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^ even with little savings after 3 years (age 24) you can surely come up with 20k down between 2 people? How's $1500/mo. per person (includes $10k taxes) sound to you? Is that so impossible? You pull in ~$3k net a month if you make $50k. How is this "very very hard"? I'm not saying everyone is making 50k, but many do and this is a feasible scenario that's not "very very hard".
Quote:
Originally Posted by FrmlyBklyn
Your math seems a little off, if your pulling in 50k annually, how are you making 3K net per month? Fed tax of 18%, State tax of 4%, SS 6.2%, Medicare 1.45% - who's paying for health insurance and retirement? If you go without the last two, then you can get to 3K net.
Its off. 50K is bringing in about 2600/mo after taxes and retirement (as per some old paychecks), its also a pretty healthy salary for a 24 y/o today. Now you have car insurance, food, cell phone, and maybe rent, skipping other purchases.
That leaves about 1025-1250, more if they split the rent. Thats not starting in with cars, computers, cable, internet, utilities, gas, professional obligations (suits, meetings, classes, expenses), vacation, or any sort of going out. Basically your a hermit. And your a hermit thats got a under a thousand dollars each month. But lets say they can both afford to save 1K/mo. You need a minimum of 20% down in to get a decent loan these days, and its good practice anyway. Average home in Suffolk is mid 3's, we'll say 350K. That means little Joey and Susie need to save for three years straight to afford the down payment on a home.
So Joey and Suzie deccide to go house hunting 3 years of savings later. They find a home, get the down payment secured, get a loan with todays great rates (4.5%), and find get a sub-average 7K in taxes. $1418 in mortgage and $583 in taxes. Even with this light load, they are at 40% of their net pay to just pay off the home, a frankly unaffordable rate.
^ close to what I was thinking. Actually I think insurance at 200/mo. is high. I am paying $250 for 6 months on my truck = $40/mo (maybe times 2 for 2 cars). Home insurance is $70/mo. Remember, you're splitting these on top of that. And rent is a big maybe nowadays... more & more staying with their parents out of school.
50k isn't set in stone and neither are: "cars, computers, cable, internet, professional obligations (suits, meetings, classes, expenses), vacation, or any sort of going out." Nobody said it was desirable to live like this but if you want to, many make worse sacrifices (my classmate buying a Plainview house right out of college for instance). All I said at the beginning was high 300s isn't out of reach. The numbers show that.
^ I like your numbers as they are what I was thinking. 50k isn't set in stone and neither are: "cars, computers, cable, internet, professional obligations (suits, meetings, classes, expenses), vacation, or any sort of going out." Nobody said it was desirable to live like this but if you want to, many make worse sacrifices (my classmate buying a Plainview house right out of college for instance). All I said at the beginning was high 300s isn't out of reach. The numbers show that.
40% of your net pay is out of reach though. By the time your finished with homeowners insurance, utilities, maintenence, and all the other points of owning a home your easily over 50% of your paycheck. Thats precious little to spread around of nessecities of life, never mind savings.
I think most trade up homes are in the 400 range for the average person. And yea, theres plenty of homes in that range, but not many "trade ups", more like lateral trades. Usually when you trade up you get more land, more space, etc. but not on LI. The homes that I have found in this range are killed by some crazy tax structure (mainly looking in Manorville). Sorry, but I'm not paying $15,0000 per year in taxes!
Manorville taxes will be going up. Look farther east.
^ close to what I was thinking. Actually I think insurance at 200/mo. is high. I am paying $250 for 6 months on my truck = $40/mo (maybe times 2 for 2 cars). Home insurance is $70/mo. Remember, you're splitting these on top of that. And rent is a big maybe nowadays... more & more staying with their parents out of school.
50k isn't set in stone and neither are: "cars, computers, cable, internet, professional obligations (suits, meetings, classes, expenses), vacation, or any sort of going out." Nobody said it was desirable to live like this but if you want to, many make worse sacrifices (my classmate buying a Plainview house right out of college for instance). All I said at the beginning was high 300s isn't out of reach. The numbers show that.
Where did s/he get the downpayment "right out of college?"
Lets face it, it takes years if not decades to save 20% for a down payment on a home while renting.
Decades? I don't think so. We saved a down payment in 2 years of renting. We lived off one salary, and we were making an average salary for Long Island.
The problem always comes back to the taxes. Even if you can get a house in the $300Ks, your taxes are going to be high and you know they will always be going higher...every single year. There's no relief from that and people have to take that into consideration.
Decades? I don't think so. We saved a down payment in 2 years of renting. We lived off one salary, and we were making an average salary for Long Island.
Say you were in the same situation today (first time buyer renting while saving) and wanted to buy your house. Would it have only taken 2 years to save for the downpayment considering prices today?
Quote:
Originally Posted by twingles
The problem always comes back to the taxes. Even if you can get a house in the $300Ks, your taxes are going to be high and you know they will always be going higher...every single year. There's no relief from that and people have to take that into consideration.
That is the big problem here. I totally agree with you. I remember another post you made about how you were moving because you didn't want to continue to put five figures of your cash into the greedy union pockets each year instead of into the bank for yourself and you are right on target! These days nobody is getting raises "just for showing up" anymore ... except certain public employees and it all comes out of the taxpayers' pockets. The only hope is if whoever becomes governor actually DOES SOMETHING about the property taxes. If not, forget it. Even me, the "die hard LI'er" will be out of here too eventually.
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