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But its not smart IF inflation rises considerably (15% 30 years ago) making home loans unaffordable, forcing down housing prices again. Then if you are sitting on a $500,000 at 4% and can't sell for $200,000 at 8+% - that's your debt to shoulder. |
Evidently not. |
PP where do you live? Your neighborhood sounds ideal. |
Hello Dorothy; you're not in Kansas anymore. Lots of high earners in this town. |
"my husband and I both work, make a combines gross income of $185K and can not afford an $800-1mil home
have 1 child." Because you don't have 20%? I just refinanced an almost 900K house on a 175K salary. And yes, we save for college and retirement. |
I made the humanities PhD comment but none of the posts there after. I think that people who have high paying jobs, flexibility, nice homes, and time with their kids have it made. I hope for my kids to have the same and wouldn't begrudge someone a great situation. It's good to find out more about just how people have done that on this thread. |
We were able to do it (two high GS salaries, but I'm only PT) partially because we stretched in 2000 to buy our first house which doubled in value (we weren't high GSers then). And partially because we don't spend money on the one thing we've noticed a lot of people here spend a ton on -- our cars.
We are driving two six-year-old cars we purchased used and with cash. Every other car around here is a decked-out high-end luxury something-or-other. For us a car is simply a utilitarian purchase (note NOT an investment as it will NEVER appreciate). We chose to save our money instead and were able to get a solid down payment (between savings and gains from the other house) and now live in a house worth $1.5M. We also don't go out to eat often, which saves more money than most people think. |
Not all well-paying jobs require a lifestyle sacrifice. My DH makes way (WAY) more than I do and is much more flexible and can be home with the kids a lot more than I can. He's a lobbyist, and he put in his time for years working his ass off on campaigns and in the government, but now he's in his late 30s and has a pretty relaxing lifestyle while still making over 250K. I'm sure he could make more if he was willing to go to more dinners, receptions, etc., but he really values being home with us. He travels some but really not too much. We also got lucky with the Capitol Hill real estate market, traded up a few times and recently paid $900K for our "forever house" in Arlington. |
HHI $400K. We paid $1.8 MM in 2007. Mortgage is $700K. Rest came from stock options from my DH's former employer. We got really lucky. |
How much of that 900k did you refinance? Because unless it was $720k, then you're really not making a fair comparison. Our mortgage is $400k; we make about $250k; I can't imagine nearly doubling my mortgage payment. Of course, on top of retirement and college, we're also paying daycare right now, but still, a 720k mortgage on a 175k salary seems pretty steep. |
Yes, it does. I have a 3.25% ARM, have our mortgage down to $500K and we have a HHI of just over $200K and I can't imagine increasing my mortgage. We do save for retirement and college. Wow...talk about house-poor. |
One thing that helped us was that we didn't live in DC when we first graduated from college. We spent two years in Texas, and lived in the nicest house either of us had ever owned -- and it was under $150,000. We paid off all our student loans and car loans during that two year period. We are lucky to have a high HHI now and a big house -- but we spent many years living beneath our means and saved lots of money. Not everyone in an expensive house had help from Mom and Dad. |
But you're bragging. (It's anon. So you could be lying.) You represent many on this thread who feel the need to praise how they've "made it" and just how flexible and wonderful their schedules are - all while spending major quality time with their kids. I simply can't believe it's true in all honesty. Even to feel the need to brag anonymously is a cover up for insecurity. I have rich friends. My father's friend just cut her a check for over half a million for a condo in VA. She's one of 6 kids, btw. Yet you'd never look at them and realize how wealthy they are. And yes, I suppose it's "new money," as they aren't descendants of the Rothschild family. But they (all 6 kids and the parents) live in modest homes, shop at "regular" stores, and don't talk about money. (I know b/c I'm a close family friend.) So again, this need to brag is brought on by some inadequacy. |
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