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Our median household income will be between 85-100k. What kind of home will this afford us in Shrewsbury? I've heard its a really expensive town but we love everything about it and have our hearts set on living there. Is it possible or should we toss out this dream?
Our median household income will be between 85-100k. What kind of home will this afford us in Shrewsbury? I've heard its a really expensive town but we love everything about it and have our hearts set on living there. Is it possible or should we toss out this dream?
I think you said in a different post that you are still in college so this is all rather hypothetical, right?
Let's say, for example, that you have a combined income of $90K. That is $7500 per month. Typically, you don't want your housing expense to exceed 30% of your gross monthy income, so 30% of $7500 is $2250.
At today's mortgage rates, $2250 per month translates to about a $360,000 mortgage. So if you had 10% to put down, you might be able to buy a place for $400,000.
Of course, don't forget about property taxes and if you have student loan payments and car loan payments, that may bring down the amount of mortgage you could actually qualify for, but this should give you some rough ideas.
[quote=gf2020;13053290]I think you said in a different post that you are still in college so this is all rather hypothetical, right?
quote]
Yes, we are still in college, but will be out within the next couple of years. We will probably be working in the Worcester area. The average salary for my girlfriend's career is reported to be between $50-65k and for myself will be between $35-45k. That's where my numbers are coming from.
So yes, the event of buying a home will not be for a while, but it can't hurt to plan ahead, especially when we both feel so at home in Shrewsbury after considering it for the past couple of years.
If you read my last thread (the one I believe you were refering to) I think Shrewsbury is the town that best fits my desired criteria as well.
Thank you so much for your helpful financial info, you've been a great help.
We do have our hearts set on Shrewsbury (at least as of now) because we love everything about the town: the location, its character, its neighborhoods, and its proximity to both Worcester and Boston, as well as its picturesque town center that is very walker-friendly.
I wouldn't consider the center of Shrewsbury walker-friendly, nobody really walks around there ... I grew up there. A great town to grow up in but it's a lot bigger now. Westborough and Northborough are also very comparable towns.
When it comes to loans, the banks are now looking at student loans, so you would need to find out, how much you would have to pay monthly, because that definately impacts borrowing dollars.
GF2020 gave some great advice on the financial aspects. It's always great to plan ahead. There are obviously variables only you can control such as: outstanding debt, credit score and down payment. Keep the first one low and the last two high and you are well on your way to home ownership. You will also have to show employment for a certain period of time (I am not sure what the requirement is now or will be when you are going to buy). The variables you can't control are: housing stock and prices which can and will change in the time period between now and purchase date. Will those changes be drastic? Who knows. Unless someone can predict the future I don't think there is a definitive answer to your question.
My advice is this: Since you are still very young, why don't you and your gf try renting a condo/apartment there for a year? This way, you will find out if Shrewsbury is really all that you imagine it to be. If so, you can spend that time learning about various neighborhoods and schools...where to buy and where NOT to buy. You can live frugally and stash some money away for your down payment. At the end of the year, if you still love it--dive in! If not, you won't be stuck.
Good luck to both of you!
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