Is anyone under 35 without a rich mommy and daddy be able to buy a good house?

[Anonymous]

Hey OP, started to read your post and thought you were going to be like an earlier poster on another thread who just felt sooo sorry for herself and resented her older baby boom siblings. But you put this in context and the reality is that the situation you're in sucks and of course you should be upset. My heart goes out to you. I hope things get better.

[Anonymous]

Anonymous wrote: My advice is buy now when interest rates are low. Don't make the mistake of focusing only on purchase price. If you scrimp for 7 more years but rates are much higher the extra money you saved could make zero difference.

Also, buy smaller and older than you aspire to, but in a good school district, in Arlington. Property values are unlikely to go down much more here, and if you can live in it for about 5 or so years, you will be able to sell at a profit and move up to a nicer place. Not so if you live further out or in a marginal school district.

This is good advice. Interest rates have gone up in the past few weeks and it makes quite a difference in the monthly mortgage payments.

[Anonymous]

Anonymous wrote:

Anonymous wrote:HHI of $50k in 2000, rising up to $175k today.

What do you do now to make the salary leap?

Stayed in IT for 10 years. My wife has started to work since then and has gotten 7-10% raises a couple times; she makes nearly as much as I do.

[Anonymous]

10 years ago, I couldn't imagine living in the house I'm in now. Awesome job saving you downpayment...what an incredible feat...$100K. I know you may love the city, but if you want bang for the buck, head out to the Dulles Greenway and take advantage of all the shortsales going on in Loudoun County.

We bought in a beautiful neighborhood that I never would have been able to afford new....we got the house for $500K less than the original builder price. Short sales are awesome...you are in a unique situation to buy without any contingencies.

Hold your hope...chin up...your time is coming. With the money you've saved, you'll get in somewhere and you'll be very happy.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP, I don't think buying a house has been the hurdle for under 35. We have all seen people buying houses without a down payment or even jobs. I think it is clear that anyone can buy houses. The more interesting question is: anyone under 50 without rich daddy/mommy paid off the mortgage to their house?

But why would you want to? There is pretty much no benefit to paying off a mortgage before you retire. Many of us want a mortgage for the interest rate deduction, which substantially helps offset my tax liability. I would much rather have significant savings - IRAs, 529s, cash, stocks, etc. - than waste my savings on paying off a mortgage. Almost every good financial advisor will tell you the same thing.

Owning your home free and clear at 35 is a total waste of your savings unless you don't bring in any income (or a very small amount).

Without mortgage: I keep $20k of income and spend an extra $8k on taxes. Net $12k.
With mortgage: I spend $20k of income on interest and save $8k on taxes. Net $12k.

Only if the mortgage interest deduction put you under the line for a lower bracket would you actuall save money.

Plus, there is the warm fuzzy feeling of having no debt. Agreed with you, however, on the foolishness of being house-rich/cash-poor at 50. But -- paying down the mortgage as part of a balanced savings strategery (e.g. 10% to 401k/retirement, 5% to rainy day fund, 2.5% to stock trading account, 2.5% to paying down the mortgage) is not a bad idea by any stretch, IMO.

Wow really? This is the most ridiculous calculation justifying not paying off debt (mortgage, credit cards, etc). There are so many variables that you are not taking into account. The most important variable being that you will never be unemployed. Unless you have a rich mommy or daddy, can you guaranteed that you will maintain your level of income, let alone that you will always have a job? This is a FUZZY MATH indeed! Please do not spread this false notion. No wonder we're having home foreclosure crisis.

[Anonymous]

OP, I have only read your post and not the subsequent pages and here are my thoughts. I feel for you, certainly, and your sentiments are understandable in so many ways.

For your own sake, you need to get over the bitterness and ill will towards others (those whose parents have helped them, say). I can understand to a great extent because DH and I both come from poor backgrounds, were the first to go to college let alone grad school, and we finished grad school with 250K combined educational debt. No family help for pretty much anything, financially. We both ended up in high salary positions thanks to our own choices and education and we have a nice house. With family help or less educational debt we could be in a huge house. Oh well. You have to question why you feel entitled to a single family home in a good neighborhood with good schools. Not everyone can have that. I understand you feel as though you've done everything right and you can't even get this thing you think is so basic. But it's not so basic--it's a luxury. Really. And there are choices and trade offs, such as moving to an area with a lower COL where you could get the kind of house you think you deserve.

Furthermore, there are many folks out there chained to major debt for having bought homes they really shouldn't have and appearances are not what they seem. Be glad you haven't put yourself in that position and that you're living within your means.

[Anonymous]

$440K, at least now, can buy you a decent house in a decent neighbhorhood in a good school district. We bought our house for $435, live in the Waynewood school district in a fabulous neighborhood, and the Ft. Hunt area is definitely not considered the boonies - it's very convenient, close in and incredibly safe.

I will say this though...we bought a fixer upper and over the course of 1 year, dumped a lot of money into our house. It's not a large house, but it's perfect for us and if we need to, we'll add on instead of moving. My hubby is a real estate guru (invester) and is able to find sweet deals. He paid $45K for our house in Old Town and it's now worth over $500K (2 apt. rental). You need to do more research.

[Anonymous]

I did, bought at 34, but I was in Big Law and saved a ton of my salary.

[Anonymous]

Yup! No family money here. DH was 48, I was 46 when we paid off our mortgage Of course, we have one old computer, one iPod and very few "gadgets."

Anonymous wrote:OP, I don't think buying a house has been the hurdle for under 35. We have all seen people buying houses without a down payment or even jobs. I think it is clear that anyone can buy houses. The more interesting question is: anyone under 50 without rich daddy/mommy paid off the mortgage to their house?

[Anonymous]

I made $200K on the sale of my condo in DC that I bought as a single gal making $55K a year in 1999 -- that was our down payment. Hats off to me since my DH was always a renter. We were able to buy in a very good Arlington neighborhood. Don't know how we would've done it otherwise.

[Anonymous]

Once you get down to the last few years, you don't get much of a mortgage deduction,so we paid off our 15 year mortgage in 8.5 years. And we have plenty of money set aside for retirement and in 529 plans. Then again, we had a healthy mortgage when we were 35.

Anonymous wrote:

Anonymous wrote:OP, I don't think buying a house has been the hurdle for under 35. We have all seen people buying houses without a down payment or even jobs. I think it is clear that anyone can buy houses. The more interesting question is: anyone under 50 without rich daddy/mommy paid off the mortgage to their house?

But why would you want to? There is pretty much no benefit to paying off a mortgage before you retire. Many of us want a mortgage for the interest rate deduction, which substantially helps offset my tax liability. I would much rather have significant savings - IRAs, 529s, cash, stocks, etc. - than waste my savings on paying off a mortgage. Almost every good financial advisor will tell you the same thing.

Owning your home free and clear at 35 is a total waste of your savings unless you don't bring in any income (or a very small amount).

[Anonymous]

Anonymous wrote:

Anonymous wrote:We will soon be purchasing a home with the help of soon-to-be DH's rich mommy and daddy. DH and I are both in public service and have saved some for a down payment, but it is a slow, crawling process. I do not feel bad about accepting help from the IL's. DH and I both work very hard and are fiscally responsible. I have never ever had family help me with anything in my life, and it feels nice to be so welcomed into his family (and I don't mean just fiscally).

Just be prepared for some degree of jealousy from less fortunate friends, or to have IL's that think they own you guys.

Our friends would have no idea how we bought the house, it is nothing fancy at all. As for the ILs, they could surprise us of course, but they just are not like that. They are some of the most kind-hearted people I have ever known, and I am so grateful to have them in our lives.

[Anonymous]

We bought our first house 2 years ago in Alexandria for 500K - we were both 28. No help from parents, saved like crazy during grad school, made a VERY small downpayment (3.5% and seller paid closing costs). It's in a great school district...until middle school. Not sure what we will do then. Anyway, it's actually a pretty great place, though frustratingly small at times.

You either decide to keep saving and get your "dream home" or you buy what you can afford, where you can afford it. It's a pretty simple proposition. Sorry you are frustrated.

[Anonymous]

we bought a 1 million dollar house at ages 31/34 on a single 180K income. Prior to moving to DC (and buying this house) we lived in Baltimore and lived like absolute paupers for 5 years. Commuted to DC for work so made "DC" level salaries. Saved roughly 450K for a down payment (combined salary during those years was about 225K.). Now income is about 225K (one income) and mortgage is about 480K so we're living comfortably.
I know this isn't something that you can replicate easily and I don't know what we would do if we moved to this area and attempted to save for a down payment while also paying the high cost of living here.
However, I wanted to share that we have the house we do (nothing fancy but close in) because of years of saving and years of taking the MARC train to work in DC while living remotely in a MUCH cheaper area.

[Anonymous]

Ugh. So many people with "how do you make so much money?" nosiness. Look, I robbed a f*kin bank, okay. They are the same people who think their first house should be $2m. Are they f*king serious? What world are they living in? Delusional much? How about stop worrying about other peoples money so much.

OP, ignore the noise and keep saving. It can be done. You will be better for it having done it on your own. Signed, been there done that, its a long road but well worth it.