Whether it’s time for a new house, or time to move from the parents’ place, affordability is a concern. It costs money to move, into the thousands of dollars.
There are many costs to consider, but also ways to minimize them. Looking at the whole picture is the best way to decide if you can afford to move out. These questions and tips can apply to renters, as well as to home sellers/buyers.
How Will Your Basic Housing Costs Change?
Add up your housing expenses now and compare them to the new home. Include all factors: mortgage/rent, insurance, taxes, utilities, landscape and other maintenance, moving expenses, and even the cost of commuting to work. These numbers can vary a lot by location, so research your intended destination.
Consider changes to your work situation, which may include getting paid more or less for the same job in another state. And take a realistic look at your savings to cover up-front or unexpected costs. In other words, tally all financial resources.
Are You Selling/Buying a House?
If so, there are extra expenses to think about, including:
- Repairs and upgrades: Although work can be done inexpensively, you often need to invest in a house to get the best sale.
- Closing costs and other contract fees in the sale
- Pro-rated HOA dues or property taxes on either end.
- Realtor’s commission: No, do not do For Sale by Owner. Studies consistently show that a real estate agent is going to earn her commission with a significantly higher selling price.
- Repairs and upgrades again: Does your new home need work or have features you want to renovate? Even if it doesn’t, small expenses can still add up, from shower curtains to porch chairs.
Are You Renting?
- You still might need new curtains, shower or otherwise, etc.
- Landlords usually expect first/last month’s rent and security deposits.
- There can be fees for utilities and other services.
And whatever your moving situation, always have some funds in reserve for the unexpected.
Ways to Minimize Costs
It’s worth considering these possibilities for lowering expenses before you make a final decision about the move:
- If you’re buying or selling, find a realtor with a record of success in your area(s). This gets you more money, or at least a faster process, and time is money, too.
- Move as little as you can: declutter your life. If you have things you don’t need or use, then sell, donate, and recycle them. If you start early enough, you won’t be time-pressured into packing and moving things to “decide about later.”
- You can offer furniture for sale with the house. Or even a car.
- Move whatever you can yourself. Elbow grease and pizza cost less than movers. All those friends you helped move? Text them.
- Get written estimates from several moving companies, and compare.
- Consider a roommate or housemate to share expenses.
- If you’re relocating for your job, find out what your employer will pay for, including temporary housing, storage, and moving. They may reimburse you or offer a stipend.
- Get the tax deductions you’re entitled to. If your move and your job meet certain criteria, you can write off a number of expenses. Check out IRS form 3903.
- Don’t get bitten by the shopping bug. Decor fit for a blog may be tempting, but be real about your budget, and separate the Must Do’s from the Would Like to Do’s.
What Would Sherlock Do?
Take the time to research all aspects of your move, from packing expenses to income changes, and look at all your numbers with a critical eye. No matter how much you dream of moving, make sure it’s a reasonable thing to do right now. No one wants nightmares or sleepless nights when the bills come.
Investigate all avenues for saving money and lowering costs, to put you in the best possible position. Then you can move with confidence.