Does this move make sense?

Robi · August 2, 2006, 2:57pm

In another thread, wbow wrote: “we have lived in so many houses, that we never get sentimental about the house, but we are all quite sentimental about the people who live with us!” That sums up how our family feels about the matter. Since our kids were born, we’ve lived in 9 houses (well, 2 of them concurrently.) Homeschooling made all the transfers easier. The latest is only a year & a half old, and dh & I are already thinking of another move. Here’s our situation - your feedback would be appreciated as I am having trouble being objective about this decision.

Two years ago we had a house built by a small production builder to use as a “dorm” for ds & dd who attend the same university (dd had a horrible freshmen experience in the residence halls.) This floorplan is now being sold by our builder a couple of blocks away for over 30% more than we paid, and he has only a few lots left. Resale, whether in one year or three years, should be good. Meanwhile, the kids have enjoyed living there & we’ve had a comfortable place to stay when visiting.

Not long after that house was completed, we had the chance to build a new primary residence. We upgraded some things that most buyers of resale houses will not pay extra for, such as the HVAC system, and included a number of universal design features that address some health problems which dh & I have (plus could be suitable for aging in place.) We will take a loss on sale if we sell within the next few years. Oh well.

The new house is about 45 mins. south of the city where dh works & about 2 hours south of the “dorm” house. During its construction, dh thought he was about to be invited to resign & he also experienced some serious health problems (probably job related.) Since then, there have been other developments at work and it’s quite possible that dh may not be there for more than 2 yrs. before taking “early retirement.”

Fortunately, we’ve been very frugal. Both houses are paid for and we have zero debt. Income will soon get a boost from deferred compensation payouts. The kids have multiple academic scholarships, so the main college-related expense outside of textbooks is running “their” house.

The guy who built our dorm house will soon be building in other neighborhoods up there that could be appealing post-retirement. He offers a house in the new neighborhoods that’s 50% larger than our dorm house & about 10% larger than our main house.

We could all live comfortably together in the new house while the kids complete college/grad. school. They’d have the upstairs mostly to themselves (bedrooms w/ private bathrooms, large recreation room, and laundry room w/ space for refrigerator & microwave) while we’d have a spacious main floor. It could be complete before the fall '07 semester begins. Dd’s commute to the university would increase maybe 5 minutes. Ds will graduate early & plans to work overseas next yr., and may or may not return for grad. school. If we opt to not do this, dd would be living alone for at least one year and more likely three. She says she likes the idea of the new house & would be happy living together again. I doubt that ds would feel the same, but he may not be returning to the area anyway. She is more of a homebody & wants to work in that area after grad. school. We’d be concerned about her safety living alone, as well as being lonely, although I do realize that she will most likely live alone eventually.

After the sale of both current houses and the purchase of the new house, we’d have over $200K for more liquid investments (after closing costs, moving expenses, upgrades, landscaping, new furnishings, etc.) I estimate that we’d save about $12K per year by eliminating prop. tax, HOA fees, ins., utilities, etc. for one house. OTOH, dh’s commute would increase by 30 mins. each way so gas expenditures would increase for commuting (somewhat offset by none of us making the 4 hr.roundtrip for visits.) However, dh’s employment may not be for long.

While I would not describe the latest floorplan as my dream house, it comes close enough that I could be happy in it “forever.” It’s also likely to be easy to sell at a profit, given the local market, should we ever decide to make an attempt at a truly custom house on 10+ acres outside of town. Dh is not ready to make that investment of time and money yet, and the location would not be as convenient for dd (or for us to go to museums, theaters, etc.) Nor does he want to buy/build a house in one of the more upscale neighborhoods close-in (cost = to both current houses.)

Dh says that he would not mind the extra drive time - he’d just borrow more books-on-cd from the downtown library. We both like the university city more than the city where dh works. The area immediately adjacent to our current primary residence offers more nice restaurants & shops than the proposed neighborhoods, but we don’t often patronize them. The current neighborhood has greater prestige, but I really try not to care about that sort of thing (dh doesn’t even think of it.) The biggest downside to the new house would be living with construction nearby until the neighborhood is completed (usually 2 - 3 yrs. for this builder) but our present neighborhood’s developer has opened several new sectors recently, so we’ve been enduring that here. Of course, moving is always a joy.

We’re going to check out the proposed neighborhoods this month. Our decision deadline is October 1. We’d wait to sell the dorm house until after ds’s graduation next spring, and would empty it to repaint & prep for sale to make it look like the new models. Depending on the market, we might put the primary residence on MLS sooner.

The reactions of relatives & friends to building the dorm house were SO stunned/shocked/incredulous that we anticipate mostly negative reactions to this idea, too (if we do it, we may not tell anyone until we send out new address cards.) Most of them later said that it seemed like a smart idea financially, but that they still wouldn’t do it out of fear of how the house would be treated (wild parties, trashed kitchens, etc.) I never worried about that. In this case, my guess is that the same folks would not want to live with their adult children, or that their children would not want to live with them. Maybe y’all have some different perspectives that I haven’t yet considered. Sorry for being so wordy - I appreciate it if you’ve taken the time to read this far. If I’ve left out any pertinent decision factors, pls. ask.

latetoschool · August 2, 2006, 10:37pm

Robi, this is a lot of information to consider, but, I’d go for it: you and your husband like the university city, and the financial side of it pencils nicely.

The only wildcard is that you should consider that your son will likely not live there, and your daughter may move very far away after she graduates. In that case, are you and your husband going to be happy living in the new house all alone? If so, then, there is no reason NOT to go for it.

We have sort of a similar situation in that I own one house in our primary city, and, since D graduates this year, undergrad costs are done and gone, so, we are looking at a second home in her college city, which we love. I spend a lot of time now mostly living in “her” apartment in the college city (which I pay for).

Advantages: we have an awesome relationship and get to spend lots of time together; I travel for business a lot, and she travels for athletics a lot, so we get lots of space; there is a safety factor in that we watch out for each other; there is an economy of scale of sorts in that we manage the resources and the maintenance cooperatively. Her friends come over a lot and I end up being their source of adult guidance on some issues, and they enjoy being here, and they invite me to a lot of events (which I can never seem to get to). D also invites me to a lot of events at her college, and many of these are awesome, plus we will usually grab a bite to eat and have an outing of it.

Disadvantages: I am not a college student, and do not keep the same lifestyle. (Schedules are very different.) The house in never trashed, but, once or twice I have come in from several days of travel and long flights to find dishes piled in the sink, etc. Also, in spite of awesome relationship, my gut sense tells me that my very presence may slow down D’s complete development towards independence and maturity: it’s too easy for me to do things for her that my tummy says she should have the full burden of doing herself. But this could be a positive too in that because I can support her by cooking a meal or doing a load of laundry, she has more time to spend on ECs and other work at school etc. You may want to consider this carefully - is it better for the college student to be completely, totally away from their parents, regardless of how terrific the relationship is? In my case it’s a moot point as she will certainly go to some other city for grad/law school, most likely in the northeast. (Meanwhile, we are meeting with a realtor this weekend to look at a second home in her college city, and we may buy, then sell our original home - we may also buy in a third city that we are carefully considering - didn’t decide that part yet.)

I think if it makes sense for you - if your children like the idea and your husband is happy about it - go for it. Don’t worry about other people’s negative reactions; all families are different, and each has to do what works, and what makes them happy. I do have to say that in our case, I do NOT think this would work if we both did not have so many outside interests and serious travel schedules, and if we didn’t have a primary residence in another city.

Robi · August 2, 2006, 11:25pm

Thanks so much for your response, latetoschool. It’s amazing how helpful it was to just type out the idea, and even more so to read some positive feedback.

Dh & I talked it over again tonight, and he wants to keep our primary residence here for a year after building the new house there (should we actually go through with that plan.) That will give us time to base our final decision on the actual experience of living there and not just speculation. It will also help us to feel more certain that dd will base her choice of grad. school (& work location) on what she really believes is best for her since we’ll have kept our options open.

I appreciate reading about your experience with your daughter. The outings you describe sound great - I think that my dd & I would both enjoy that. Schedule clashes have been an issue with both kids for years, but we all try to adapt somewhat when we’re together.

If our daughter had not already lived away from us, I would be more concerned about stifling her independence but now I don’t think it’s a worry. Part of the appeal of this idea is being able to let her focus more on her studies & research and relieve her of some household responsibilities.

Once dh retires, we’ll be traveling more often. Until then, I hope to get involved in volunteer work again. In some ways it would be easier for me to focus on outside interests since I would not be shuttling back and forth as I have when one of the kids, or their dog, has been ill or injured. As for house, it’s certainly larger than two people need, but not too big to manage. Dh is adament about wanting to age-in-place and not go into an institution (hopefully not a concern for many years) and the new house could accommodate both visiting grandchildren & a live-in care giver.

Now I just hope that we’re not disappointed when we go to check out the new neighborhoods & what surrounds them. Dh fears it’s all too good to be true, but he tends to look for trouble.

latetoschool · August 2, 2006, 11:39pm

Robi, you make some good points re independence - D spent freshman year in the dorms, then two years living alone off campus - our current scenario is only a year old and was never planned, it just sort of happened driven by business issues. I do shoulder most of the household responsibilities, but then D gets to have lots more time with on campus activities.

I am also a fan of letting these things play out over time. The home I own, I leased it for a year first before committing to buy it, and I’d looked at houses for nearly a year before even deciding that - drove my realtor crazy. The second home purchase I have been studying for over a year. It is very, very difficult to decide when there are so many awesome, interesting choices. You’re smart to take your time and make sure you’re going to be very happy there regardless of what either of your children decide.

I’m also a HUGE fan of age-in-place. I promised my D that if she ever tries to put me in any sort of institution, I will simply run away. :)

bobby100 · August 3, 2006, 7:14pm

It seems very odd that people old enough to have 2 kids in college would think twice about what relatives have to say about your housing investments.

While dd says it’s OK now, anticipate that as she becomes older and more mature she will probably not want to live with her parents. A serious boyfriend would probably end that scenario real quick. It would be unwise for you to count on her being happy with that for long.

It also sound like you don’t live in the greatest real estate market. Not being to make money because you invested in central vac tells me you don’t live in California. The best way to make money in real estate in your case may well be to invest in REITS which invest in hot markets.

Anticipate that your kids will have their own homes and wait and build your dream home.

Robi · August 3, 2006, 10:29pm

Bobby100, I think you’re a tad confused about a few things. First, it’s been my experience that most adults value the opinions of those close to them especially if those people have some comparable life experience. However, no where did I state that our decisions would be based solely, if at all, on others’ reactions. Quite the contrary, I think I mentioned that we’d likely just announce our move after the fact. Unless we cut ourselves off from everyone, the subject will come up in conversation. Having led a very different life from our relatives and most of our friends, we’re used to being the odd ones out. However, I have a bad habit of second guessing some of my choices, so it can be helpful to solicit opinions of more objective people, such as the parents here.

Second, “HVAC” is NOT “central vac.” It stands for Heating, Ventilating, and Air Conditioning. Our HVAC system (18 SEER two stage w/ whole house purifiers) is far costlier than a high end central vacuum, hence the unlikelihood of recouping its cost within a couple of years. It’s also typical in some markets for resales to have difficulty competing with new construction, no matter how well appointed.

You’re right that we don’t live in CA, for which I am thankful (no offense to any Californians - I just happen to enjoy the low cost of living here.) In case you haven’t noticed, that RE market isn’t skyrocketing these days either. However, we’re satisfied to trade off big swing boom or bust markets for slow but steady growth. We’ve never treated our home as just another investment - our portfolio is far more liquid. Thanks for your advice, but between my MBA & dh’s CPA and nearly 30 yrs. of banking experience, we’ve managed our finances just fine.

For anyone else who’s read this far (maybe Latetoschool?), dh now suggests that we keep the “dorm” house and make a few upgrades. It’s a 4 bd, 3.5 ba. house, so it really should be big enough for the three of us to share after ds graduates next spring, especially since it wouldn’t be for very long. We’re still going to check out the new neighborhoods this month and may see if the builder/developer might consider selling us a lot w/o requiring us to begin construction immediately. I was feeling pushed to make a decision on the new house before other matters are settled in order to obtain one of the few premium lots, but maybe that isn’t necessary.

Dh also mentioned the possibility of giving dd the “dorm” house once she’s out of grad. school (assuming she still wants to settle up there.) He’d much rather be generous to the kids when they’re starting out than make them wait until they’re 50+ to collect their inheritance. We survived a flood, major theft, uninsured hospitalizations, etc. when we were young & poor, back in the days of 18%+ mortgages with negative amortization and nearly went bankrupt. A little financial help from our folks back then would have been 1000X more meaningful than our inheritance now.

DRJ4 · August 3, 2006, 10:58pm

Robi,

When I first read your OP, my initial reaction was positive. Now that I’ve thought about it for a couple of days, I realized why my reaction was positive - because you are so positive. Reading your comments, I can’t find a significant negative aspect that seems to concern you, although surely you have doubts or you wouldn’t have posted this. I urge you to make a pro and con list (3-5 words per item) as opposed to a narrative of how you feel about moving. I think it will make your decision easier.

Does this move make sense?

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