Okay. Here is the scoop. I have been crunching numbers and looking at plans and weighing options for building our dream adventure lodge and have decided that a risk is inevitable. The question is how much should we risk? There are two options and I am feeling a bit like a chicken for leaning toward the going home option, because it is another delay in the process of achieving the big kahuna. However, I am just terrified that risking big might just destroy our credit and put us out on the street. Let me know what you think.
OPTION 1: RISK BIG
We can build this house and run a lodge with rustic luxury accommodations for up to 24 (4 rooms) overnight guests in the walk-out basement, and have room to run a reception hall with rustic luxury accommodations for up to 100 inside or 200 inside and out.
This would provide us with a realistic extra earning potential of $140,000 / year gross paying off the loan quickly and providing a beautiful place for our family to live. The advantage is that it is our dream and will work perfectly for the full-scale business we want to run. The drawback is that at the cheapest, if we do a LOT of the work ourselves, it will cost $500K, and even if by some miracle we got the mortgage rates on that big of a loan, the monthly payments would demand that the business be successfull right away.
OPTION 2: GO HOME
We can build this house adding a walk-out basement, log siding and wrap around decks, and run a bed and breakfast with rustic luxury accomodations for up to 10 overnight guests (2 rooms).
This would provide us with a realistic extra earning potential of $46,000 / year gross paying off our mortgage more quickly and providing a place to live. The advantage is that we could do this for under $300K and could make the monthly payments on this mortgage even if the business flopped. It would also provide us the opportunity to build equity and save up for the Big Risk when we know what we are getting into, can afford it and well, when it isn't quite so risky. The drawback is that the place is more of a home than an adventure lodge, and we would have to move again to make our dreams come true.
It is still going to be a risk either way, but going home would be a significantly safer, round-about way to the dream. I'm leaning toward going home; what do you think?
5 comments:
I am not much of a rist taker so I would go with option 2:Go home. The good thing about that option is that it is still leaving the door open for you dream. It may not happen as soon as you would like, but it can still happen and not be such a big risk. If you take the risk and it doesn't work you will have to start over and will be even further from you dream. I vote for 2!
I'm with Tori. Option 2 sounds like a good way to get the door open for Option 1 in the future. Option 1 is just too scary for me.
I'm with them! It seems like you could use option 2 for a practice run as well, work out the kinks, and then you will know exactly how to do it for option 1. One other tought also, I haven't built a home yet, but it seems that most of my clients (and everyone else I know that has done it) seems to inevitably go over budget, so chances are Option 1 might turn out to be an even bigger risk-even scarier!
Ditto, Ditto, Ditto. It sounds like you are leaning towards Option 2 anyways, and you are a bigger risk taker than most people I know. Plus, if Option 1 were to bomb, you would be even that much further from getting back on track.
I'm a go home kind of girl. Especially when it concerns your family in such a big life changing way. It sounds so fun! Good luck!
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