Anonymous wrote:

Anonymous wrote:

Anonymous wrote:This thread perfectly illustrates why people are choosing to leave HCOL cities like DC and NYC. Why be house poor and stretch your budget just to make sure your child goes to a good school or you have access to good restaurants or things to do? Reading this thread has really reaffirmed my desire to leave this area and WFH permanently. Thankfully I am in an in demand field and no matter the state of the economy finding a remote job in the event I ever get laid off or fired will be very easy. And like a previous poster said 2020 and the next few years is not the time to be burdening yourself with high house payments or any other liability really. The economic fallout of this crisis has yet to be fully felt and you never know what will happen in the coming months to years.

Great to be optimistic about your skills. However there is one variable that is very difficult to control - HEALTH!

Please elaborate. You don’t have to be in a major city to get covid treatment, if that’s what you’re implying.

What I am saying is that major health events such as cancer do happen and are costly both socially and economically. I am speaking from experience. My wife went through a major health even and despite excellent heath insurance we faced 100k in medical bills over several years. I had to leave my job and when I came back I simply wasn’t the most attractive candidate. But this is life. We should always be optimistic about the future, but we need to be careful as well.

The issue honestly is that as Americans we are simply taught to spend spend spend spend..... Even those of us who try to practice budgetary discipline many times live beyond our means.... This is just a future of our culture.

Anonymous wrote:

Anonymous wrote:This thread perfectly illustrates why people are choosing to leave HCOL cities like DC and NYC. Why be house poor and stretch your budget just to make sure your child goes to a good school or you have access to good restaurants or things to do? Reading this thread has really reaffirmed my desire to leave this area and WFH permanently. Thankfully I am in an in demand field and no matter the state of the economy finding a remote job in the event I ever get laid off or fired will be very easy. And like a previous poster said 2020 and the next few years is not the time to be burdening yourself with high house payments or any other liability really. The economic fallout of this crisis has yet to be fully felt and you never know what will happen in the coming months to years.

Great to be optimistic about your skills. However there is one variable that is very difficult to control - HEALTH!

Please elaborate. You don’t have to be in a major city to get covid treatment, if that’s what you’re implying.

Anonymous wrote:This thread perfectly illustrates why people are choosing to leave HCOL cities like DC and NYC. Why be house poor and stretch your budget just to make sure your child goes to a good school or you have access to good restaurants or things to do? Reading this thread has really reaffirmed my desire to leave this area and WFH permanently. Thankfully I am in an in demand field and no matter the state of the economy finding a remote job in the event I ever get laid off or fired will be very easy. And like a previous poster said 2020 and the next few years is not the time to be burdening yourself with high house payments or any other liability really. The economic fallout of this crisis has yet to be fully felt and you never know what will happen in the coming months to years.

Great to be optimistic about your skills. However there is one variable that is very difficult to control - HEALTH!

House poor = pandemic living( no vacations, no restaurants and no kid activities.

This thread perfectly illustrates why people are choosing to leave HCOL cities like DC and NYC. Why be house poor and stretch your budget just to make sure your child goes to a good school or you have access to good restaurants or things to do? Reading this thread has really reaffirmed my desire to leave this area and WFH permanently. Thankfully I am in an in demand field and no matter the state of the economy finding a remote job in the event I ever get laid off or fired will be very easy. And like a previous poster said 2020 and the next few years is not the time to be burdening yourself with high house payments or any other liability really. The economic fallout of this crisis has yet to be fully felt and you never know what will happen in the coming months to years.

We're probably officially house poor, and honestly - I think it's just how it can be in this region. We're probably in reality smack in the middle of our peers (based on observation of the neighborhood school) The OP's stats are much better than ours - we're not great savers, but put away what's probably enough for retirement, and almost enough for 529's.

It does mean not spending as freely as we might otherwise be inclined to do: the cars we want when we want, designer clothes and travel. I guess we're house poor, but not house poverty-stricken (we'll take a nice vacation every two or three years, but not every year) It does involve a level of optimism/denial I suppose, but we do also really love our house, even if it means some Ikea furniture or hand-me-downs instead of fancier furniture in a more modest house.

Anonymous wrote:

Anonymous wrote:

No eating out. No vacations. No activities for your kids. No splurges. No new clothes. No going to the movies. No replacing things that get broken that aren't necessities. No upgrading phones. No streaming services.

This is how I grew up. Nice house. Nothing else. It also means extreme stress in every recession or downturn. Even as a kid, I constantly worried that we'd end up homeless because there was no padding. It was our really nice house or, if my dad lost his job, our car.

As a a kid, why were you burdened with the knowledge of your parents' finances? My kids are completely unaware of our financial situation.

Different scenario, but growing up poor I was very well aware of our financial situation. It would have been impossible not to be. We were "school poor"-my parents spent all of their (little) extra money on private school. Not worth it IMO.

Anyway for the OP, NBD for a year or a couple years. For an extended period, not worth it.

OP, it depends on how you define "dream house". If it's just the house itself that is perfect, I'm not sure that's enough to tie up all your money in it. You will be surprised how much your priorities change in just 5 years. I wanted to live in a very different sort of house when I was 33 than I do at 43.

But if the house is in exactly the neighborhood where you want to raise your kids, and you like the local schools, and stretching will allow you to be in that neighbor hood with good public schools, I absolutely think it's worth it. Those are intangibles that are impossible to replicate. A house can be remodeled or even added to when you have the money. You can't change the neighborhood or schools without moving.

Plus, if it's a good neighborhood with good schools, it will also probably gain in value faster than it would elsewhere, which means you could refinance at some point if you wanted to reduce your monthly payment.

Anonymous wrote:

Anonymous wrote:

No eating out. No vacations. No activities for your kids. No splurges. No new clothes. No going to the movies. No replacing things that get broken that aren't necessities. No upgrading phones. No streaming services.

This is how I grew up. Nice house. Nothing else. It also means extreme stress in every recession or downturn. Even as a kid, I constantly worried that we'd end up homeless because there was no padding. It was our really nice house or, if my dad lost his job, our car.

As a a kid, why were you burdened with the knowledge of your parents' finances? My kids are completely unaware of our financial situation.

DP. I don’t know why! My parents made me pay for stuff with bday gift money from a really young age, I handled college FA and stuff on my own, etc

Anonymous wrote:

Anonymous wrote:

No eating out. No vacations. No activities for your kids. No splurges. No new clothes. No going to the movies. No replacing things that get broken that aren't necessities. No upgrading phones. No streaming services.

This is how I grew up. Nice house. Nothing else. It also means extreme stress in every recession or downturn. Even as a kid, I constantly worried that we'd end up homeless because there was no padding. It was our really nice house or, if my dad lost his job, our car.

As a a kid, why were you burdened with the knowledge of your parents' finances? My kids are completely unaware of our financial situation.

It's not that hard as a kid to figure out that your parents have no extra money. We were literally eating rice and beans at times. My parents would fight about utilities, grocery budgets, and buying kid shoes. My mom would spend hours at the grocery store with four kids in tow trying to get the bill down. We wouldn't be allowed a second cup of milk because it was rationed over the week. This level of tension went up when my dad was worried about being laid off. It went up even more when he was out of work. They never explicitly told me any of this when I was younger, but I was an observant kid. By high school they were more explicit and it all fit together.

We lived in a lovely 3,000 sq ft home in a nice suburb and my dad worked a good white collar job. I always had my needs met, but we never took a vacation, went to the movies, went out to eat, or bought anything just because. Never.

Anonymous wrote:

No eating out. No vacations. No activities for your kids. No splurges. No new clothes. No going to the movies. No replacing things that get broken that aren't necessities. No upgrading phones. No streaming services.

This is how I grew up. Nice house. Nothing else. It also means extreme stress in every recession or downturn. Even as a kid, I constantly worried that we'd end up homeless because there was no padding. It was our really nice house or, if my dad lost his job, our car.

As a a kid, why were you burdened with the knowledge of your parents' finances? My kids are completely unaware of our financial situation.

Anonymous wrote:We did this. It was fine. I’d prefer doing that (within reason) to buying a house we weren’t happy with and wanted to trade up.

Agreed. I would rather tough it out for a time in something that I want, than buy something I can afford yet hate.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

No eating out. No vacations. No activities for your kids. No splurges. No new clothes. No going to the movies. No replacing things that get broken that aren't necessities. No upgrading phones. No streaming services.

This is how I grew up. Nice house. Nothing else. It also means extreme stress in every recession or downturn. Even as a kid, I constantly worried that we'd end up homeless because there was no padding. It was our really nice house or, if my dad lost his job, our car.

OP said it would be tight for a year or so. I agree with you if it’s for several years, but I’d happily forego a year or two of vacations and extras to trade off for a house. Especially now that we’re home so much.

It really depends how tight and why they expect it to get better. When my parents bought they thought it would be tight temporarily, but then expected promotions and raises didnt come through. Then there were some unexpected but necessary home and car repairs. Then there was a drop in home values so selling wasn't an option. Add in some minor health issues that caused some medical bills, and things got really tight. They never dug themselves out of the decision to buy that house.

This was my family's experience too, they expected it to get better....and then a bunch of things happened all at once and they never really dug themselves out either.

Anonymous wrote:We are thinking of stretching for our dream home. The first year will be tight, but we will be more comfortable after that. We would still plan to have 6 mos of expenses in cash, and another 12 months in liquid assets. We will need a few furniture pieces eventually, but most everything we currently own is relatively new. We are also planning for issues that aren’t caught in the home inspection, but no reno needed.

My parents did this OP, and I'm not sure it was worth it. They came from poverty and their dream was to own a beautiful home, now that their kids are grown, I'm not sure they would say it was worth it.

Even though we lived in a nice neighborhood and our house was beautiful, we were very poor. No new clothes for them, no new clothes for kids. No vacations. No eating out, ever. They couldn't afford to send us on school trips. We couldn't go see our family. It just sucked. It was also confusing as a kid, we looked rich if you looked at our house but we lived like we were poor. Our house was also quite barren because they couldn't afford furniture and they couldn't afford renovations over the years. It's also more expensive to maintain the house in general, utilities and repairs are more expensive. The worst of it was during the recession when my dad was laid off and then had to take a lower-paying job.

I guess it depends on how much you're stretching your budget though, I would just be cognizant. I love my parents and I'm grateful that they worked so hard to try to provide us a better life, but I would always choose disposable income over a nice house having grown up in the opposite situation.