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Hi all,
Looking for some advice. Husband and I don't have traditional salary jobs, we own a new business that is doing well. We are looking at a house at the 450k mark in south Florida. We are putting 160k down. We have zero debt, and cars are paid off. After our down payment we have about 150k in savings and 26k in retirement. We are under 30 years old. Business is only 3 years old but last year we netted 420k. Projecting to have a similar year. This is our first home and very stressful, we just don't know if we are crazy buying that expensive of a house. Any opinions would be greatly appreciated.
Thanks. The uncertainty here though is whether the business continues to do good. It's too soon to tell if this income will be long term.
Then you probably shouldn't be buying a house where the mortgage payment exdeeds the amount you guys could afford to pay if you were working for somebody else. Better yet, pay on one paycheck.
I always suggest buying a house not based on what you make right now, but what you would make if you suddenly lost your job or business went south. If you're a Nurse making $80k chances are you can find another job as a nurse making a similar salary if you had to. If you work for a small firm making $250k and they suddenly closed up shop maybe your title is only good for $125k somewhere else.
For the amount of $ you have cash, how much you're putting down, and your lack of other debt I'd say you're fine. If you both had to get jobs if the business went under you're bills would be low enough that you should be able to handle them pretty easy even with a lower paying job.
What business are you in if you don't mind me asking?
I think you can probably afford the house bc the mortgage only on the 300k is about $1500. Without knowing the property taxes and insurance, I'll just tack on 300/month. If you want a 450k home, I'm assuming that you're used to living in a nicer place so what are you paying for rent now? IMHO, you can afford the actual house part bc $1800 is reasonable for your needs but.... can you afford to maintain it and furnish it? That's where you have to really crunch your absolute WORST scenario income numbers and then decide. Depending on your tastes and what you already have, furniture/window treatments/linens, etc can be 50k+ easy.
Good luck and congrats on your business success! That's so exciting.
Last edited by hellob; 03-02-2017 at 02:20 PM..
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