Reply to Afford $1.8M on 300K?

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[quote=Anonymous][quote=Anonymous]
I have posted a couple of times already - I said that we stayed in our house and fixed it up and the extra money each month gives us flexibility, etc. It sounds like you have your mind made up and this is what you want to do. I hope that your income is straight salary and not dependent on bonuses bc if you have a bad year, you won’t be able to pay all of your expenses. I also want to add that when you look at the median income for, say, McLean, it also includes all of the condo buildings (I’m assuming). Plus you have to remember that a lot of people bought their homes years ago when prices were much lower and they may retired now but they likely have a lot of assets (which is what allows them to stay in their homes which are now worth a lot of money). I think you are assuming that all of your expenses will stay the same except for your mortgage. Have you checked the property taxes? Utilities? Landscaping costs? Put all that into your budget and see how much you have left over every month. [/quote]

Op here. Good points.   some responses

- I'm not keen on fixing up and/or expanding the current house beyond what's normal in the current neighborhood. If I have a 4000 sqft house in a neighborhood of 2000 sqft houses, it will be very hard to sell 5-15 years from now.  I see neighborhoods in the midst of teardowns/rebuilds, and I'd rather not deal with those issues.  (I think) it's better to just move into a neighborhood of 4000 sqft houses instead.

- we're civil servants, so income is just salary and pretty much steady until we retire, which we don't plan to do any time soon. so no income volatility.  For those asking about college - I think there's a separate but real DCUM conversation on how much college costs should be prepaid by parents (rather than leveraging student loans ).

- our mind is certainly not made up. this arose out of a conversation where we were wondering "what do we do with the extra $6K?  venture into a bear market? buy a rental property? trade-up our house? If the third option, could we possibly afford (for example) a 4000 sqft house in a Langley pyramid neighborhood with a short commute to Tysons?

- I chose the census data area ( https://data.census.gov/cedsci/profile?g=1400000US51059460100) specifically because that area has no condos/townhouses. Certainly if you include the townhouses/condos, the median HHI goes down - but I'm just using SFH HHIs as my comparison. And that's at (or just above) $200K.

- property taxes should project proportionally with the property value/size. Utilities, on the other hand, are a tossup. We're paying $300 for gas and electricity, $100 for cell and internet, and $250 quarterly for Water. Even if those doubles, that's still doable.  But if it triples or quadruples, yeah that's a concern.   [/quote]

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