What's the house price you would be comfortable with?

[Anonymous]

Dh makes around 300k each year and I bring in about 60k. Our income has increased quite a bit in recent years, and there is potential for it to continue to grow significantly. We are looking to buy a home before our first child is born. We have not decided whether I will work or stay home at this point. We have saved 300k to put down on a home. We have no debt and a nice emergency fund. I am thinking that $1.2 million is the top of our budget. Less if interest rates increase significantly. Would you consider this conservative, risky, or somewhere in the middle. For the record, DH and I both have very stable employment.

[Anonymous]

We just bought at $1.27 with HHI of $275k and I feel totally comfortable with that decision.

[Anonymous]

Anonymous wrote:Dh makes around 300k each year and I bring in about 60k. Our income has increased quite a bit in recent years, and there is potential for it to continue to grow significantly. We are looking to buy a home before our first child is born. We have not decided whether I will work or stay home at this point. We have saved 300k to put down on a home. We have no debt and a nice emergency fund. I am thinking that $1.2 million is the top of our budget. Less if interest rates increase significantly. Would you consider this conservative, risky, or somewhere in the middle. For the record, DH and I both have very stable employment.

It all depends on your circumstances and your budget.

Back in the day, the old rule of thumb used to be 1.5 times your household income. So when I was a single girl buying my first condo at $360K mortage, I was scared shitless (4x my gross annual income at the time).

Now, people tend to use the monthly payment as % of gross income per month metric:
?The front-end debt-to-income ratio – mortgage payment (PITI) divided by gross income – should be less than 31%.
?The back-end debt-to-income ratio – mortgage payment plus all recurring monthly debt, all divided by gross income – should be less than 43%.

Based on that above and depending on your down payment, then it means a multiple of 3-5x your income. Not counting your income as you might decide to stay at home, then that means a house between $900K-$1.5M

So your present budget of $1.2M is not the most aggressive, but neither is it conservative.

[Anonymous]

We have a similar HHI and just bought a fixer for 930k. We will need to put about 30-50k into fixes. We wanted wiggle room in case one of us chooses to take a just with better hours and less pay.

[Anonymous]

I would be comfortable with $1.2M as a limit and think that is a wise price point to stay at or under.

I'd plan on you staying at home TBH.

[Anonymous]

Anonymous wrote:I would be comfortable with $1.2M as a limit and think that is a wise price point to stay at or under.

I'd plan on you staying at home TBH.

Thanks for the advice. We tend to be financially conservative so we are having a hard time feeling confiddnt enough to pull the trigger.

I will definitely stay home the 1st year. Not sure if I will stay home long-term.

[Anonymous]

Make 250, spent 700K with 25% down.

[Anonymous]

I go by the standard 3x HHI rule of thumb which you fall under. I say go for it!