Originally Posted by VLSI
Buy a house that's way too big for me that I can afford comfortably but will have a tangible impact on standard of living or buy a little town home and have much more left over play money? Also interest rates are stupid low right now and property prices are still low which is making a bigger house a more attractive use of my money.
Thats a little difficult to answer in a vacuum. depends on a lot of things People will respect you more imo, if you have a comfortable, well furnished house and money in your pocket vs. a large, empty house that you cant afford to furnish, and have no money left over when you're done with all your expenses. The term is house poor.
where that changes is if you are deliberately stretching. Perhaps you have a stable carreer with defined growth (if so, are you hiring?), perhaps you're in a stable relationship and a family is imminent. Perhaps your looking long term, as in this is a forever house. In that case, I would say its ok to stretch.
But just keep in mind, the cost of a bigger house is exponentially more compared to a smaller one. some friends of ours stretched into a very very nice 'forever' home. Its what we all would be buying in 5-10 years. But listening to them go on and on about having two furnances, and 3000 sqft to heat and cool, and the pool and the hot tub and blah blah blah and how the electric bill is 2x of their old place is kind of a drag. But fast forward 5-10 years, and that cost is no issue.
I'll leave you with one more example. Its like these dickheads who save all their money to buy a BMW when they are 25 and then cant afford to pay for an oil change because they are out of money and failed to take into account how expensive an oil change on a BMW is.