Buying a Three Bedroom VS a Four Bedroom New Home

In the long run you're better off buying a four bedroom new home even if you never use that fourth room at all.

About.com says most people sell their homes within five to seven years. As you try to sell your home, more and more people will be looking for four-bedroom homes than looking for three-bedroom homes. So even if you don’t ever use that fourth bedroom for the five to seven years that you live in the home, that fourth bedroom may come in very handy when you turn around and try and sell the home.

Think of the question this way: Isn't it easier to try and sell a home that is a little bit too big versus a house that is a little bit too small? Most people say “Well it's a little bit bigger than we need, but we'll take it.”  But if it's a little bit too small, you've got no hope. Interest rates are so low right now that why not pay a little bit more for a four bedroom?

Dynamics are always changing. Maybe you’re single, or you have roommates or a partner, or you get married or you don’t. Maybe you have children. Regardless, of your current situation, families change.  Parents, friends, siblings, or grown children may come to stay at your home or even live there indefinitely.  Maybe at some point in time, you even decide to rent out the fourth bedroom. Things are always changing, and you can always adapt to too much space. But it’s very difficult to adapt to too little space.

There are a few advantages to a three-bedroom home over a four-bedroom home:

• a three-bedroom home costs less money
• a three bedroom home  is generally less effort and money to maintain
• lower square footage often means lower energy costs, which brings us right back to the idea that a three bedroom home costs you less to maintain than a four bedroom home

How many three bedrooms homes are being built versus four bedroom homes?

According to USA Today's article entitled “New Homes Still Getting Bigger” by Greg Toppo, June 8, 2013:

Three-bedroom homes still dominate overall housing: 47% of buyers of new and used homes picked three-bedroom models last year, while 26% bought four or more bedrooms, according to the National Association of Realtors. Data for new homes tell a different story.

The share of new homes with three bedrooms dropped from 53% in 2009 to 46% in 2012.New houses with four or more bedrooms snagged 41% of the market last year, their highest share ever. Smaller houses — two bedrooms or fewer — accounted for just one in five new homes in 2012.

If you have your choice, and the three-bedroom is all that's being offered and what you can afford, then that’s what you should buy. If you're in a position to choose between a three bedroom and a four bedroom home, and the price difference is not huge, then I would almost always pick the four-bedroom.

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