Considering Downsizing

Consider your quality of life too. Sounds like you are in an IDEAL area... and kids are happy. I'd stay if you can and find other ways to cut expenses or bring in more $$$ (pt job?) to save more money for buying. I wouldnt' move twice if you can help it.

It seems to me that you could cut $150/month in other ways, and it would be a whole lot easier than packing up everything you own and moving! Get rid of cable - there, done! I don't know what houses cost in your area, but if you qualify for FHA financing, you only have to have 3% of the purchase price to put down. All things considered, I'm sure you could save up that much without too much trouble, right? We save 10% of our income into savings automatically. You would be surprised how little you actually feel that. If you have direct deposit of your paycheck, just add your savings account on and have 10% go directly into savings. Within a year, you'll have enough for your down payment. Meanwhile, slim down in other areas. Cut your own lawn, buy generic brands at the grocery store, that kind of thing. I don't think it's necessary to move into a small apartment to make that happen, I really don't. Good luck with your home purchase!

First - find out what you are qualified to purchase and see what your payments would be, what you would need for a down payment. Get that information FIRST.

If your husband was prior service - does he have his DD214 so he can qualify for a VA loan?

Can you find a house that is in that price range?
Is it better or the same as what you currently have?

Since a mortgage would be more than $850 a month, I would see what I needed to save for. I personally wouldn't move. I would work with what I have and save for what I need.

You can control the electrical and water prices at your current place. You can turn lights off behind you. Turn the AC up to 78 instead of lower. Only run the dishwasher when it's full. Limit your showers. There are things you can do to cut back NOW. It's just a matter of IF YOU WANT TO.

I would get the information I needed to be able to make an informed decision. Then proceed. If you have debt - then I would focus on getting the debt paid off and living within my means before I ventured into home ownership. I know many people on here recommend Dave Ramsey or Suze Orman - and I do as well - take control of your finances - don't let them control you.

I'm sure there are things in your current place that you could get rid of to help pay off debt or put towards a down payment. Sell things at a garage sale, ebay, craigslist. If you are willing to downsize, then start purging your home and making things that you are not using work FOR YOU instead of against you.

Good luck.

Renting wise, 2 bedroom apartments are usually more expensive than renting a 2 bedroom house... especially in your area. We live in an older 3 bd home and ten is $950, but the 2 bedroom apartments around here are about that much or more, (well, some are less, but they are really scary with a lot of crime). As for us, we take care of our lawn, but we don't water very often, so the water bill isn't that much higher than it was in our apartment.

If you think about it, you will have to pay movers, pay another deposit on an apartment... that alone is about what you will spend on water and electricity in your small home... so that will go against your savings. So, I wouldn't move, but I would continue to save and work on cutting out small expenses wherever you can in your budget.

I feel like we have a lot in common housing and money wise, so I'm only going with the thoughts I have on the subject as it also pertains to us.

Hi T.
I will tell you about us. When we got married I always presumed that we would buy our own house .We were actively looking,had talked to the bank ,loan agreed etc.
Then about 3 yrs ago recession hit hard here in Ireland .The value of houses are slashed, the value of a house down by 50% in a lot of areas. So many people here are suffering financially living in houses with negative equity and massive mortgages .
I thank my lucky stars that we did not find a house to buy at that time.
After much thought we decided that we will never buy.
I think ,why put us under such pressure for the next 25 yrs paying back a massive loan on a house that we will not own until we are 65yrs approx.
Also before there was always the option to sell up/make profit and move on to a new house. That's not the case anymore. I don't want to commit myself to one house,one area ,one town for the rest of my life.
Renting is the option for me now. We can have all the advantages that comes with renting.
Yes I think you are being practical to rent somewhere cheaper while ye save money.
I understand when you say your husband's pride, the area etc ,mine is like that to.lol
Best of luck with new venture.
B. k

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I'd stay put. But I am basing this on me and MY family. Your may see it entirely different when you think of your family. Apartment life is not the same as living in a house. You have to deal with close quarters. Worry about the noise your kids are making. It would be an MAJOR adjustment. You have to think about the quality of life you'd have. You may think it's only a year. Then it's time to buy the house and you can't find "the one". Before you know it, it's been two years of cramped quarters away from the neighbors and friends you love.

It is a lot of work to move. And moves are expensive. Even without the deposits, they are not cheap. Running back and forth with trucks cost gas. You usually have to "pay" in beer and pizza :), if nothing else. Cleaning a rental property can add up too. And I know friends that actually pay more in the way of electricity since moving to a smaller apartment. They did not consider that it costs more to cool on higher floors before making their move.

You are right, this is a great market for buyers! If it were me, I'd probably work on downsizing at the house you are living currently. Sell the unused stuff at craigslist. Work on lowering the electric bills and water bills. Get a digital thermostat that will shut off when you are not home and start cooling just before you get back home. Get rid of cable. Get your phone down to the basics - no long distance, no caller id (with cell phones, do we really need all that). Think about all the little "extras" you pick up in Walmart. How many times do you run in for milk and wind up spending $20 of stuff you "needed". THose small things here and there really do add up...and it adds up fast. Really evaluate spending habits and I bet you'll see places to save.

We are a pretty frugal couple, but not cheap. We scrimp and save and do without, so we can get those bigger things that we need and want. My friends tease me because I know all the cheap and free entertainment around town and I am not afraid of hunting for a good deal. But we also know that no amount of money is worth being unhappy over. If you move, will your family be on board? Or will they be sad and resentful? THis is only something you can determine. Good Luck!!

I'd go ahead and work on trying to buy. That would make the most sense to me.

You will have to put your personal belongings somewhere so you'll be paying a hundred or more each month for storage rental. That will also be uninsured so if they get wet or destroyed in storage that will be an extra cost for your family.

Houses can't go down much more can they? It seems they have pretty much hit rock bottom price wise. I can only think if I had the opportunity to buy something I would just on it and take off running.

I would not do anything different if it wasn't going to make a HUGE HUGE difference in our qualifying criteria.

When we were looking for a home we had all kinds of things on our credit stuff. We had accounts with all kinds of places. We didn't owe them money but it showed the accounts. That meant that even though we didn't have anything charged we could pick up the phone the next day and order a bunch of stuff and owe them big bucks. So that effected our ability to qualify.

Hubby called each and every place and canceled our accounts. He paid off a credit card each month and canceled it. We didn't owe more than a couple hundred on any of them though.

He paid off everything he could one thing at a time. We qualified for double his yearly salary.

You would also have so much stress from the move, I can't imagine putting 3 kids with such an age range in one bedroom. If they are different genders the manager may not even consider renting to you.

There is no way a 17 year old, a 4 year old and a 3 year old can share a room T.. I think this idea is just not doable with the size of your family. 5 people in 4 rooms is just not a good thing. No matter how much you think it would work and be fun, it's just too stressful.

A friend of mine has 2 kids still at home. One boy and one girl. She is a neat freak to the max and always has an immaculate home. They lived in a nearby apartment and they were awesome renters. Always on time, no complaining, clean, no bugs or loud stuff. Kids were well behaved, etc...

They got evicted due to the kids all getting to school age. It was against their policies for different gender kids to live in the same bedroom. HUD won't allow it so many apartment complexes do the same standards.

I think focus on getting qualified and get a house as soon as you can. Once you move in it will be so much better.

Its expensive to move. Think about deposits and or first and lasts months rent and the likely hood of not getting your deposit back on your current rental. And how long do you want to save for 12 months? You'll need a 12 month lease if you don't want your rent raised. If you qualify for a zero down loan, is there really a need? First I'd figure out if you qualify for the zero down since thats a deal breaker. Then start working with a broker to see what you monthly mortgage will likely be and what kind of house that buys you. I know for us we really want to put a lot down to lower our monthly payment, so saving up is big. we are also considering downsizing for the next 12 months while we work on our downpayment. Do what you have to do, but make an informed decision by qualifying for the loan first.

It's good you're thinking frugally, so many people do the opposite. The only downside is it may be hard to have a whole family in an apartment. You have to put up with other people's noise and kids get antsy without their own outdoor space. Lots of people do it, so it can be done, but only you and your family can decide.

I think your idea sounds great and very smart.

We currently own a home (or at least, make mortgage payments). I looked into cutting expenses by renting, and it was more expensive to pay rent than to pay our mortgage. We bought our home 6 years ago.