Anonymous wrote:Back in to it. Figure out what monthly payment you can handle on your net pay. Interest rates are going up, so some of it will depend on when you buy. Don't forget to factor in taxes, insurance and childcare.

Yup. Monthly payment is so much more important than the price of the house.

Don't have kids and get the 700k house.

OP, what were you spending money on in your 20s and 30s that you only have $50K saved!? If you don't have kids and want a house, you need to save until you have 20%. This shouldn't be hard -- DH and I managed to save $140K in our mid-to-late 20s on a $85K HHI! We're early/mid 30s now and only have a $190K HHI but still have more in retirement than you. This tells me you need to tighten your spending belt and up your savings.

Look at your budget and see where you can be saving more. If you want to live in a good school district it's worth cutting some expenses now so you can buy where you want.

Agree with PPs that childcare expenses are crazy (for two kids, it's essentially the same as our mortgage payment, if not a little more). Don't underestimate how much kids cost when figuring out how much you can spend.

OP - if you listen to the over conservative scolds on DCUM, you'll underbuy and regret it and then spend even more money in a few years in closing costs and aggravation to get into a better house/neighborhood. Do the math and figure out what can work for you. Keep in mind tho that once you lock in a 30 year mortgage, housing costs will remain flat (with some increases in taxes/insurance). Think about how much you paid in rent 20 years ago vs. what you pay now. Having that 10 year old rent now would be pretty sweet, right? That's what it'll be like in 10 years with your mortgage.

Anonymous wrote:

Anonymous wrote:Have been talking with financial planner and are looking to buy a place. Spouse and I have pretty different ideas on how much we can spend on a house.
- HHI 215K. One of us near the top of our range; another has potential to go up maybe 50-80K
- We are early-mid 30s; no kids; would like to start trying soon
- Retirement savings of around 230K
- Not much savings for downpayment, only around 50K
- Good credit ratings so hopefully good mortgage rates?

What do you think? One of us wants to stick under 500K, the other wants to go up to 700K.

400k max

That's hilarious. Where can you even buy for 400k closer than woodbridge or Winchester? I have friends who are looking to spend $450k on $78k yearly salary so I'm sure OP at $215 can swing a bit higher than 400.

Anonymous wrote:Have been talking with financial planner and are looking to buy a place. Spouse and I have pretty different ideas on how much we can spend on a house.
- HHI 215K. One of us near the top of our range; another has potential to go up maybe 50-80K
- We are early-mid 30s; no kids; would like to start trying soon
- Retirement savings of around 230K
- Not much savings for downpayment, only around 50K
- Good credit ratings so hopefully good mortgage rates?

What do you think? One of us wants to stick under 500K, the other wants to go up to 700K.

400k max

Wait another year and buy in 700 range. Easily doable on your HHI.

Anonymous wrote:

Anonymous wrote:We paid $700k. in that income, but it is my husbands income and I SAHM so minimal childcare costs (just PT preschool.) but we also put down the full $140k.

...so IOW, nothing like the OP's situation!!

Sorry I thought my point was obvious. I wouldn't have spent that much with only $50k down and childcare bills.

We make just a little more than you (10%) and recently bought at just under 700K with two kids in daycare. I'd talk to a mortgage broker about options with little downpayment. I would not be surprised if you find waiting until you have 20% to put down will make much more financial sense. We found that the difference in paying $500K and $700K was a wash when you factored in that $500K neighborhoods more often meant private school. Also, we're big savers and had 20% down plus some.

We used a daycare in N. Arlington. Infants were a bit more than $1800/month. At almost 4 yo, it's now $1500/mo. A daycare farther out will almost certainly be cheaper.

Anonymous wrote:

Anonymous wrote:Thanks, I am the OP. Is it really 2K per kid per month for child care? We had been thinking closer to 1500. FWIW we are planning to buy further out, but I don't think that would impact childcare costs that much.

$2,000 a month seems awfully high. I'd say $1500 is more the upper end for infant care at a center (unless you're using daycare in downtown DC). And, costs go down by a couple hundred when the child turns two or three depending on the center.

We pay $2k a month with an au pair (annualizing all the expenses). Nannies are (a lot) more, daycare less, Nanny share is less and home daycare even less. Just depends on what you choose for childcare.

Anonymous wrote:Thanks, I am the OP. Is it really 2K per kid per month for child care? We had been thinking closer to 1500. FWIW we are planning to buy further out, but I don't think that would impact childcare costs that much.

$2,000 a month seems awfully high. I'd say $1500 is more the upper end for infant care at a center (unless you're using daycare in downtown DC). And, costs go down by a couple hundred when the child turns two or three depending on the center.

I agree with recommendations to back into your monthly payment--so include an estimate for taxes, an increase in utilities. Consider also the potential for increased transportation expenses. Might you need to buy a car where you would end up buying, for instance?

And estimate child costs…especially for the years you might overlap. If you're already mid-30s, I'm guessing you'd space your kids close together.

Thanks, I am the OP. Is it really 2K per kid per month for child care? We had been thinking closer to 1500. FWIW we are planning to buy further out, but I don't think that would impact childcare costs that much.

Think about when you want to have kids and set a plan to be in a house around that time. Take a year or two to really save aggressively and start finding the neighborhoods you want to live in, that way you can watch those neighborhoods closely and be able to act quickly when your house comes up.

Cut everything out that you don't need now and try and live as cheaply as you can off one income (or less), save the other. In two years you should be able to have another 100-150k, which would give you a 200k down payment. That would give you options.

If you want a sfh I would not buy a th as a starter - no idea where the market will go and no reason to lose the commission in a few years when you try to move up. Find something that will do for 10 years at least.