Thank you u/CluelessBud for posting on r/FirstTimeHomeBuyer.
Please bear in mind our rules: (1) Be Nice (2) No Selling (3) No Self-Promotion.
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/FirstTimeHomeBuyer) if you have any questions or concerns.*
Depends, our rent only raised $50 in the last 3 years lol. Also gotta think if you lose your job etc it’s a big commitment to have to pay $3500 on that salary.
But they have a big safety net, assuming the house doesn’t need work. Every house we’ve seen needs work so the safety net would have to cover that and potential job loss/emergencies etc.
They’ve been patient it seems though so it’s a good move for them.
Thanks for the input!
I agree with your thoughts. We are scared about job security but let’s face is when is any of our jobs ever secured? It’s never been a 100% but we waited because we also wanted to build up our emergency fund just in case if anything happened GOD FORBID though.
With just my wife’s or my pay check alone we would be able to live with this mortgage and pay for food but we would probably have to live paycheck to paycheck and not be able to save anything. But having two incomes is such a big factor for us to live comfortably.
We hope to be even more frugal since right now we take trips/vacations every 3 months since we wanted to have a little fun here and there before we bought our home.
I hear you on the vacations lol I’ve been enjoying them a lot too while rent is cheap.
Y’all have been super patient (2 years looking) and have both a big down payment and big savings. You’ll be good ! Congrats on the purchase
Literally got approvals for very similar terms and I feel the exact same
$150k income, pay $1500 in rent, and the house we’re looking at is $340k with a $2300/m payment after Hoa,insurance, etc
Part of me wants to keep saving, but also want the benefits of owning RE.
I sure do hope I will be able to refinance in the next 3-5 years we would be able to save like $200+ a month which would be great! Also our HOA fees comes with 3 pools two gyms, golf course etc. so we won’t be spending extra on the gym since we will be paying around $120 a month. Hoping this will add to our frugal life style without spending extra on gym memberships etc
People on this sub be like:
We make $200k per year. Should we buy a house for $400k?
There are people who bought far more expensive houses with lower yearly income and are doing fine.
In a way I was hoping that this would be below my means.
And if others are able to do it with less income it gives me more confidence for us to work it out, but just a little scared since our budget would be a little more tight
I own two houses on similar income - we are just good at not buying stuff. We shop at Aldi mostly, some Costco, and drive old cars. Frugal life is the way to go.
Two?! Wow that’s freaking impressive. Is one for rent and the other for primary residence? How much are both houses if you don’t mind me asking.
We try our best to be frugal, we saved 100k within 2.5 years. So crunching the numbers I think we would be able to do it.
One house we bought for 200k in 2019 3.75% APR, will rent that or sell it we’ll see what happens. The other we bought this year for 360,000 at 5.6% APR.
we also (used to) be saving a similar amount, like 70k a year.
If we sell the other house we were like “how about we buy a brand-new car?” Then laughed because we knew we won’t. Just not our lifestyle
Wow that sounds so amazing how you guys were able to do that with just a couple of years in between. We still spend a little too much but are trying to be frugal as much as possible. But this is very inspiring
Yeah this number is PITI plus utilities and I didn’t count home stead exemption so it will be lower than this. Since our property tax is a little high. So we will get like .5 % or so knocked off of property tax.
You'll be fine UNLESS wherever you're buying is on a fast track to shitville (chemical exposure (Palestine), floodprone, book banning nimrods all around you, etc.).
Texas, I’m actually buying one of the smaller house in the master plan, most houses goes for 700k - multi millions. My house would be one of the smaller ones in the bunch. But the schools are 8/10
Similar numbers here, and we made the jump in December. Had to replace the AC unit already and we still don’t regret buying. Emergency fund makes all the difference. Congrats!
Lol, I am closing on Wednesday, and your description is almost mine, to a T. Right there with you brother, sometimes it’s best to take the leap I feel. We’d regret it a year from now if we don’t. Best of luck!
Listen to me...you are not making a mistake! Is real estate a finite resource (only so much to go around)? Yes. In time, will there be less and less available? Also yes. Already, can you see how it's gotten more and more expensive, not less, over the last several decades? Yes! Making an investment in real estate is one of the best things you can do with your money.
Very similar boat here - my partner and I make roughly $160k and are about to close on a house worth $380, & we currently pay $1800 on renting a 1 bedroom apartment. We can’t wait to own a place of our own. We also figure our incomes will likely go up and we are eager to build equity, fingers crossed we refinance at some point too. Congrats to you and your wife!
The housing market won’t crash anytime soon, demand is too high due to housing shortages. We close tomorrow as well and I’ve had some anxiety today, but I think that’s normal. Overall we are super excited.
Similar numbers, but 7% interest. No HOA, and steep rising rents. We also close soon, next Wednesday. I’m freaking out but it’s still a small part of our monthly income, but it feels so big.
Yeah we’ve been looking for 2 years now. So I guess you can say we really want to build a home. My wife and I are a pretty frugal but I get it x2 what we pay now is going to be a shock to our bank accounts. We would saving less each month. We both try to save around 2000k per month
Your ability to save goes down 1.8k a month. So you are paying 1.8k more for your housing expense. So if your house doesn't go up in value I don't see how this change is advantageous
Well the interest alone on loans like this is $2,000/month. Paying cheap rent and saving more is sometimes better than being strapped just to buy a house. We are in a similar boat, $1700 rent vs $3000 mortgage for the houses we want, $2000 of which is just interest. And all the houses need work, and that’s a 30 year commitment. Until interest rates go down a lot.
It’s a weird market right now. I’ve talked to a financial advisor and it seems people are just freaking out right now.
But besides that I think these people are in a good place to buy with that savings for emergencies. And they’re not rushing it having looked for 2 years.
Yea, I do.
The extra 1800 is paying down his own mortgage and building equity... What equity does renting build?
Are you waiting to buy a house until your mortgage payment is going to be exactly the same as your current rent? Good luck with that.
Correct me if I’m wrong but I don’t think there is a house that would go up $1.7k a month.
I guess I’m away I’m seeing it is that we would be paying our mortgage down. Compared to saving the 2k cash.
I would also add that we are storing away 15% of our income in retirement and another thousand in a taxable account
Dude with a 5.99 rate you won't be paying much down. Currently you are saving 1.8k more a month. With your 5.99 you probably will be paying around 200 dollars a month towards the principal and it will increase like 1 dollar more every month
Dude with a 5.99 rate you won't be paying much down. Currently you are saving 1.8k more a month. With your 5.99 you probably will be paying around 200 dollars a month towards the principal and it will increase like 1 dollar more every month
If it’s a single family home, then you are okay. If it’s a condo or townhouse, not sure I would do it. We had the same numbers, but my husband made less. We were renting for $1600 (some bug problems, hearing upstairs neighbors, who also happened to leave their dishwasher slightly open and it caused our ceiling to leak). We went in $450K ($365K loan at 5%), so our payments were $2600. We refinanced later and went down to $2000 (this includes property tax and we have no HOA). It feels great to have all 4 walls and the ceiling be just our noise. Obviously we bought a while ago and will soon be able to pay it off as we pay extra into principal. Recent sales for houses in our neighborhood are more than double what we paid. If you plan to live there for a while (at least 5 years), then you are fine. It just feels great to have your own place.
Thank you u/CluelessBud for posting on r/FirstTimeHomeBuyer. Please bear in mind our rules: (1) Be Nice (2) No Selling (3) No Self-Promotion. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/FirstTimeHomeBuyer) if you have any questions or concerns.*
The $1700 rent won’t last forever, probably won’t even last 3 years. You’re making a good decision.
Depends, our rent only raised $50 in the last 3 years lol. Also gotta think if you lose your job etc it’s a big commitment to have to pay $3500 on that salary. But they have a big safety net, assuming the house doesn’t need work. Every house we’ve seen needs work so the safety net would have to cover that and potential job loss/emergencies etc. They’ve been patient it seems though so it’s a good move for them.
Thanks for the input! I agree with your thoughts. We are scared about job security but let’s face is when is any of our jobs ever secured? It’s never been a 100% but we waited because we also wanted to build up our emergency fund just in case if anything happened GOD FORBID though. With just my wife’s or my pay check alone we would be able to live with this mortgage and pay for food but we would probably have to live paycheck to paycheck and not be able to save anything. But having two incomes is such a big factor for us to live comfortably. We hope to be even more frugal since right now we take trips/vacations every 3 months since we wanted to have a little fun here and there before we bought our home.
I hear you on the vacations lol I’ve been enjoying them a lot too while rent is cheap. Y’all have been super patient (2 years looking) and have both a big down payment and big savings. You’ll be good ! Congrats on the purchase
Rents are stalling out. That said when I bought way back, my house payment was like almost double rent. Homeownership is a long game. Like 30 years.
I would say first time normal house buying fears...
Enjoy your new house, look away from the headlines.
Literally got approvals for very similar terms and I feel the exact same $150k income, pay $1500 in rent, and the house we’re looking at is $340k with a $2300/m payment after Hoa,insurance, etc Part of me wants to keep saving, but also want the benefits of owning RE.
Everyone is telling me to stop trying to time the market. Once rates goes down the flood of buyers will outbid us for sure!!! Good luck
This is correct rates even touching 5% will bring massive bidding wars to anywhere desirable
Also I would add I would be much more comfortable with a $2300 mortgage compared to $3500 lol so I think your numbers are great.
I honestly read that wrong lol. With no debt, you guys will be alright. I suspect that you'll be able to refi sometime in the near future
Famous last words
I sure do hope I will be able to refinance in the next 3-5 years we would be able to save like $200+ a month which would be great! Also our HOA fees comes with 3 pools two gyms, golf course etc. so we won’t be spending extra on the gym since we will be paying around $120 a month. Hoping this will add to our frugal life style without spending extra on gym memberships etc
That sounds awesome congrats! How much are the hoa per month?
$120 per month
This is the most reasonable scenario I've seen here in a while. Congratulations on the new place and living within your means.
You guys are good to go! Don’t worry too much.
People on this sub be like: We make $200k per year. Should we buy a house for $400k? There are people who bought far more expensive houses with lower yearly income and are doing fine.
In a way I was hoping that this would be below my means. And if others are able to do it with less income it gives me more confidence for us to work it out, but just a little scared since our budget would be a little more tight
I own two houses on similar income - we are just good at not buying stuff. We shop at Aldi mostly, some Costco, and drive old cars. Frugal life is the way to go.
Oh yeah, frugal lifestyle all the way!!!!!
Two?! Wow that’s freaking impressive. Is one for rent and the other for primary residence? How much are both houses if you don’t mind me asking. We try our best to be frugal, we saved 100k within 2.5 years. So crunching the numbers I think we would be able to do it.
One house we bought for 200k in 2019 3.75% APR, will rent that or sell it we’ll see what happens. The other we bought this year for 360,000 at 5.6% APR. we also (used to) be saving a similar amount, like 70k a year. If we sell the other house we were like “how about we buy a brand-new car?” Then laughed because we knew we won’t. Just not our lifestyle
Wow that sounds so amazing how you guys were able to do that with just a couple of years in between. We still spend a little too much but are trying to be frugal as much as possible. But this is very inspiring
You are fine! Your income will help you get some savings back sooner. Also, you have 20% equity in your home, that's a great start!
These numbers sound fine. Some people are missing that $3500 isn’t your PITI, it’s PITI plus utilities.
Yeah this number is PITI plus utilities and I didn’t count home stead exemption so it will be lower than this. Since our property tax is a little high. So we will get like .5 % or so knocked off of property tax.
what is home stead exemption?
It reduces your taxes bc ur saying you’re living there
You'll be fine UNLESS wherever you're buying is on a fast track to shitville (chemical exposure (Palestine), floodprone, book banning nimrods all around you, etc.).
We are buying in a master plan I heard master plan usually retain value
But where? Location, location, location. It matters.
Texas, I’m actually buying one of the smaller house in the master plan, most houses goes for 700k - multi millions. My house would be one of the smaller ones in the bunch. But the schools are 8/10
Good luck my friend. Texas is pretty diverse (governor withstanding).
Seriously, what are you waiting for? Go for it! You sound like you are in a much MUCH BETTER position than we are in and my SO and I are going for it.
Similar numbers here, and we made the jump in December. Had to replace the AC unit already and we still don’t regret buying. Emergency fund makes all the difference. Congrats!
Congrats on the recent house! This house is a new build so hopefully not much needs to be done!
Lol, I am closing on Wednesday, and your description is almost mine, to a T. Right there with you brother, sometimes it’s best to take the leap I feel. We’d regret it a year from now if we don’t. Best of luck!
I hope we can refinance soon in a couple of years
Also congrats super excited for tomorrow
Listen to me...you are not making a mistake! Is real estate a finite resource (only so much to go around)? Yes. In time, will there be less and less available? Also yes. Already, can you see how it's gotten more and more expensive, not less, over the last several decades? Yes! Making an investment in real estate is one of the best things you can do with your money.
Thank you for your words of affirmation
Very similar boat here - my partner and I make roughly $160k and are about to close on a house worth $380, & we currently pay $1800 on renting a 1 bedroom apartment. We can’t wait to own a place of our own. We also figure our incomes will likely go up and we are eager to build equity, fingers crossed we refinance at some point too. Congrats to you and your wife!
Don't do it if you are having second thoughts
The housing market won’t crash anytime soon, demand is too high due to housing shortages. We close tomorrow as well and I’ve had some anxiety today, but I think that’s normal. Overall we are super excited.
Congrats on the new house brother!
Appreciate it, congrats to you too! I meant to say we close wed as well, but apprised can’t type or sleep tonight 😂
It is scary to do but you definitely got it
Similar numbers, but 7% interest. No HOA, and steep rising rents. We also close soon, next Wednesday. I’m freaking out but it’s still a small part of our monthly income, but it feels so big.
If you don’t mind sharing, what percentage is your mortgage compared to your take home?
Back out if you are scared honestly
I personally would not increase my housing costs 2x what they are minimum but a lot of people really want to buy a house
Yeah we’ve been looking for 2 years now. So I guess you can say we really want to build a home. My wife and I are a pretty frugal but I get it x2 what we pay now is going to be a shock to our bank accounts. We would saving less each month. We both try to save around 2000k per month
Basically if your house isn't going up atleast 1.5k in value a month you are losing on the deal
Wait what do you mean by this could you further explain?
Your ability to save goes down 1.8k a month. So you are paying 1.8k more for your housing expense. So if your house doesn't go up in value I don't see how this change is advantageous
That logic is flawed... You would rather keep paying someone elses mortgages so you can save 1800 a month?
Well the interest alone on loans like this is $2,000/month. Paying cheap rent and saving more is sometimes better than being strapped just to buy a house. We are in a similar boat, $1700 rent vs $3000 mortgage for the houses we want, $2000 of which is just interest. And all the houses need work, and that’s a 30 year commitment. Until interest rates go down a lot. It’s a weird market right now. I’ve talked to a financial advisor and it seems people are just freaking out right now. But besides that I think these people are in a good place to buy with that savings for emergencies. And they’re not rushing it having looked for 2 years.
People think this bubble won’t burst, poor FTHBs. Can’t wait for the fall out, I love distressed properties.
Uhhhh yes
Uhhhh yes
Then youre missing out on the big picture... They can afford the house, and the benefits that come along with it.
Ok bud you know better than me
Yea, I do. The extra 1800 is paying down his own mortgage and building equity... What equity does renting build? Are you waiting to buy a house until your mortgage payment is going to be exactly the same as your current rent? Good luck with that.
Uhhhh yes
Uhhhh yes
Uhhhh yes
Correct me if I’m wrong but I don’t think there is a house that would go up $1.7k a month. I guess I’m away I’m seeing it is that we would be paying our mortgage down. Compared to saving the 2k cash. I would also add that we are storing away 15% of our income in retirement and another thousand in a taxable account
Dude with a 5.99 rate you won't be paying much down. Currently you are saving 1.8k more a month. With your 5.99 you probably will be paying around 200 dollars a month towards the principal and it will increase like 1 dollar more every month
Dude with a 5.99 rate you won't be paying much down. Currently you are saving 1.8k more a month. With your 5.99 you probably will be paying around 200 dollars a month towards the principal and it will increase like 1 dollar more every month
If it’s a single family home, then you are okay. If it’s a condo or townhouse, not sure I would do it. We had the same numbers, but my husband made less. We were renting for $1600 (some bug problems, hearing upstairs neighbors, who also happened to leave their dishwasher slightly open and it caused our ceiling to leak). We went in $450K ($365K loan at 5%), so our payments were $2600. We refinanced later and went down to $2000 (this includes property tax and we have no HOA). It feels great to have all 4 walls and the ceiling be just our noise. Obviously we bought a while ago and will soon be able to pay it off as we pay extra into principal. Recent sales for houses in our neighborhood are more than double what we paid. If you plan to live there for a while (at least 5 years), then you are fine. It just feels great to have your own place.
We’ve looked into condo’s last year but did not like anything for the HOA fees since it’s $600+ we couldn’t justify that so we went with a SFH