It can sometimes be an emotional decision, when you feel attached to a piece of property that you may have your heart set on. Be cautious, because many of the decisions you make around investment property. Most people are guided by the lifestyle that they would like to have, and not governed by the practicalities of the life that they need to lead. Your instinct might be telling you to go for the deal that’s “bigger and better”, but when practicality sets in, you realize that the larger the house, the more it will cost to get “house ready” in terms of painting, wallpaper, draperies and carpeting. A piece of land that’s on large lots also needed comparatively more time and money.
Three very crucial points when making the final decision on a property which relates to lot size, living space and associated accessories, appliances and furnishings.
When investing in property with larger lot sizes, remember that these come with larger price tags, in terms of the initial payment or larger subsequent installments. Maintenance costs will be higher. Lots located closer to the city’s center are more expensive. Yet if you decide on moving to the suburbs, you trade off the cost of greater driving distance and other conveniences that you have living nearer to the city.
Consider the example of someone moving from the city, by going for a deal that has a couple of acres more in the suburbs. While that may be a great move in and of itself, consider the implications. By making such a decision where the new location is 30 minutes further from existing conveniences, such as work location, shopping, groceries etc., it could add on a staggering 2.5 hours every week to their commute times.
Putting that in perspective, they give away roughly three weeks worth of time, that they spend commuting, for the “convenience” that is taken on as a burden with a piece of land with larger lots. That means more gas, and potentially loss of revenue in terms of unproductive time spent on the road.
Acquiring a land with larger area requires more maintenance that costs much more than just an arm and a leg. Perhaps you are lucky enough to have family members share the burden, but ultimately it does become one more thing that large-lot property owners worry about. By making an agreement on a particular piece of land, you not only own the inside of the house, but the outside as well. The larger the lot, the greater external upkeep required. Landscaping, snow removal, gravelling, salting, paving driveways etc. And it’s not just time that’s involved. Investing in property that has a bigger size means more investment in equipment, electricity, gas, seeds, fertilizer and other supplies. It all adds up!
If a prospective land is surrounded by woods, then you’ll have more on your hands than you think. The woods pose serious damage to property if not properly managed, trimmed and pruned periodically. Thunderstorms and lightning strikes are known to fell trees that cause massive damage. Land in wooded lots could cost you $500 to $600 a year on upkeep.
Unless yours is truly a growing family, its better to get more living space – just in case – is a luxury few can afford. So what if the in-law’s come visiting two days every year – use the home-office or the spare bedroom. And what if Jimmy is home from college for two weeks – use the couch. Consider the fact that, investing in property with one additional bedroom will probably come with correspondingly larger hallways, foyer, and common living space.
Moving into a property with larger living space will mean a correspondingly bigger budget to maintain and remodel the home, whether it’s time for a paint job, to change wall papers or lay down new carpets. And that also translates to more time using brooms, brushes and vacuum cleaners – unless you plan to hire a maid service.
Bigger piece of property would mean between $250 to $500 per maid service call, depending on the size and amount of cleaning to be done. As a rule of thumb, if you plan to up-size by 50% larger in square-footage than you currently own, you are likely to spend 50% more, in time and money, for upkeep.
Accessories, appliances and furnishings:
Most people prefer to have a place that is larger than their previous dwellings have a natural tendency to “fill the empty spaces”. This could mean getting additional sofas, coffee tables and wall hangings, fans and space heaters. If you are looking into a domicile that is relatively aged, you might even be tempted to replace existing appliances – furnace, air conditioning, and dishwasher.
Statistics from the Movecentral.com confirms that people that move into a home that’s larger than a previous home, whether owned or rented, have the tendency to also invest in newer or additional accessories, appliances and furnishings, either immediately or shortly after moving in. The costs for add-on’s when investing in property that’s larger can vary from $250 to $3,500.