How much house can we afford?

[Anonymous]

We're a family of four who just moved to area 6 mo ago, so still adjusting to finances in DC area. I'm trying to figure out how much house we can afford. We'll have downpayment of about $200k, HHI of $165k, two kids. One website tells me we can afford more than $900k, which seems way high. We don't want to be house poor--want to save for college, retirement (though I'll qualify for a pension so that helps, no pension for hubby), have some money for fun/travel/emergency savings too. On the other hand, seems like you pay a lot to get a not spectacular house in a good, close-in school district here.

More experienced DC-area families--have any ideas what a reasonable budget is, either for monthly mortgage or overall purchase price? Thanks for any ideas!

[Anonymous]

Truthfully, with a HHI income of $165K, I'd stick with around $550. Put down $150 down (assuming you want to be in this house for awhile, right?) and keep your other$50K in savings. I don't know where you all are commuting too but you can buy some nice houses in the $550K range in midrange suburbs that have great schools.

[Anonymous]

This the VA Public Schools forum - you may wish to post this in the Real Estate forum for more traffic.

[Anonymous]

I have always been taught that your mortgage should never be more than 30% of your pretax income

[Anonymous]

OP here--Sorry, meant to post to Real Estate forum. I've been reading both VA public schools and Real Estate and accidentally mis-posted. Moving now...

[Anonymous]

It's hard for us to tell you that without knowing your other expenses, credit, etc.

Try it out...whatever you think/guess you can afford, save the extra on top of your current rent for a few months...you'll get a sense of if it's a reasonable amount and the savings during tha time can pay your move costs.