Nope. 500k would be my max.

Personally, I wouldn't do it. But it's doable.

I make 500K per year. I'm looking at buying a mobile home for financial "freedom". Can I afford 60K? I think that's pushing it. I net about 20K per month and don't feel comfortable at all thinking about this payment.

Threads like this are so dumb and shows how disconnected from reality the majority of people in DC are.

Yes, you can afford a $450k mortgage with a $100k emergency fund and little/no childcare costs. People on this site are strangely conservative - it’s almost a game. But, fwiw, asking about your mortgage size would have helped you. Many people here only read the title question, not the post.

Totally doable, we had 500k mortgage on 160k income and we never felt the pinch. But we had no childcare expenses, no student loans.

Given how much you're putting down and how much you have in the bank, I say go for it! A $450K mortgage is not bad at your income.

Anonymous wrote:Of course you can do it with that down payment. I don’t see why your PITI would be that high, though. Shouldn’t it be closer to 2500 on a 450k mortgage?

My mortgage is smaller than that and my PITI is a little higher (different area though); regardless I don’t know why people are freaking out. This is totally doable. Maybe people are answering without reading the details.

Are your salaries likely to increase? How stable are jobs? I'd probably use half the emergency fund for the down payment to get myself in a better house but I doubt you can afford both an office and a yard so pick one.

Op here. Regarding no childcare, I work a few hours a week and take all school vacations off, etc... so we don't need camps or before and aftercare. I still work some in summer but either hire high school age kid or a relative will watch them for free. Of course there are activities such a sports but they are not expensive at this point.

When the kids are a bit older, I'll get a regular job so will contribute to HHI. Before I cut my hours back I was making around 60k for 20 hour a week and would probably do something similar.

Anonymous wrote:Do you really have "no childcare expenses?"

I have 3 elementary kids and don't need before or after school care or all-day childcare.
However, we still pay close to $15K a year between summer camps (including a week of sleep-away camp for each), weekly piano lessons, sports, etc. It adds up quickly.

If your children are of age to not need adult supervision, then camps and lessons are not “childcare.” They are nice, but optional.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We financed $590 on a $700k house a couple years ago, with a PITI of about $3,200. I know interest rates have gone up since then, but no way is OP going to be paying more than 3-grand. I would think it'd be closer to $2400.

OK, well, we are in DC, have a $420k mortgage, no HOA (like most houses in DC), and have a PITI of 2500.

No taxes or insurance? Amazing.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You should have phrased question differently- Can we afford a mortgage of $450 on a HHI of 165k given that we have emergency savings of 100k and no childcare expenses?

The answer to that is yes. Our HHI is the same and our mortgage is $550k. It is doable. It is worth it to us to be in a better location with good neighborhood schools.

Yeah, I disagree with that. I think it's too high a debt to income ratio.

As to your other point, I also think that the total cost of the house matters. Financially, it matters for taxes. But it also matters in terms of neighbors and expectations. You're going to feel constant pressure throughout your lives just to keep up with the higher neighborhood "baseline."

In this area I don't think there's a big divide between the lifestyle of those in $700k houses vs those in $500k ones. They're both going to be fairly middle class.

I think your scenario is manageable, op.

I agree with this.

We have a similar HHI and our mortgage is similar to your current mortgage (~$2000). I would not be comfortable going as high as you’re proposing BUT we also have one (soon to be two) kids in daycare and a car payment. So maybe I’d feel differently in a few years. Our 1940s house also has “old house problems” and needed updates, so I can see the appeal in getting something more finished if/when we did decide to move.

I’d take a look at your budget and make sure you’re happy with what you’d have after the mortgage payment to fund retirement/college savings, necessities such as food/utilities/healthcare, and then $ to do occasional fun things like vacations and eating out without constantly being paranoid about money. If you’re already paying $2400/month, where would the extra $1000 per month come from?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:So your mortgage would be 450k and piti shouldn't be more than 3000, likely less. I think that is fine as long as your jobs are stable.

Not true. Go do full calculations. I know this because I financed 450k with a much lower interest rate than what is offered today. Depending on taxes and HOA and insurance it's around ~3200 and this is in my low tax county.

Absolutely true, at least for me in Bethesda. Borrowed 545k, piti is $3300. OP would be borrowing a full 100k less.

Seriously. I borrowed $550,000 in DC and my PITI is $2,800.

Some of it depends on your interest rate and terms - 15 vs. 30.

I would not. We took more than our max to get our dream house, and ended up with a $2300 house payment on $160k income. no debt other than the mortgage.

The extra 1k you'd be spending is our vacation/fun/small emergency budget. It's nice not being house poor, and it's nice to pretty much say yes to whatever we want to do. we wouldn't be able to do that with a higher house payment.