Background:
- We live in a condo unit of 40 units. We own a corner unit. New bathroom 4yrs ago. Brand new kitchen with all the works done 2/2017. Complex built in 1946. 1,000 sqft, 2BR and 1BR. We don’t have much privacy with a shared front stoop and we live on a busy road, but in a very trendy neighborhood. We’ve lived here for 12 years and it’s been great. We’re now older and feel that we need to get a ‘final place,’ but we want to stay in our current neighborhood and add some amenities we’ve missed. This would be our retirement home.
- We owe approx. $89k on our current mortgage.
- We have an HELOC with a balance of $17.9k
- Current market value of our unit based on comps is $160k; could likely go for more given the new kitchen, bathroom remodel and corner unit.
- Household income is $105k/yr; $24k in student loans, about a rolling $1k of credit card debt per mo – never have late charges.
- We do not like yard work and do not want to do anything besides grow small gardens, etc (eg, we’re fine paying an HOA to do yard work)
What we’re considering:
- Selling our current condo and buying an upgraded townhome down the street that’s listed at $550k for 2,000 sqft, plus outdoor living space and a yard.
- It has a 2 car garage (we’ve been parking our cars outside on the street)
- More than 1 bathroom (2.5 total)
- Space for guests and storage
- It has a backyard and back porch (we have pets). The HOA does yardwork since it’s a large, private community yard for the 6 homes (it’s actually pretty cool).
- New construction with nice, new appliances
- Extra space/rooms that we can most definitely use
- HOA of $185/mo
Concerns/Addl Info:
- While we’ve been pre-approved, we’d be tentatively expected to lay out around $140k to secure a 30-yr fixed rate at closing. $55k would come from the current condo (has to be a contingent sale) and the balance would have to come from the 401(k) that has approx. $104k vested. Between my contributions and my company, I’m adding 13% of my take-home to the retirement fund, so it’s relatively aggressive.
- We do have an Edward Jones account, but we’re only at $1k. We’d probably have to stop contributions,
- My job is very stable and I’m doing very well after 5 years with expected growth. I’ve received 2 industry certifications, and working remote is always an option. Same for spouse, but income potential is not as substantial for him.
- We feel like this would be a long-term investment and we can just focus on this for our end days. We enjoy the city and neighborhood.
- The current property has been wonderful, but it does seem to be a younger-person transition area. We’ve never had problems, but we’re willing to struggle a little for a little bit to get some private space. We feel like we’re the ‘old’ people now.
Questions for you:
- Would this living/life change warrant an $85k withdrawal from my 401(k) for a very nice final home?
- We are just so tired of having to be ‘on’ whenever we go outside, and this new place would be so isolated and quiet.
- Are we crazy for jumping from our current financial situation to a mega-mortgage and 401(k) withdrawal?
- We’ve also run into a bunch of crazies in a 40 unit complex and this new one only has 6 units, which is very appealing.
Do we go house poor for a few years for a great living opportunity later??? All opinions/perspectives welcomed. Thanks!
Submitted August 24, 2017 at 11:47PM by J_for_Jules http://ift.tt/2wLbwHr
