How can anyone afford a huge expensive home?!

[Anonymous]

I bought my first home for $139K in my 20's. Paid it off and sold it for $315K after 13 years. Bought current house for $710K 10 years ago with 25% down. Will pay off in another 13 years (less if I refinance which I'm working on now).

And for all those who think this is impossible, it is still possible now. There are still good homes under $150K in PG County where I live, that have rising equity. You can repeat this cycle there. But most here would never live in PG County so they end up house-poor or living in horrible overpriced tiny old homes.

[Anonymous]

Anonymous wrote:Np.

So... with a 230k income you all would think 600-700k is doable?

Uh, yeah.

[Anonymous]

We are married dentists.

[Anonymous]

Moved to area bought 900k home 8 years ago. No other bills so paid 2x mortgage every month over past few years. Sold last year with $400k equity from double pmt.....also have $100k sitting in bank. In 2016 Put $300k down on 1,6mm house. Mortgage is $6000 per month but HHI is $35k per month. Drive 2 paid-for luxury cars- 2005 and 2012, so no car pmt. DH is bank exec. I (wife) work in a small office. No family money, 2nd generation college. Student loans paid off. 2 Kids in public school in McLean.

Not house poor. But still cautious with our $. Just paid $25k for to have our 1st floor decorated and furnished (will furnish rest of house from existing stuff). Looking to buy new $50k car since 2005 van needs a lot of work. Will pay cash for it.

Every time we get bonus it goes into savings. Dh is finance person so we've been saving since before we married. $1MM net worth (even with debt in current new built house).

So it can be done. Only giving this much info because site is seemingly anonymous

[Anonymous]

Anonymous wrote:The question isn't how they can afford it (they make a lot of money) but why they want it. I would never want a huge mortgage payment. Just me I guess.

We have a small mortgage payment on our 1.1 mil home because we put 500K down.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We paid $500k in the 90s. Some was equity from our previous home. Did a $500k renovation about 10 years later. Worth $1.4m now. We used cash and a HELOC for the reno, and paid the HELOC off in about 3 years. We owe very little on it now. No family money or trusts just 2 working parents. It's not that complicated.

It isn't that complicated. Just get a time machine to the 90s.

The point is buy what you can, make it nicer, and then hopefully sell for a profit. Roll that into the next one.

Exactly. And be patient. While $500k bought a decent house in the 90s it needed work, and we waited 10 years before we did that work. At that point we could afford the renovation.

[Anonymous]

We worked like dogs as a PP said in our 20s. Worked full time and then each a few part-time gigs (babysitting, bar tending, etc) and saved enough for a down payment. Our HHI is $200k, we bought a house for $600k. Our income has gone up significantly in the past ten years and we no longer have the side gigs.

[Anonymous]

Anonymous wrote:We just bought and have a 600K mortgage. HHI of 165K. I know most DCUM would consider us overextended but the key for us is no other debt and an full emergency fund (6 months income), plus we have the option to rent out the basement if things get tight and cover 1/3 to 1/2 our mortgage. We are managing fine, paying for daycare and still saving 20%. We bought a condo at rock bottom prices right after we got married. Stockpiled savings while our mortgage was low. Sold the condo for 150% of purchase price 5 years later, rolled the proceeds into a down payment and voila!

Absolute moron.

[Anonymous]

VA Loan, no money down.

[Anonymous]

They have help from family, big help.

[Anonymous]

Anonymous wrote:Moved to area bought 900k home 8 years ago. No other bills so paid 2x mortgage every month over past few years. Sold last year with $400k equity from double pmt.....also have $100k sitting in bank. In 2016 Put $300k down on 1,6mm house. Mortgage is $6000 per month but HHI is $35k per month. Drive 2 paid-for luxury cars- 2005 and 2012, so no car pmt. DH is bank exec. I (wife) work in a small office. No family money, 2nd generation college. Student loans paid off. 2 Kids in public school in McLean.

Not house poor. But still cautious with our $. Just paid $25k for to have our 1st floor decorated and furnished (will furnish rest of house from existing stuff). Looking to buy new $50k car since 2005 van needs a lot of work. Will pay cash for it.

Every time we get bonus it goes into savings. Dh is finance person so we've been saving since before we married. $1MM net worth (even with debt in current new built house).

So it can be done. Only giving this much info because site is seemingly anonymous

Had you NOT paid double payment for 8 years, but instead invested that money in index funds, you would have nearly doubled that money. Your 400k of equity would have been at least 700k in in initial investment + returns.

[Anonymous]

Anonymous wrote:We bought 15 years ago for $600K (not inexpensive, I know) but to buy in our neighborhood is now $900K. A lot of it is timing. And for us, the rest is having a dh who works entirely too much at a good paying job. Not worth it.

Yeah, we also bought fifteen years ago but only paid $200k. Note houses in our neighborhood go for north of $1000000. It's timing but also being smart. I took a risk on a close in neighborhood in DC with great architecture that was considered transitional and is now very hip.

[Anonymous]

I bought before the boom, held, sold at the top of the market and used my equity to buy myself up into a bigger, better place. In that same time period my income grew and interest rates stayed low.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We paid $500k in the 90s. Some was equity from our previous home. Did a $500k renovation about 10 years later. Worth $1.4m now. We used cash and a HELOC for the reno, and paid the HELOC off in about 3 years. We owe very little on it now. No family money or trusts just 2 working parents. It's not that complicated.

It isn't that complicated. Just get a time machine to the 90s.

The point is buy what you can, make it nicer, and then hopefully sell for a profit. Roll that into the next one.

Exactly. And be patient. While $500k bought a decent house in the 90s it needed work, and we waited 10 years before we did that work. At that point we could afford the renovation.

Ok, but "it isn't that complicated" is a little patronizing to those of us who weren't able to buy in the 90s. In my neighborhood, houses went from $200k to over $500k between the late 90s and around 2005. They have since risen maybe 10%. Some of this is pure luck and timing.

[Anonymous]

Anonymous wrote:They make a lot more money than you do.

This why is it hard for you to understand?