At what HHI would you consider a 1.5mm mortgage

[Anonymous]

Anonymous wrote:Wow you all live large. We have $1m income and have about $300k mortgage left on a $1.3m townhouse. Of course we could afford a lot more, but I don’t want that kind of risk.

Np here. I moved from DC to the Bay Area. Sadly for us a 1200 sq foot 3 bedroom is $2 million or more (or it needs major work like a new foundation). We rent, but there are many places where you could spend a LOT and still not necessarily be “living large.” Prices are better in DC area, but plenty of expensive housing there too.

[Anonymous]

Anonymous wrote:Wow you all live large. We have $1m income and have about $300k mortgage left on a $1.3m townhouse. Of course we could afford a lot more, but I don’t want that kind of risk.

How is going above a $1.3 million house risky on a $1 million income? I don’t make anywhere near that, but it would be the equivalent of me saying, “Gee, spending more than $325K on a house might be risky on my $250K income.”

[Anonymous]

I’d need to have $750k in HHI to feel comfortable with that. And it would depend on other expenses. If we were also doing private school for 2 kids, sleepaway camp, and expensive sports, I’d need more.

[Anonymous]

$1M. We just bought a 3.5 M house, mortgage will be about 1.5M, and we make $1.5M. Feel totally comfortable with it.

[Anonymous]

Anonymous wrote:Never.

what a stupid answer

for some people a 1.5mm mortgage is peanuts

[Anonymous]

Anonymous wrote:

Anonymous wrote:Never.

what a stupid answer

for some people a 1.5mm mortgage is peanuts

Not the person who wrote "never" but I +1 that sentiment. It's not a stupid answer to me. I feel like people who can afford a house that expensive shouldn't have to take on a jumbo mortgage. It just screams overextended to me.

We have $1M HHI. Our home is paid off but the most we ever owed was around $300k.

[Anonymous]

Most people who are buying $2M homes right now have that mortgage. Most of them I know probably make $500k. Source: propertyIQ. It’s totally irresponsible IMO and what’s driving up property values but it’s their life.

[Anonymous]

You cannot answer these questions in a vacuum. In a vacuum, the maximum reasonable DTI is 40%, so a 1.5m mortgage would require a minimum HHI of 280k.

The issue with the vacuum, is that with an HHI of 280k, the 1.3m for a down payment probably came from family money. There is a big difference between a 1.5m mortgage on 280k when you are being gifted 140k a year and the grandparents have taken care of the college funds and 280k with no family help.

[Anonymous]

The above is the real answer.

[Anonymous]

Anonymous wrote:

Anonymous wrote:HHI ~$1m and I now regret our $1.3m mortgage @5.75%. I wish we bought a cheaper house…

Why? That should be comfortable at your income level.

Mostly it’s the privite school tuition and the au pair. On top of that, there’s travel, and of course savings because we won’t be making $1m forever. In hindsight, I wish we bought a cheaper house and saved more aggressively.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Never.

what a stupid answer

for some people a 1.5mm mortgage is peanuts

Not the person who wrote "never" but I +1 that sentiment. It's not a stupid answer to me. I feel like people who can afford a house that expensive shouldn't have to take on a jumbo mortgage. It just screams overextended to me.

We have $1M HHI. Our home is paid off but the most we ever owed was around $300k.

This always comes down to math. In the environment now, sure put more down, but why in a million years would I not lever up at the rates we have 2.75%. The payment is less than 7% of my income.

[Anonymous]

$500k

[Anonymous]

Never, ever, ever. But I'm not someone who values a large home, nor would I ever want to live in say NYC or similar where this is common. It doesn't fit with my value set. I'm more of a "live in a small, modest house, family of 4 with 1 car, shop at Aldi person". Always will be even though financially I don't need to. I think that much money on a house is foolish.