Reply to If you bought a house over $1.5 were you able to afford to do so on your salaries or equity?

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Reply to "If you bought a house over $1.5 were you able to afford to do so on your salaries or equity?"

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]$1.5m with 20% down at 3.5% interest should be under $7k/month, or $84k/year.  Even at $300k HHI that's still less than 1/3 of your gross income.  Understandable if that still makes you uncomfortable but you're competing against a lot of buyers who will stretch themselves much further to make things work.[/quote]

That mortgage is an insane amount. We make around 500K, I'm a fed, and we couldn't pull 7K/month without huge sacrifices. We wouldn't be able to save a lot, travel, afford cleaning services and quality food, pay for the kids' tuition etc. [/quote]

We're at $400K (salaries + bonus) and NO WAY in hell would we ever feel comfortable buying at $1.5M house.  We purchased in 2020, house was $1.21M, mortgage + taxes and insurance = $5100 a month. We max out our 401K, we barely travel - vacation every 2 years, kids are in public.

$1.5M at $300K is insanity. You would be eating PBJ for the rest of your life.[/quote]
I'm not trying to be snarky, I'm genuinely interested in your expenses. 
$400K gross
- $20K 401k contribution (savings)
- $80K taxes
- $61K housing
= $239K take home pay

What do you spend that on? Also, the difference of $1.2M vs $1.5M house is $20K/year more.
If $20K is stretching your budget and what causes you to go on a PBJ diet, than you really should look somewhere else as the source of expenses. 
[/quote]

I think you’re way under on 401 k and taxes. And health care. [/quote]

Yep, I'm PP this person is referring to.  They underestimated everything to try to prove a point.  Our health care costs were actually not even include on their "detailed" list.  Premiums alone are $12K a year and that's if we never step foot in a doctor's office. Add another $24K a year for DS's needs.  401K was vastly underestimated. Federal and state $92K. Then there's of course home maintenance which PP conveniently also left off the list.  I would estimate we on average spend around $7K a year on just general maintenance - this is the normal stuff not huge expenses like a roof leak.

I'm not sure what happened to this board but everyone used to lean way more conservative when it came to finances. Not too long ago anyone considering buying a $1.5M house on a $400K income would have been chastised for their irresponsible spending.  [/quote]

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