I was talking to my brother in law recently and we ended up talking about how much house we actually needed.  The reason this came up was the fact that he just purchased a place in a Denver suburb, and it was roughly a 900 sq. ft. bungalow with an unfinished basement.  It was nicely setup, and with only the two of them plus their dog he commented that it was more than enough space.  I commented that our house wasn’t much bigger at 988 sq. ft. and we honestly didn’t think we’d ever want much more space unless we had a rather large family (which there are absolutely no plans for at this point).  This took us down the road of wondering what people saw in such huge houses besides a status symbol to show off.  As a fairly lazy dude who isn’t a big fun of seeing his Saturdays spent doing housecleaning (and yes ladies, I am a modern man and do my fair share), all I could see in a large house was endless dusting and vacuuming.

Size … uh … doesn’t matter?

The really interesting thing was that the next night we went to see some family friends who lived in a much wealthier suburb of Denver that had a very pretentious name (you likely know the type).  Anyway, I never realized just how cheap housing had become in the USA.  I knew that the housing crash had hit some areas hard, but I guess I never realized how much cheaper raw materials and labor was as you got close to the Mexican border.  The family friends had this massive house that must have been between 3,000 and 4,000 sq. ft. (I have a difficult time estimating at that size since I don’t have much practice!), with two floors and a finished basement.  Plus, it was brand new.  It had all the aesthetic perks you’d expect a new house in that area to have, and it even came with about 20 square feet of lawn (apparently this is a bonus feature in wealthy suburbs).  When I later commented to my in-laws that the house must have cost a fortune though, they responded by saying it probably cost around $325,000-$350,000.  I couldn’t believe it, I mean in many Canadian cities you expect to pay that for a basic condo these days!  When I voiced my distaste at the thought of maintaining and cleaning a house that size they laughed and informed me that there was plenty of cheap labor available these days to take care of that sort thing if you didn’t mind the idea of someone doing your cleaning for you.

Happiness Per Square Foot

This really got me to thinking.  It had been a long time since I had been anywhere south of Minneapolis in the USA and I never realized just how plentiful MASSIVE homes are down there.  Whole suburbs that make almost anything I’ve seen in Canadian cities looking modest by comparison.  I wondered what the corresponding happiness level was according to square footage of home owned.  I looked for a study of any kind on the idea but couldn’t find one (my conspiracy theory is that the realtor lobbyist group must have paid big bucks to ensure this never happened).  I guess some people just look at the world much differently than me.  I’m definitely not one of these ultra-minimalist individuals, or a great philosopher-type that refuses to take pleasure in materialistic pursuits of any kind.  I just don’t get what you need all of that space for in a house, or what makes it desirable.

Hidden Costs

I believe there are many people out there that look for the largest home they can afford because they’ve been conditioned to believe that will make them happy, and their realtor happily tosses around clichés like, “Get the best home you can afford because real estate always goes up in value.”  Then they get in real trouble when they realize that the sticker cost is only the beginning of the real cost of owning a large home.  When you take into consideration the following costs, your monthly payments can skyrocket in a hurry!

  • Now that you’ve purchase a house with 10 rooms in it you need to furnish all of them.  Better sign up for one of those warehouse club things!
  • You can’t be the only one in the neighbourhood without a boat and trailer right?  If you bought a house in an affluent area, the Joneses you race to keep up with will be that much harder to one up.
  • The higher the value of your home, the more it costs to insure.  Kiss that much more money goodbye every month.
  • More square footage means more heating and cooling.  I’m guessing it isn’t cheap.
  • A larger house likely means more appliances that are hooked in all the time, and this will result in a higher electricity bill.
  • It simply costs more to re-shingle 3,500 sq. ft. of room than 1000 sq. ft.  More rooms means more carpet and/or flooring, more painting etc.  Maintenance is a time and money black hole I try to avoid while still if at all possible (while looking civilized).
  • The taxman loves new properties, especially if they are huge and located in affluent places.  At last you’ll know you’re doing your part in terms of supporting your community.
  • Not only will the taxman take more money from you, but their best friend the bank will suddenly love you as well.  Since you’ll be paying a huge principal price on the house, you will almost assuredly need a larger and possibly longer term mortgage.  This could result in hundreds of thousands more in interest charges over the life of a mortgage relative to a more humble dwelling.

At the end of the day, like all luxury purchases, if you have the money and if it makes you THAT happy, go for it.  If you have six kids and the financial means I can definitely see the plus side of the equation (although I’d want a big yard in that case too).  Personally, I don’t think anything over 1400 or so would increase my happiness at all, so it is a terrible investment in terms of pleasure-per-dollar for me personally.

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