I want to sell our house and move to an apartment

[GirlBoyGirl]

Hi everyone, I am new here and am looking for your opinions!

I am a SAHM and we have 3 kids (2 toddlers and a newborn). When we bought this house, we had a total of 3 jobs (me working FT and DH working 1 FT job and 1 PT job and the PT job paid almost as much as the FT job!). Well now we are down to just DH's regular day job (very secure but doesn't pay much). After the mortgage, we only have a few hundred left for alllllllll the other bills. We have one car payment but DH's car could die any day now and we have my giant student loans which I barely make a dent in. We have really high utility bills too. We applied for a loan modification (Making Home Affordable program) MONTHS and months ago- in February, and STILL have not heard back. Should be hearing back soon but they have been saying that for ages now. Plus I recently discovered participating in this ruins your credit- which we have good credit so far.

So I would like to sell our house and get an apartment. Our mortgage is about $1400 and rent for an apartment big enough for us would be about $1000 plus less utilities and no repair costs anymore. It would be tight (or cozy, lol) with all of us in a 2 bedroom apartment but I think it would be so worth it. Much less stress. DH is hesitant because he thinks we deserve our house and of course he is right, but we don't really have any other option at this point. We have been staying afloat with our savings and that is just about gone. I would most miss our yard for playing in and our neighborhood for taking walks but we would make do.

What do you think? Is this something you would do?

TIA :)

[la mamita]

Is there any way you could downsize into a smaller/more affordable house, perhaps in a rural area nearby or in a neighboring town? I think that giving up having enough space indoors for the kids AND not having a place for them to play outdoors would be hard with three little ones. Maybe it would depend on the weather where you are, if you really can spend all four seasons outside at the park. How is the housing market in your area? Would you be able to sell your house and make a profit? Also, have you changed your student loans to income-based repayment? I would never be able to survive on my income without doing that....

[tinuviel_k]

You might have a hard time finding a two bedroom apartment who will rent to you. I'm sure all regions are different, but in my area a family of your size would not be able to get a two-bedroom. By law the apartment complex would need to rent you a three bedroom. You might take that into your price considerations.

[GirlBoyGirl]

Tin, that is a good point that I was not aware of, thank you! The 3 bedroom apartments are not too much more but still not as cheap.

Mamita, moving to a smaller/cheaper house is not really an option as that would cost too much in closing costs and I highly doubt we would find anything cheaper than what we have now unless it were a short sale in which case we would not be eligible since we have to sell our house/ a contingency.

Plus we want to move out of state eventually so selling our house now and renting for awhile would be the best idea if we wanted to make a quicker move later.

[nola79]

How much would you have to pay up front to move, though? Most places want 1st and last month deposits, plus you'll have to get your utilites transferred, and some places will even charge you for that.

[zebra15]

Can you even sell you home in this economy for what you owe on it? What are the tax implications of selling? What does selling your home do to your tax filing status?  Its not always 'cheaper' to rent.

I also agree with the PP that a family of 5 in my area would need a 3 bedroom

What happens to the laundry situation in a rental? would you be paying for a laundy-mat type thing or is there an insuite washer/dryer?  paying for laundry gets EXPENSIVE (around here is $2.00 to wash and $2 to dry per load)

[GuildJenn]

It might make sense but I agree with others that there are costs to moving and the tax implications are important.

I wonder if there is a way to make money from your house - take in a boarder in one of the rooms (since you are looking to go down to 2 bedrooms already). rent out storage, or childcare...something like that.

[summer_time]

We did just that!  We miss our house all the time, but there wasn't anything else we could do to make it work.  We tried!  Our mortgage + repairs were leaving us in the hole.  We worked our butts off and managed to sell our house in 8 hours (!!!) the day we listed.  We ,cleaned, staged, painted and priced it right.  We had lived there for a little over 3 years, so we had a teeny bit of equity that allowed us to pay off the debt we had accumulated from living beyond our means. Though we had a simple house, we couldn't afford it, and it took a lot of growth for us to suck it up and realize that our home was beyond our means.  Meet with a Realtor and go over the numbers (comps in the area, etc.) to see what you would make (or lose.)  Our credit is awesome now BTW!

Edited by summer_time - 11/23/10 at 12:56pm

[mnnice]

Originally Posted by GirlBoyGirl 

Tin, that is a good point that I was not aware of, thank you! The 3 bedroom apartments are not too much more but still not as cheap.

Mamita, moving to a smaller/cheaper house is not really an option as that would cost too much in closing costs and I highly doubt we would find anything cheaper than what we have now unless it were a short sale in which case we would not be eligible since we have to sell our house/ a contingency.

Plus we want to move out of state eventually so selling our house now and renting for awhile would be the best idea if we wanted to make a quicker move later.

I would consider selling and renting a single family house. 

Or alternatively you could try to rent your current house out and rent a cheaper one if market rate would recoup most of your expenses.

[*bejeweled*]

Hi, we sold our house and moved across the country to rent a 3 bedroom apartment. Love it! Oh my, I totally recommend it.
We love the freedom, no repairs, no extra costs (I have major student loans and we're living on a fixed income).

We rent in a great school district (*key) and DD takes the school bus right at the gate. Just make sure you rent an apartment on the ground floor that has green space around for the kids. Or a park within walking distance. Also, get a washer/dryer in the unit. We have no regrets. Only freedom & a great pool.

[Vaske]

Is there an income-based repayment option for your student loans?  Not great, but it might give you a little more breathing room in the short term.

I think I would not let the house eat up any more savings.  If it's not affordable, better for you to sell and get out sooner rather than later. 

We moved from a house we were renting to an apartment.  I did a lot of research on apartments in the area where we wanted to live, and found the place that had the lowest rent per square foot, while also having most utilities included, and green space outside for children.  Around here three-bedroom apartments are relatively rare, but not impossible to find. 

Since we were renting before, we didn't have to deal with selling a house.  The move was still somewhat expensive, but paid for itself within a few months.  The difference in cost ended up being hundreds of dollars a month, with cheaper rent plus less gas for commuting (moved very close to work), and very much less in utilities. 

We did make sacrifices, mainly in laundry facilities, project and storage space, convenient parking, and access to the outdoors.  With young children, it is nice to not have yard work (particularly snow shoveling) to keep up with.  We have had to downsize our Stuff quite a bit.

We do still dream about being homeowners, and are working hard toward that goal.  But I'm very glad that I'm not one right now. 

[dayiscoming2006]

That's pretty much what we want to do too. Owning a house is far more expensive than I realized and we really want to move to another state in the near future as well. I think buying a house was the biggest mistake we've ever made but hopefully we'll be able to get a decent price for it since we got by paying very little and have made some important changes to the look of the place with paint and new trim and redoing our wood floors etc.

I reallllllly hope it will work out but I totally get why the OP wants to sell. I'd go for it in that situation. 

[Stayseeliz]

We moved from our own 3 bedroom home to a two bedroom rental almost three years ago. I love it. Less stuff to clean, less money, fewer repairs. The only issue is the one bathroom. That gets a bit uncomfortable sometimes. We'll outgrow this house eventually since we're expecting #4 but we're going to stay here as long as we can.

Make sure to go over all the variables though and what you're willing to put up with. No washer/dryer, no yard, etc. We went from a house to a house so that wasn't an issue. It's a bit more expensive to heat and cool since we live in the city limits but that's the only thing we've noticed. This move shaved $600 of our monthly bills which was great for us especially since DH lost his job a week after we moved and had to build up another career!

[Sierra]

We're doing something similar.  I even started a blog on it: http://downsizingwithkids.blogspot.com/  (it's all very dreamy right now, but it's going to get down to the nitty gritty soon).  On the blog I only say that the reason for the move is me going back to school.  What I don't talk about is that (1) one of the things that pushed me to go back to school right now is that my salary was really starting to feel insecure in this economy and it didn't look much more secure for other folks in my same field, so I wasn't motivated to apply to be somewhere else where the same issues could arise just as easily, and (2) we were struggling along on my salary as it was, with only a 3% cut.  dw had intended to get a job when we moved to this house just a few years ago (she was a stay at home mom), but one thing after another (special needs stuff with our kids, some issues dw was having with anxiety, etc.) were getting in the way.  She has ended up doing in-home childcare, which has helped a lot, but the strain is still pretty great.  We are privileged in many ways.  Our kid both have special needs and receive some special funds that have paid for them to go to a private school that suits them (but that will end at the end of this year).  That's been wonderful for them.  But in terms of the month-to-month necessities, like you, after the mortgage (and some really high medical bills that I continue to pay off slowly), we are coming up short again and again.  We love our house dearly, but I think ultimately it may have been a big mistake. 

The house we owned previously, we probably could have just rented out.  This house is a different matter.  I've had it up on Craigslist, but covering the mortgage with a renter looks like it may not be possible.  We'll probably be putting it on the for-sale market in May.