The great neighbor that lived across the street is moving. Basically, they are moving to a richer neighborhood (he’s an attorney and his wife is a nurse).
They bring in more income than we do… probably at least double the amount…
So just for some background information, their house is probably worth about $220,000 to $250,000 which in our city is a pretty decent house. They are moving to a house that is in the range of $400,000 to $500,000.
I think it’s a bad move, here’s why:
- They are only moving about 1 mile from where they live now.
- The Elementary School their kids will go to will be a worse one that they are currently at (more crowded, and a bit rougher).
- Based on who much they put into the house across the street, I’d say they are losing about $10,000 to $20,000 in enhancements and upgrades.
- The economy isn’t that great, anything is still possible.
- They need to start to build their non-retirement financial assets. I know they have a lot of credit card debt.
- They would have had their original house paid off in another 5 years.
- Their real estate taxes will increase by double (so it will be $6,000 a year).
- They’ll gut and refinish the new house like they did with the old one. I’m not even going to guess how much that will cost.
- They oldest kid is 14 and I don’t believe they have started saying for college yet for her.
So basically they are going to pay more that what it appears for this new house. At least they did get to take advantage of the fed tax credits for moving!
What do you think of such a move? To me it seems like a pretty large expense!