I had lunch with my friend Cameron a few weeks ago. Over plates of Kung Pao Chicken and Mongolian Beef, the conversation drifted toward personal finance. We began to talk about the repairs and upgrades we've been making to our homes.
Kris and I bought our current house three years ago; Cameron and his wife bought their home two years ago. Both were big upgrades from what we had previously owned. And though neither couple spent more than they could afford, we're now realizing that bigger isn't always better.
Our first house was a 1365 square foot ranch-style home on a 7500 square foot lot. It was an unremarkable house, except that it was located in my home town. We could walk to the grocery store, to the barber, to our favorite restaurants. I could bike to work. If we still lived there, we would be paying off the mortgage next spring.
But I had always dreamed of a bigger place. I wanted a home with acreage. When we found a hundred-year-old farmhouse nestled close into Portland, we bought it. Our new house has 1820 square feet on two-thirds of an acre (less land than I wanted, but enough). We love the place. After three years, though, it's clear that 1820 square feet is too much for the two of us. We have two rooms that remain essentially unused, but which we furnish, heat, and cool nonetheless.
Cameron also had a modest ranch house on an average lot. When his wife got a good job in a different part of the state, they bought a bigger place. It's a wonderful home: huge floorplan, five acres, an amazing view. But Cameron, too, is beginning to understand that upsizing has unexpected costs.
Don't misunderstand me: both of us love our houses, but we've come to realize there are trade-offs. Too much house is as much a problem as not enough. “I feel like I'm always cleaning,” Cameron told me. “I feel like I'm always doing yardwork,” I said. There are other considerations, too, some of which are obvious, others less so:
- A larger house generally brings a larger mortgage.
- A larger mortgage means more total interest paid over the life of the loan.
- A larger home has higher utility bills.
- It costs more to furnish.
- And from our experience, larger homes have more things that can go wrong with them.
Cameron and I talked about remodeling projects, about long-term plans, and about what we've learned since moving. “We'll never use all the space we have,” he told me. “And with two young kids, it's all we can do to keep up with maintenance.”
“My values have changed,” I said. “I always thought I wanted a big house. I thought that was a sign of success. I don't believe that anymore.”
That's the crux of the problem: What was important to me three years ago is less important to me now. In Stumbling on Happiness, Daniel Gilbert writes that it's difficult for the present You to predict what will make the future You happy. You do your best, but sometimes the future You looks back and scratches his head wondering what his younger self was thinking.
Neither Cameron nor I intend to move, but we now appreciate the advantages of a smaller home, advantages we didn't recognize when we had them!
Last year, NPR had a story on the ever-expanding American dream house, which looked at the pros and cons of large homes. Though this piece actually discusses very large homes, it still explores issues like the reasons large houses have become so prevalent.
The inspiration for The Not So Big House came from a growing awareness that new houses were getting bigger and bigger but with little redeeming design merit. The problem is that comfort has almost nothing to do with how big a space is. It is attained, rather, by tailoring our houses to fit the way we really live, and to the scale and proportions of our human form. Two must-read articles about this topic include Cultural Creatives: The Rise of Integral Culture, by Dr. Paul Ray and a recent interview with William McDonough in Newsweek magazine entitled Designing The Future.
Finally, for years I've been fascinated by people who choose to live in ultra-small houses. How small? The Tumbleweed Tiny House Company has plans for homes as small as 40 square feet! Really, though, I'm more interested in their 392 square foot glass house, or the 100 square foot EPU (which you can build for just $19,000 plus labor). You can find more homes like this at The Small House Society.
Author: J.D. Roth
In 2006, J.D. founded Get Rich Slowly to document his quest to get out of debt. Over time, he learned how to save and how to invest. Today, he's managed to reach early retirement! He wants to help you master your money — and your life. No scams. No gimmicks. Just smart money advice to help you reach your goals.