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I'm curious for all the people who bought starter homes in the last few years how much savings you had right when you bought your first place (either a condo or town home or small home) and do you still have a good amount left/have you been able to sustain a nice balance or savings? How often do you dip into your savings in order to have to pay your mortgage or other bills?
I'm curious for all the people who bought starter homes in the last few years how much savings you had right when you bought your first place (either a condo or town home or small home) and do you still have a good amount left/have you been able to sustain a nice balance or savings? How often do you dip into your savings in order to have to pay your mortgage or other bills?
You do understand that the answer to that question should be "only in catastrophic circumstances," right? If you're dipping into savings to cover mortgage or other bills on a regular basis, you're overextended and need to rethink your monthly budget.
My house was a semi starter home, meaning the house was bought by a contractor who renovated some of it and then sold it. New carpets were put in, fresh paint, new bath and kitchen. Not high end by any means but move in ready and functional.I had no savings unfortunately but hubby did. We were able to out $30,000 down. To be honest after we purchased our home we were on a tight budget and that meant boxed mac and cheese, hot dogs and pasta for almost 6 months. We couldn't even afford steak LOL. Since then things have been a lot better. My weekly food budget for 2 people at that time was 60 bucks a week. We survived and are going on 11 years in our home.
After the downpayment and closing costs, we had enough savings for furnitures, painting, and other major renovations if needed. For the first 3-4 months we needed our savings for furnitures, painting of some rooms, new ac, new fence, and random household stuff like lawn mower. If you need to dip into your savings for mortgage and bills, you shouldn't be buying the house. How much is considered a starter home anyway?
I am clueless what a starter home is....esp in the nyc & its metro area.
It's all relative. Typically a house you first get into where you can start a family. 2-3 bedrooms and a lower price. We got into a starter home for $330k back in the early 2000s. There were some available in the mid-to-high 200's but they all needed work. Dual income is vital and few expenses (ie. living at home in your early 20s). 3 bed (1 was actually an office), 1 bath Levitt ranch. It was just the 2 of us then. We moved when we started to outgrow it (too much stuff with 2 new arrivals). They say the avg amount of time a family stays in a house is 7 years. We fit the statistic. Other people move into the burbs when they have a couple kids already and they wouldn't be looking for starter homes.
In another thread people were asking how others were able to save thousands every month. With a low mortgage and no kids.
I just looked - there are still plenty of starter homes to be had for $300k.
I agree with the previous poster that it is all relative. My starter home was more expensive but I waited until I was 30 and started saving very early. I think after down payment and closing costs, you should have at least 6 months emergency because you aren't gonna be certain something doesn't go wrong. If you plan on doing any renovations, plan on something going wrong. I tried doing a bathroom which lead to discovering a leak and termites and needless to say extra savings helped me get by. I believe banks are cutting down on letting people overextend themselves so if you went to get pre approved you'd find out they are stricter now than 10 years ago.
It's not over extension so much as the old saying what could go wrong would go wrong. Yes you should have something left over for expenses however, I will say no expense is bigger than finding out all that room/privacy you and the wife had led to a new addition to the family. Now that's a real expense if you were not prepared.
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