a classic example here is the "extra bedroom for Grandma" - visits from Grandma are easy to imagine, but if she only comes a couple of days a year, spending tens of thousands more dollars for a house with an extra bedroom and bathroom for her is probably pretty stupid. You'd save money - and make her happier - by putting her up in the local five star hotel.

I'm going to buy a house with a room for "grandma", and here's why: While it might cost me less to put guests in luxury hotels, it's going to cost me every time I have a guest over. I might be unusual here, but I know that both the cost and the slightly more difficult choice ("Should I save the money by not inviting them to stay?") is going to make me unhappy every time I get a guest.

From a purely economical view point this line of thinking might be irrational, but I've found that the action or prospect of paying has a real cost in happiness, so I prefer to do pay more once than less split over many instances.