Many prospective homeowners specifically look for a home they can “grow into.” They know their family and their needs are going to change in the coming years, so rather than buying a home that suits their current situation perfectly, they look for a home that could potentially serve their situation for years to come.
This is generally a good strategy, but it isn’t a perfect one, and there are some important caveats and considerations to keep in mind before you follow through on this type of purchase.
Key Areas of Growth
There are a few key dimensions of “growth” that the average homeowner will consider:
- Home size. The number of bedrooms, number of bathrooms, and total square footage of your house will dictate how many people it can reasonably accommodate. If you’re buying a home with a spouse, you may plan to have a couple of children. That means you’ll need more space for them to run around and play, and possibly bedrooms they can call their own.
- Financial capabilities. You may also anticipate being able to afford a bigger house in the near future; for example, a promotion may be around the corner, or you may be getting consistent raises, year after year. Accordingly, you may look at homes slightly bigger and better than what your existing salary might allow. Of course, lenders won’t consider your future income—instead, they’re going to look at your current and past income when considering whether to approve you for a mortgage.
- Amenities and local institutions. You may also look at the local institutions, organizations, and amenities in your area, even if you can’t use them right now. This comes into play if you’re planning a family; for example, if you plan on having children in the near future, you might want a home near a good school district and/or near a good park.
What Are the Risks?
Buying a home to grow into can be advantageous, since it helps you avoid outgrowing a home and keeps you comfortable for longer. However, there are some major risks to keep in mind:
- Financial instability. Buying a bigger home, or one with better provisions, is going to cost you more money. If your income suddenly drops or if you’re faced with unexpected expenses, it may be tough for you to keep up. If you fall behind on your mortgage payments, or if you have to strain your budget to make ends meet, it can be both stressful and damaging to your financial wellness.
- Bigger homes demand more intensive maintenance and upkeep. Having more space is nice, but that’s also more space that you’ll have to clean and maintain, and it presents more opportunities for things to go wrong. This won’t seem like a big deal when you move in, but over time, it can eat up your time and money.
- Unexpected developments. It’s not possible to accurately predict the future. As the years pass, you’ll find that at least a few of your expectations become unmet. Having more or fewer kids than you thought, or dealing with a massive career change can render all your planning useless.
Setting the Right Timeframe
How far ahead should you be planning for your future needs? If you just got married and you plan on having four children with your spouse eventually, should you get a house with four or more bathrooms, or start with two and a half? It takes many years to build to a family of six, and much can happen in the meantime.
It’s tempting to look far into the future, but the further ahead you plan, the less easily predictable your needs will be. On top of that, the gap between your “current” needs and “future” needs gets bigger, which means you’ll spend more time dealing with unnecessary space, maintenance, and costs.
For most families, it’s good to plan two to five years in the future. That should give you enough runway to plan for most upcoming future events, but without wasting much time or money.
In addition, it’s important to plan as conservatively as possible when making your future-oriented purchase. Finding a home to “grow into” often means spending more money, especially upfront, but if you’re not careful, this could quickly exhaust your budget. Does your budget incorporate maintenance and repair expenses? Does it anticipate cost of living increases like property tax increases and higher bills? What are you going to do if you or your spouse loses their job?
In most cases, it’s wise to buy a home smaller and/or less expensive than what you can actually afford, even if you’re trying to buy a home to grow into. On top of that, it’s important to establish an emergency fund of several thousand dollars to cover your expenses if your budget doesn’t turn out as anticipated.
If you’re going to buy a house that meets most of your hypothetical future needs, you may have to make compromises on some of your present wants. If you try to buy a house that’s perfect in every way, you’ll not only have a hard time finding that elusive “perfect” home, but you’ll also likely end up regretting what you do purchase.
For example, if you truly need the extra space in a home to accommodate a bigger family, you may have to choose an older home, which may require more renovations and maintenance. If you want a home that’s close to good schools, you may have to pass on certain optional features, like access to a big yard.
Buying a home is always a complicated decision, but it’s doubly tough if you’re trying to find a home for your family to grow into. Working with a real estate agent can help ensure you make the right decision, and take all the right variables into account. Contact Green Residential today to learn more about how we can help you find the perfect home for your family in Katy, Texas (and surrounding areas)!