The Next Chapter

After going through The List we picked the second most challenging option – moving across state lines to the barrier islands of Outer Banks in North Carolina. The most challenging option would be moving to Costa Rica which we ruled out, at least for now. Living on the Outer Banks may not be as cool as somewhere on the beaches of Costa Rica but it sure beats staying in a landlocked city where we are now.

Both my wife and I grew up by the water. A beach was never more than 20 minutes away. After living 15 years without the ocean close by we are ready. Living at the beach has always been on the bucket list of things to do before we grow too old to really appreciate it. All of it – the good and the bad.

This is a full system reboot. We will be leaving behind our family and friends, a comfortable house, two stable jobs, one of the best school districts in the state… It is absolutely life changing and scary, no doubt about that.

But it’s also something that’s been long in the making. We’ve been talking about downsizing, moving and switching “careers” for many years. The time is right, we bought the beach house and we’re excited to see what the next chapter will bring.

Why now?

This year we decided that we’ll stay a one-child family. We bought our 3,200 sqft house thinking we’ll have 2-3 kids but it didn’t work out that way. We’re at peace with this decision and after lots of back and forth we’ve committed to downsizing. No matter how much we love our current house it’s just not a right fit for our family. Too much to clean, too much to maintain, too much in general.

And even though we have no mortgage there’s still the opportunity cost of having so much money tied up in the house. All this unused space is a constant reminder of wasted resources. To an optimizer like me that’s an unsettling feeling that can’t be left unresolved. The elephant in the room is the house itself.

We could buy a smaller house close by but that seems like more of the same just in a smaller package. We want some adventure and a renewed emphasis on simplicity. Moving to an island takes care of that.

Our son just started kindergarten this fall. The way we see it – it’s now or never. We can experiment while he’s in the elementary school and if it doesn’t work out we can always come back to a familiar environment before he starts middle and high schools.

The worst scenario for me would be to find myself as a 60-year old saying “why didn’t I try it?” That’s the biggest risk because by that time it’s too late. Not only that but I already know that there’s a 100% chance I will ask this question and have regrets if we don’t go for it now. Any potential downsides that may come from scratching that itch for adventure pale in comparison. I have a backup plan for each downside except for not taking a chance in the first place.

Why Outer Banks?

We’ve been coming here for the last 15 years. We stayed in hotels, rented houses and camped. We feel comfortable here and like the laid back lifestyle. Obviously it’s one thing to vacation and a totally different experience to actually live here full-time. We did talk with families with children that live here year round and we liked what we’ve been hearing so far. The next step is to actually try it. We won’t know for sure until we do it ourselves.

The Outer Banks are still close enough to drive to see our families. Certainly much easier logistically than Costa Rica. And, based on our conversations so far, we’ll need to start a wait list for friends and family that want to visit.

Pretty much all of the full-time OBXers we’ve met so far seem nice and friendly. I think you have to be when there’s only something like 30K people living here year round. People seem a lot less focused on material things, status and dubious achievements than where we are right now. That’s a whole other topic and another reason for the move all in itself.

 Flashback: I grew up in a 500 sqft apartment sharing a room with my sister. Looking back, I’m so grateful to have had this experience. I seriously doubt I’d have the same values if I grew up in a 3,200 sqft McMansion surrounded by all the easy-credit-fueled excess.

Why a Triplex?

We bought a triplex. The main floor is roughly 1,500 sqft which is where we’ll live. It has two bedrooms, two full bathrooms plus two bonus rooms which could function as a bedroom or an office or a play room depending on how we set it up. Unlike our current house, there is zero wasted space. It’s cozy but should be more than enough for the 3 of us (see Flashback above).

Since most OBX houses are built on pilings there’s space at the ground level. This area was built out into two small studio apartments. Each with its own entrance, small kitchen, full bathroom and HVAC.

But what about flooding?

The house is in an X flood zone which means it’s not supposed to flood or at least it hasn’t in the last 500 years. I specifically targeted only the X flood zone properties as it’s one less thing to worry about living by the beach. Deep down though we fully expect the ground level to flood as soon as we move in. That’s just the way things work.

Currently there are 3 sets of tenants living in the house – a family with one child upstairs and two brothers downstairs. They were all there when we bought the place. The rents cover all the bills and then some meaning our investment is cash flow positive. That definitely made the buying decision easier.

The plan is to ask the upstairs family to move out early spring so we can remodel and move in in June. We’ll keep the downstairs tenants at least for a year after that while we get settled in. This arrangement will provide stable income and require the least amount of work.

After that we will see… Some of the options on the table are:

  • Start renting the two apartments on Airbnb. This will require more work but should net more per year than a long-term lease. Another benefit is that there’ll be plenty of days and weeks where both apartments will be empty since most demand is in the summer months. In other words, we could potentially make more money in 4 months with Airbnb than in 12 months renting on a yearly lease. This gives us a break from renters and allows us to use the space for other purposes, like hosting family and friends.
  • Rent both apartments on Airbnb as one unit on demand. There is an interior door between the two units that can be unlocked, similar to hotels where they can combine two rooms for you. Friends, couples or families can enjoy this larger space.
  • Rent one apartment year round for stable income and Airbnb the other one.
  • Move downstairs during summers and rent out the upstairs to guests on a weekly basis. That should bring even more income while requiring even less work.
  • Exchange our beach house for another place in the US or abroad. We can vacation for just the cost of food and travel by staying at someone else’s place for free. There are several websites that allow homeowners to exchange houses all over the world.
  • Put all of our personal stuff in one downstairs apartment, get a property manager to rent out the main floor and the second apartment, and move to Costa Rica for a year. We could rent a small condo in Tamarindo, send our son to private school and have most of our living expenses covered with our US rental income. So we might end up in Costa Rica after all!

There’s even more but this should explain why we snatched up this triplex on the beach so fast! I really like the flexibility it provides. It can be as big or as small as we want no matter what we may want to do any given year. We can turn it into a gathering place for a family or a cash flow machine to cover our living expenses. Can’t do that with our McMansion!

Location, Location, Location

Aside from being designated as flood zone X, the other requirement was a central location. We wanted to be within biking distance to most places we may need on a weekly basis. The Outer Banks is way ahead of a typical American city in terms of bike paths. We wanted to be close to one.

Our triplex is a quick (and I mean quick) bike ride away from both the beach and the sound, grocery stores, big box retailer and home improvement stores, movie theater, gym, restaurants, library and a number of other places I can imagine wanting to visit. A 15-minute ride is all it takes to get to school – on a trail that winds by the sound, separated from cars the whole way. It is scenic, relaxing and safe.

We should be able to downsize to one car and use it mostly for longer trips. I can’t wait to cut maintenance, insurance, depreciation and gas expenses in half. Simplicity and efficiency is king. It’s a big change from all the driving we do now due to the lack of biking infrastructure in our car-centric suburbia.

What Are You Gonna Do?

That’s up in the air. We are not “retiring” – we are changing what we do for a living. Maximizing dollars earned per hour will cease to be the main focus when it comes to work. Between the triplex and the rental property and other investments all of our basic expenses will be covered so technically we could retire in a traditional sense. We could just manage these real and paper investments and live “comfortably lean”.

But of course we didn’t get to where we are now by sitting around. I don’t want to “retire” – I want to wake up every morning and look forward to the day. After years in the cubicle I know that’s not it. We paid our dues, we built our nest egg… what’s next?

Well, as of today the plan is to actually continue working the same job for about a year after we move to the Outer Banks. I should be able to telecommute on Fridays and Mondays. I’d drive early Tuesday morning and leave after work on Thursday to come back to the Outer Banks. I’ll stay at my mom’s house Tuesday and Wednesday night. She lives 20 minutes from my work and she’s very excited about this option. Considering I currently see my mom just a couple of hours per week on weekends, I’ll end up spending more time with her while living on the island than I do now. Not only that, but I can shuttle both grandmas back and forth so that our son still gets plenty of grandma time.

During our first year on the Outer Banks I’ll start looking into what I can do for work locally. I don’t need to make as much as I do now. Flexible schedule is key. I’m handy, entrepreneurial, know computers and IT, love real estate and cars… I know there’s something I can do that’ll provide more satisfaction than the cubicle hell I’m in now. I’d love to get into house flipping or property management or something else in real estate. But I’ll drive for Uber or do random handyman-type gigs or bartend at a local watering hole once in a while. When you don’t have to worry about covering basic expenses your options are wide open.

My wife has a few ideas of her own. She is sick and tired of the corporate world. Fourteen years with a multi-billion multi-national mega corp can crush your soul. She’s ready to get out. She can quit today but we decided it makes sense to continue working there until we move next summer. Our health insurance is through her job. She’s also maxing out her 401K and the HSA which definitely helps the bottom line. While my wife waits to submit her resignation letter we registered a web site for one of her business ideas. Again, the focus is not on the money but on doing something she likes.

So There You Have It

A quick rundown on the Why and the Where and the How and the What. A blueprint of the next chapter. In pencil, not ink. Eraser in hand for adjustments as needed.

We sure hope it all works out as we envision.

Worst case: We’ll know that we took a chance, have no regrets and a cool story.

Best case: We’ll say “WHY DID WE WAIT SO LONG?”


2 thoughts on “The Next Chapter

  1. Sounds like the perfect life and can definitely see why you snapped it up!

    I’d either go full AirBnB or full renting, I’m not sure it would be fair to a renter to constantly have to put up with new people next door but I guess if the renter is an easy going type they may not mind.

    “on a trail that winds by the sound, separated from cars the whole way. It is scenic, relaxing and safe.” – Wow… that nails it for me. Sounds ideal!

    I want to move there now, haha!

    Also, I had a quick look at the area on google maps and it looks like a tiny strip of land, crazy to think there are big shops, cinema, etc… on it. Although I guess it’s probably a lot bigger than it looks from essentially space 🙂

    GL with the move!

    • No, you are exactly right – it’s a tiny strip of land. It’s less than a mile from the sound to the ocean and our house is right in the middle. If the sea levels keep rising we’ll end up with a waterfront property at which point we need to cash out and get the hell out of there! That’s our inside joke anyway…

      I hear you on the Airbnb/yearly rental mix. I threw it in there mostly if my mom wants to move in with us if we do end up staying long term. She is getting older and that’s a nice option to have. We could rent out her 3 bedroom townhome which is right next to our rental condo back on mainland. My mom and I snagged the townhome during the housing crisis as a foreclosure. It’s paid off and would bring solid income that we could split. If my mom moved in, she wouldn’t mind the renters. She could help manage the second apartment or the entire place if we are travelling. I really like the flexibility that this triplex provides!

      Thanks for your well wishes! I’ll keep this blog updated as this adventure unfolds.

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