Buy the location, not the size

especially for a small family.

Buy the size fit your family needs now and for the next 5 years or beyond.

In the city I live, the smaller houses within the loop appreciated significantly faster than the bigger houses in master planned subs in the last 5-10 years.

Of course, the small (and usually older) houses "in the loop" is not cheaper than larger sub houses.

The trend for returning to "city" is still continuing.

Unless you guys work in the subs.

Other factors to consider: Family planning (plan for kids in the future). Other investment opportunity.