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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Wait, you have $250,000 in cash savings?  Pay down the mortgage and refinance.[/quote]

Why would we do this? We have  3.85% interest rate which is tax deductible.  I am earning 2.2% on the CD it is in and it provides us enormous flexibility (like considering to stay home and use it as cushion, hence why we haven't plowed it into stocks or investment property).

If we paid down mortgage and refinanced, we might push down our mortgage to the $2700 I looked at earlier, but that is still unworkable.  Being able to paydown the house so we have a $230k mortgage is beyond the means and two bedroom condos in our neighborhood go for $700k (our TH is $850k).

Moving seems like the only way; so for everyone SAH on $100k incomes, you live out in exurbs in sub-$400k houses?[/quote]

So to answer your question here, we live in the city, in a house, in a very nice neighborhod, a few minutes walk from a metro, primarily on my husband's 75k salary. It is very doable, but not with your current expenses and it doesn't seem like you're willing or able to make the more drastic changes that would make this a good decision for you. We max out TSP and roths for each of us, go on several vacations per year, eat organic foods and still save additional each month. To make this work we live VERY frugally otherwise and earn extra income in other ways like me babysitting, dog walking, renting out a room in our house etc. You have to pick and choose what means the most to you and it sounds like your house means the most.

We cannot buy in our area (well its possibke, but we couldn't get anything nearly as nice as what we have). Meanwhile rent prices have not kept up with housing prices here and we found an especially affordable home that costs less than half what you pay per month. If you look at the rent vs buy calculators for houses in our area, they will tell you that with that large of a discrepancy in rent v buying prices, it is a better investment to rent and invest the difference in an index fund. You could lose the second salary, but you have to really think outside the box and make those big changes you consider off the table.[/quote]

We rented for a long long time, and only bought when buying was cheaper month-to-month then renting (in close in suburbs with good schools, two bedroom apartments now cost more than the mortgage on a small TH, b/c of low rates and escalating rents).  trust us, we were a family of 4 living in close-in suburbs in a two bedroom.  the rent for an ok apartment (i know kind of fancy b/c we are looking for a/c and washer dryer in the unit), the rent is going to be $3k/month which after tax deduction is our about our PITI.  i would make about $15k too much to qualify for affordable housing, so we would into the income range that ends up moving to burke i guess.

we *only* care about the 'house' as a means to a) freeze our monthly housing cost and b) provide stability to same in the same good school district.  it is not fancy, and is in a shady part of a good school district (what other DCUM have called this neighborhood).  we are reluctant to change schools b/c DC is doing great at her current school and education is one of our top priorities, period.  what do you do for schools in DC? I'm guessing a charter?  basically if you win the charter lottery, that is like winning the lottery -- you can move wily-nily and live where rent is cheap and not worry about the schools.  we should have taken that plunge i guess, but taking the charter gamble now would be very difficult.

will look at housing options at burke or rockville; but DW is reluctant to change schools; for both of us it is what we feel is best for kids and unsure if losing a school, neighborhood, and friends they love is worth having a parent at home and seeing the other parent far far less b/c of commute etc.

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