What can we realistically buy with $250K HHI?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Really depends on how much you are willing to pay (max) on PITI and how much you can put down as well (but if need be, in my view, you could put down a little less of it makes a negligeable monthly difference if it manes you have more emergency funds available). Really base it on that PITI (the monthly payments) rather than the price of the place.

At 250k gross, given 3 kids (and their associated espenses) I would assume 4.5k-5k would be your ambsolute max PITI that you should go for and even then it may be tight. Yeah the current market sucks.

We have a similar HHI and just bought so we will be paying around $5k PITI after 20% down, but we have only 1 child. It would be very tight with 3 kids.

You've got that right. Signed, 3 kids + $5700 mortgage payment

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Depends on your debt and expenses, and your down payment.
A general number is 3x gross salary. But if you have a ton of debt, less than that.
Will your income grow in the next 3 years? If so, I’d do 1M now.

3x gross salary is outdated and not remotely realistic anymore for the non-wealthy.

Oh Please. She’s not getting anything under that. You have no idea if OP is at 250 HHI and stuck there, or 250 mid 30s with a potential climb to 400.

What? I mean that most people realistically spend way more than 3x gross salary because it is necessary unless they want to live in a tiny dumpy condo forever.

OP makes $250K, 3 times that is $750K. There are lots of good options for $750K in this area.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We made 80K when we bought a 650K house. We had scrimped and saved for 10 years, lived in a crappy one-bedroom rental with our two young kids, in order to pay a downpayment sufficient enough to qualify for that mortgage with that income: 40%.

In the years I've been on DCUM, I have often come across posts like yours, OP. Invariably, the authors of the posts have not saved as much as they could have. Most don't have no idea what REAL belt-tightening entails. They've never lived like that.

You made choices. Own them. Home-ownership is not for everyone - like everything that matters in life, you need to be able to prioritize.

This poster got lucky with Apple stock and is acting all high and mighty like they did it all on their own. 😂

They did do it on their own. It doesn’t mean their stock picking is a strategy other people will be able to replicate successfully though.

This! You could have bought Nvidia 3 years ago and been in a good position to buy a house now. Spend less time on social media and more time reading / watching investment content.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We made 80K when we bought a 650K house. We had scrimped and saved for 10 years, lived in a crappy one-bedroom rental with our two young kids, in order to pay a downpayment sufficient enough to qualify for that mortgage with that income: 40%.

In the years I've been on DCUM, I have often come across posts like yours, OP. Invariably, the authors of the posts have not saved as much as they could have. Most don't have no idea what REAL belt-tightening entails. They've never lived like that.

You made choices. Own them. Home-ownership is not for everyone - like everything that matters in life, you need to be able to prioritize.

Bullshit. You didn't save $240k with 2 kids on $80k a year anywhere near DC without serious family help.

No family help. We used savings and sold Apple stock we had invested in previously.
We send money to our relatives. Not the reverse.

Ahh Apple stock. There you go.

I mean, good for you. Seriously. But that's LUCK and TIMING, PP. Come on.

Its always their "HARD WORK" and "BELT TIGHETENING"....ohhh right you had Apple stock If only one could buy Apple stock in when again? 80s? 90s? 2000s?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Depends on your debt and expenses, and your down payment.
A general number is 3x gross salary. But if you have a ton of debt, less than that.
Will your income grow in the next 3 years? If so, I’d do 1M now.

3x gross salary is outdated and not remotely realistic anymore for the non-wealthy.

Oh Please. She’s not getting anything under that. You have no idea if OP is at 250 HHI and stuck there, or 250 mid 30s with a potential climb to 400.

What? I mean that most people realistically spend way more than 3x gross salary because it is necessary unless they want to live in a tiny dumpy condo forever.

OP makes $250K, 3 times that is $750K. There are lots of good options for $750K in this area.

The 3x salary rule of thumb — shouldn’t it be calculated with monthly PITI vs monthly income, instead of annual income vs total home list price?

That way it accounts for current interest rates.

[Anonymous]

The way I originally heard the 3x salary rule of thumb described was that it wasn't about affordability (for that you look to other measures) - but rather a don't be an *ss rule. In other words, even if you can afford it don't be so much of an *ss to flaunt it with an enormous house. So I don't take it to be relevant here where land values are so high.
- someone with a modest house (worth well below 3x income) that is worth quite a bit less than the land it sits on

[Anonymous]

For what it's worth, you don't need to spend $1M, especially if you would be willing to live in a townhouse, a smaller SFH, and/or have a longer commute. Look at Rockville, look at some areas of NOVA that are farther out. This is what we're doing. Not everyone needs to live in Arlington or Bethesda. Look at school data sliced by SES - "good schools" aren't necessarily better or have magically better teaching, they just have more high SES kids. It's less a question of what's good vs. what proportion of high SES/high performing kids to help achieve a culture of higher expectations. Does the school have a solid cohort of kids who perform well and curriculum to help higher performing kids?

If you have less than that to put down, good luck. We expect to live very tight the next few years while praying to the interest rate Gods that we can refinance within a few years.

[Anonymous]

Anonymous wrote:I never saved a nickel I partied hard and spent more than I made when single.

I was then a passenger in a car crash 100 pervert drivers fault and even better an on duty cop witnessed it and driver confessed and took blame at scene.

That lawsuit was my downpayment. There is no morale to the story

In this market, I too would trade getting hit by 100 perverts for a down payment.

[Anonymous]

if you want to buy in this area, you're going to have to make some hard choices. Smaller space, like a TH, kids share a room (my kids liked to share!). Spend more on a house and have less for everything else (don't recommend unless your salary is going on upward trajectory), or move farther away or from the area altogether. You aren't going to be able to get a big house in a great school district, close-in, that is a reasonable percentage of your budget. Deal with the facts, make a choice, and move on.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We made much less than OP when we bought our house in CC Md.

But that was 1998 and I feel prices were lower then.

Gee, ya think?

incomes were lower and rates were higher too.

[Anonymous]

Here are some in Springfield and Burke-- ,you could probably keep your PITI around 5k

https://www.redfin.com/VA/Springfield/8814-Sweet-Gum-Pl-22153/home/9767607

https://www.redfin.com/VA/Burke/9757-Turnbuckle-Dr-22015/home/9766124

https://www.redfin.com/zipcode/22153/filter/viewport=38.79356:38.75354:-77.21475:-77.32341

[Anonymous]

Don't sleep on that Burke house, OP. It's a fantastic little neighborhood if your the outdoorsy type.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We made 80K when we bought a 650K house. We had scrimped and saved for 10 years, lived in a crappy one-bedroom rental with our two young kids, in order to pay a downpayment sufficient enough to qualify for that mortgage with that income: 40%.

In the years I've been on DCUM, I have often come across posts like yours, OP. Invariably, the authors of the posts have not saved as much as they could have. Most don't have no idea what REAL belt-tightening entails. They've never lived like that.

You made choices. Own them. Home-ownership is not for everyone - like everything that matters in life, you need to be able to prioritize.

This poster got lucky with Apple stock and is acting all high and mighty like they did it all on their own. 😂

They did do it on their own. It doesn’t mean their stock picking is a strategy other people will be able to replicate successfully though.

Exactly, they invested and it paid off. That's not a handout. The "saved out of our 80k salary" was maybe not the full picture though.

[Anonymous]

Anonymous wrote:My spouse and I saved like crazy. We lived in a crappy apartment took on extra work, worked our butts off at our FT jobs to get promoted, higher salaries then move on for a higher salary and another promotion.

We had no car. No Netflix. No vacations. No eating out. No take out unless work paid because we worked late. No cell phones (spouse had one through work). No internet. Used the library. Budgeted for everything. We invested our money for a down payment/ retirement. We did this for years.

When friends wanted to go to brunch I said I would meet for a walk or run instead. We did have people over to our tiny place but again budgeted.

We ended up shopping around and finding a couple banks that would lend us more $$ for a mortgage than anyone else. We knew our HHI would continue to grow and we also knew we are budgeters. So that’s what we did before covid. We lost our on 5-6 homes even then. We knew the area we wanted so we bought something a bit smaller but with a larger lot that needed some work, but are happy we did it. The first year was rough because our mortgage was so much more than our cheap rent. But soon we refinanced got rid of our PPi (we did not pay 20% down payment) and have been promoted and more $$ since. We also had a kid toward the end of the home price purchase and are diligent about saving for retirement and college. Our house is worth so much more $$ now and we get offers to buy it frequently. Our realtor tried to get us to look out more, but we knew where we wanted to be and stuck to it.

I have friends who lived the high life for years, renting at fancy buildings with gyms, a pool and concierge. Others rented fancy townhomes or drive a fancy leased BMW, Tesla, etc. That is their choice. Some now complain about the market and how they will never be able to afford a house, yet they don’t look back on their choices. When they were off in Miami over a long weekend I was working my second job or reading up on investing.

I have other friends who have fled in order to be able to buy a home. Two moved to Texas, another Midwest, and one for Europe. They all seem very happy and all bought beautiful homes for a fraction of what it costs in DC.

No cell phones? No internet? What year was this?

[Anonymous]

We make about that and our house was just under $500K, PITI is roughly $2500. BUT that was when interest rates were 3.5%