<prompt> Human: I am going to be a first time homebuyer. Im torn between getting a nice home with a nicer mortgage or a small home with a small mortgage. My husband and I have a combined income of 120kyear. The house would be for us and my two kids. A smaller home townhouse would end up being around 1,000month mortgage. A larger home would be around 2,000month. 30 year mortgage at an estimated 3.5-4 interest rate. I love the idea of having a comfortable sized home to relax in but Im also in love with the idea of saving money for later. Which is a better option in the long run? Saving an extra 1,000 a month or investing in a larger home? The house market is pretty stable in my area at the moment. But who knows what the future will hold. Edit: thank you all so much for your input and advice! My husband and I have a lot to think about and will definitely be adding some of these into our discussion. FYI- this is why I love reddit :  <response>: Heres an option Ill throw out. Take out a 15-year mortgage and build decent equity in it for the next 5 years and then sell and move into a larger house. Generally you want to stay within 2-3x your annual income. 