above will cost you money, and they all come from a bigger house.  Now, a bigger house might be just fine for you.  If it is, great.  Just make sure that you plan not only for the purchase, but for the extra costs you’re sure to face.

Readers, have you ever added up the costs of a bigger house?  Did these ever keep you away from buying a bigger house? What costs did I miss?  Let me know your thoughts and opinions in the comments below.


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Smart Single-Family Rental Investing

Opinions often vary regarding the advantages of investing in single-family homes (SFHs) over multi-family complexes (MFCs). Some feel the short-term potential of MFCs surpass that of SFHs. While others cite the long-term potential of the SFH as being a preferable trait. The reality is—of course—it depends.

What are your long-term goals? How much is your available capital? What is your overall tolerance for drama? Depending upon your answers to those questions, smart single-family rental investing in a city can indeed be preferable to multi-family rental investing when you take the following factors into consideration:

Lower Barrier to Entry

On the whole, it’s easier to get started with SFHs. In fact, a good strategy for young investors is to purchase a starter home in which to live while they save and help appreciation bolster the value of the property. Once their equity position becomes sufficient, they can then refinance the house to purchase a larger home. If you start at age 25, repeat this process every five years with 15-year mortgages and acquire your last property at age 50, you’ll have a nice home free and clear when you turn 65 — along with six paid-for rentals from which to derive retirement income.

Easier to Afford

Buying a SFH generally entails much less expense than acquiring a MFC. They are lower-priced, easier to finance and require much less liquid capital to buy. Plus, if you ever need to sell, they also tend to move more quickly when they come on the market—assuming they’re well maintained and in good locations.

Faster Appreciation

Single-family properties tend to appreciate more rapidly in cities than complexes do. The resell market is much broader for SFHs, as they can attract people who need to purchase a home as their primary residence as well as investors looking for nice rental properties to add to their portfolios. On the other hand, MFCs tend to appeal only to investors. As a result, the pool of potential buyers is smaller, so demand isn’t as great and appreciation happens more slowly.

Easier to Manage

Maintaining a SFH is much less involved than keeping up a MFC. In a rental house, you’re likely to have at best three toilets. In a MFC the number of units multiplies the number of toilets. Ditto appliances to fix, carpeting to replace, walls to paint and all of the other aspects of keeping your property in tip-top condition. Yes, good property management companies can relieve you of much of the burden, but even then, your costs are lower with SFHs.

More Desirable to Families

In general, SFHs are easier to rent when they’re in good locations because people with children prefer to live in houses. This also means your turnover rate will be lower because all things being equal, a family is more likely to stay put — as long as the place remains comfortable and meets their needs as a family. Further, most people with children prefer a neighborhood setting with backyards, trees and other like-minded people nearby. This is more likely to be the case in a neighborhood of SFHs, than in an area zoned for MFCs.

Fewer “Personality” Problems

Anytime you put a bunch of people in close proximity to one another, you’re inviting personality clashes. Yes, you can screen your tenants very carefully, but it won’t guarantee Tenant A’s preference for the Raiders won’t irk Tenant B’s love of the 49ers. In SFHs, the person who pays the rent calls the shots for the behavior of the occupants of the entire place. In a MFC the number of units multiplies this factor and everybody doesn’t have the same sensibilities, which can lead to landlords finding themselves in the uncomfortable position of arbitrator.

For these reasons and many others, many people prefer smart single-family rental investing in cities to multi-family complexes. Ultimately, it all depends upon the particulars of your individual situation.

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Smart Shopping: Top Tips for First-Time Homebuyers

Buying a home for the first time can be incredibly nerve wracking. With a few tips in mind, however, you can navigate this tricky experience to land a home that’s ideal for you and your needs. When shopping for your first home, be sure to reflect on the following advice.

Sweat Equity

Sweat equity is the amount of labour you are willing to put into a home to make it your ideal. Making improvements to you new home, especially if it’s an older home, is a great way to increase the home’s value as you improve your enjoyment of it. To find a new house, you can tell your property agent you are interested in a home you can fix up. Only, be sure that the required fixes are ones you have the know-how to tackle.

Know the Deal Breakers

When shopping for a house, you’ve got to understand innately what properties will have a poor return on your investment. Many prospective homebuyers will turn their back on properties that have a history of flooding or that have serious foundation and structural issues. Some people don’t even want to deal with the headache of old windows or a worn-out roof. When shopping, consider what elements of a home you don’t want and be sure to let your real estate agent know.

Choose a Knowledgeable Real Estate Agent

When you want to go house hunting in a particular area, it can be important to select a realtor who has experience and expertise in the area you’re interested in. Agents that know the communities can provide homebuyers with the information they need to know such as the nature of the schools, the types of healthcare centres in the area, and the types of shops that are in the vicinity too. Make sure that your agent understands your wants; if they continually show you properties that are outside your interests, you may need to find a different agent who is willing to work for you.

Get Pre-Approved

These days, pre-approval is a must. When you get pre-approved for a mortgage, you’ll know exactly how much money you have to play with. You may not want to purchase a home at your price cap, but at least you can avoid looking at homes that are well out of your price range. It can be quite disappointing to fall in love with your dream house only to realize that the bank won’t agree to approve a home loan for it.

Down Payment and Credit

Having good credit is essential for purchasing a home. You’ll also want to save for a decent down payment. However, don’t put off purchasing those new winter boots or jacket you need. Put them on your credit card. Lenders want to see that you have active credit. Just be sure to pay on your credit cards to keep your credit rating up. On the other hand, saving for a down payment is no time for spending frivolously either. You may want to avoid making pricey purchases on items that are not essential.

Explore the Community

When you buy a new house, you are also buying into a new neighbourhood. If you wind up thinking it’s absolutely boring, it might not be the best location for you. Be sure to explore the neighbourhood carefully when selecting your home. When trying to choose between two homes, you should definitely consider the impact of the location. Choosing the home that’s closer to your work place or public transportation might be a wise choice for you.

Have a Professional Inspection

Before purchasing your home, you’ll want your own inspector, someone working for you, to carefully inspect the house in question. You don’t want to move into your new dream house to find that the electrical wiring isn’t up to code or the furnace is ready to fail at the sign of the first frost. Once you have your inspection in hand, you can use it as a powerful negotiating tool. If, for instance, the home does need a new heating or air conditioning system, you naturally want to offer a lower price or request that the seller make the upgrade. They may not be open to the idea, but it’s definitely worth negotiating over.

With these tips in mind, you can begin your hunt for a new house. With a bit of patience and careful assessment of the properties in question, you’ll eventually find a wonderful place to hang your hat.

Sienna Walsh helps to arrange property funding options and is always willing to share her tips and ideas with an online audience. She is a frequent contributor for a number of relevant websites.

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Making the Downsizing Decision: Reasons It May Not Be for Everyone

The bulk of money and real estate experts laud downsizing as a fabulous way to get ahead, not just financially, but also socially, physically and mentally. The common advice to declutter and move to a smaller space is not as one size fits all as you might believe, however. In fact, some pretty compelling facts support the concept of staying right where you are with what you have.

Saving Money Might Be a Pipe Dream

Most homeowners who downsize do so in hopes that the move will cut their expenses. For example, they rationalize that they’ll come out ahead with a lower mortgage, reduced heating and cooling expenses and a trimmed-down insurance package. Unfortunately, other costs can negate what you might save. Taxes might be higher in your new neighborhood, for instance, or you could have new homeowners’ association fees to cover. You also need to consider the expenses related to the move, such as truck rental, closing fees, buying new furnishings, making necessary modifications or repairs, closing and opening utility accounts and travelling back to see friends and family members after you’re settled.

Even if you end up saving money when your downsizing process is complete, you still might lose out if you aren’t smart with the funds the move generates. If you are tempted to throw the extra cash into “dead” purchases like cars or vacations, which don’t provide a continuing stream of income, you might end up on less stable financial ground than if you had stayed put.


Reputable estate agents and other professional companies work hard to make your move as seamless as possible. Even so, downsizing is work–as in, a lot of work. It can be stressful to go through everything simply because of the physical energy it takes, but there are other emotional components, too. What you have likely has memories attached, and letting go of your stuff might feel like you have to let go of who you are. You also might disagree with your family members about what to keep and what to toss, which can mean big conflicts. Downsizing also can mean going to an entirely new neighborhood, which might widen the gap between you and your loved ones. Although that offers a great opportunity to make new friends, you might struggle as you distance yourself from those you care about.

Loss of Status

To many people, having a lot of possessions or a large house stands makes a statement. It shows that they have worked hard, played by the rules and earned some luxury. When you downsize, you have to distance yourself from this ideology. Your sense of accomplishment cannot have a material measure anymore, so you might feel a stark loss of prestige or embarrassment, even though you know that the downsizing process makes logical sense. Others might make this problem worse by asking you why you’re giving up what you have or prodding to find out if you’re in financial need.

No Centralization

Somefind that, after many years of living in a community or raising their children, their home has become a sort of Mecca.  In other words, it’s  a centralizing point where loved ones know they can come for support and company. If this is the case for you, you might need to consider how disruptive it really would be if you transferred to a new place.  What if you couldn’t entertain?  Moving to a new place wouldn’t necessarily be bad in terms of encouraging independence in others. However, it might not be worth it if the downsize would completely unravel critical links within your family and friend network.


Downsizing can be good in that being in closer quarters can encourage better and more frequent communication. Nevertheless, in a smaller property, you’ll likely have less privacy than if you had more room to spread out. If you’re more of an introvert, then a smaller space might do nothing but grate on your nerves.


Smaller properties usually mean less cleaning, but they also can become cluttered very quickly. That can lead to functionality issues and feelings of anxiety. You probably will need to be much more critical about what and how much you buy after you get into your new property.  This could make you feel like it’s hard to be spontaneous and enjoy yourself.


Downsizing indisputably is the right choice for many individuals and families. Still, it’s not appropriate for everybody. In some cases, it might be more trouble than it’s worth. Before moving forward, weigh these disadvantages against the potential benefits carefully.

Nicholas Moore has carved out a career in property and understands the pros and cons of downsizing. He enjoys sharing his insights with an online audience and writes for a variety of property and lifestyle websites.

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.