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Message
re: How much house can I afford?
Posted on 1/24/23 at 4:46 pm to tigerfootball123
Posted on 1/24/23 at 4:46 pm to tigerfootball123
quote:
What all would you subtract from monthly salary to consider it “take home” pay?
You really need to determine this based on your essential expenses.
Maxing out 401k? Almost $2k a month
IRA? Around $500/month
Student loans?
Car note?
Utilities? Insurance?
School for kids?
Day care?
Groceries? Eating out? Entertainment?
You need to realistically know what you spend
0
Posted on 1/24/23 at 5:12 pm to CorkRockingham
quote:
50-60% of your gross pay is a good place to start. It will be conservative but after insurance, taxes, 401k, Roth if you still qualify, it will be about right.
I think people are misunderstanding your post. 50-60% or your gross is a reasonable place to start the “take home calculation,” but people think you’re answering the original post question.
Posted on 1/24/23 at 5:54 pm to tigerbacon
quote:
If you make 150K a year combined household income you should buy a house less than 300k
Problem is in a lot of cities that would put you in a sketchy neighborhood with crummy schools.
Posted on 1/24/23 at 6:06 pm to tigerfootball123
Income - savings = expenses
Target 10-20% to savings (ie, investments, etc)
Spend expenses on whatever you want, house included
Your future self will appreciate this present mindset
Good luck!
Target 10-20% to savings (ie, investments, etc)
Spend expenses on whatever you want, house included
Your future self will appreciate this present mindset
Good luck!
Posted on 1/24/23 at 6:35 pm to GeauxTigers123
quote:
Problem is in a lot of cities that would put you in a sketchy neighborhood with crummy schools.
I bought a house in a freaking great neighborhood, bunch of wooded lots, deer and wildlife roaming around my backyard.... but one of the shittiest schools in the area.
God it was a nightmare to sell. Buy a starter home in the best elementary school district you can find.
Posted on 1/24/23 at 7:31 pm to j1897
quote:
God it was a nightmare to sell. Buy a starter home in the best elementary school district you can find.
This is what my wife and I did
We’ll be start the building process in the next year and the house value keeps going up
Posted on 1/24/23 at 7:37 pm to tigerfootball123
Posted on 1/24/23 at 8:03 pm to tigerfootball123
Get an apt for a few years until you are a partner in the group and have a better idea of your annual income..then buy a house
Posted on 1/24/23 at 8:48 pm to tigerbacon
quote:
I know 300k house seems low for 150K but I believe in not being house poor.
Can you define house poor?
I know it's not cut and dry like that, but genuinely interested in what you would say is house poor.
Posted on 1/24/23 at 8:51 pm to VermilionTiger
quote:
This is what my wife and I did
We’ll be start the building process in the next year and the house value keeps going up
Ya'll will be good. Probably very good. I should have connected the dots that normal people wanting a 4bd house don't want and office and a theater room, they want a school for the kids in those bedrooms. But no, i did not connect those.
Posted on 1/24/23 at 9:12 pm to tigerfootball123
What’s your income?
How much savings do you have?
How much savings do you have?
Posted on 1/24/23 at 9:45 pm to Grinder
House poor is you have to change your life style because of the mortgage.
Posted on 1/24/23 at 10:40 pm to tigerbacon
Don’t forget to calculate your property tax, homeowners insurance, and flood insurance. This adds up to a significant amount I pay yearly that I was aware of, but kinda overlooked before I finalized my mortgage.
Posted on 1/25/23 at 7:12 am to tigerbacon
quote:
House poor is you have to change your life style because of the mortgage.
That's fair, but if someone has a 150k income and can't afford a > 300k house without changing their lifestyle, they have other spending issues that should be addressed.
Posted on 1/25/23 at 7:12 am to saderade
I'll throw in the opposite of being house poor, don't buymuch under your means and then resent buying that house. Our mortgage is about 12% of our take home pay and that is on a 20 year loan. We saved a lot of money, but I've never loved our house and we've been here 8 years. Being that house is a little older (1960's) there is more upkeep and fix ups than a newer house and that costs a little more as well.
We were going to build in 2015 and then changed our minds at the last second and ended up buying this house. We felt a little stretched on the new build and decided we didn't want to be that close to overextended, even though we could've afforded it. My wife said if buying this house was a mistake, it was one we could sell.
We've been able to dump way more into retirement accounts, kids 529s, and not bat an eye on taking a nice yearly vacation because of our lower house payment. But like I said, I don't love our house, so it all comes with trade offs.
We were going to build in 2015 and then changed our minds at the last second and ended up buying this house. We felt a little stretched on the new build and decided we didn't want to be that close to overextended, even though we could've afforded it. My wife said if buying this house was a mistake, it was one we could sell.
We've been able to dump way more into retirement accounts, kids 529s, and not bat an eye on taking a nice yearly vacation because of our lower house payment. But like I said, I don't love our house, so it all comes with trade offs.
This post was edited on 1/25/23 at 11:33 am
Posted on 1/25/23 at 8:18 am to j1897
quote:
Ya'll will be good. Probably very good. I should have connected the dots that normal people wanting a 4bd house don't want and office and a theater room, they want a school for the kids in those bedrooms. But no, i did not connect those.
I just bought a house in northern NJ (Bergen Co) and the incredible public schools was almost the entire reason why
If there has been any change in the housing market it does not reflect in that area A good school system is probably the single most important factor in determining a homes value over time.
Posted on 1/25/23 at 8:33 am to thegreatboudini
quote:
Can you define house poor?
I know it's not cut and dry like that, but genuinely interested in what you would say is house poor.
House poor is when your mortgage/property taxes/utilities/insurance cost you so much that you can't spend as much money on entertainment, travel, cars, toys, etc. as you would like or in extreme situations you can't spend as much money on items you "need" like food and clothes.
Posted on 1/25/23 at 8:43 am to notsince98
We’re at 11% of take home.
Honestly bumping it up for a larger payment would force my wife to spend less instead of buying Chinese crap on Amazon daily
Honestly bumping it up for a larger payment would force my wife to spend less instead of buying Chinese crap on Amazon daily
Posted on 1/25/23 at 11:35 am to wileyjones
About 30 years ago, my mom worked with this woman who bought a house and put no furniture in it for over 5 years. She and her husband wanted this particular house badly and overspent for it and couldn't afford furniture. They had a bed and that was about it. They ate at the counter, didn't even have a dining room table. I asked my mom recently about her, and she said they still live in that house and it is fully furnished.
Posted on 1/25/23 at 1:28 pm to grsharky
quote:
About 30 years ago, my mom worked with this woman who bought a house and put no furniture in it for over 5 years. She and her husband wanted this particular house badly and overspent for it and couldn't afford furniture. They had a bed and that was about it. They ate at the counter, didn't even have a dining room table. I asked my mom recently about her, and she said they still live in that house and it is fully furnished.
Did the woman complain about living like that? If not, that deserves some respect for knowing what you want and doing what it required to get it assuming they didn't rack up huge amounts of debt just buying food and paying utilities.
My parents built a house and we lived in the unfinished basement for over a year (family of 5) because the upstairs was only open-stud walls (nothing finished). Then when we finished the upstairs except the kitchen and dining remained unfinished for about 5 years. All there was, was a sink with laminate countertop sitting up on 2x4 posts, a range and a microwave. There was only subfloor for kitchen/dining room. Then mom finally got kitchen cabinets and remained without flooring for a few more years. I think it was finally around 15 year mark that mom finally put in flooring for the kitchen and dining room.
This post was edited on 1/25/23 at 1:29 pm
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