How much income required for a nice SFR in OC (Anaheim: middle-class, fit in)

[k374]

Wanted to take a poll here on what the residents of OC think is the income required for a family in their early to late 30s with 2 kids to buy a mid sized SFR with the following basic requirements:

- Home is in good move in condition (no fixer uppers)

- Neighborhood is middle class but clean and safe with good schools

- Decent size for 4 people to live comfortably

Assumptions (going with the average family profile):

- This hypothetical family has average debt (According to statistical data the average american family has $9k credit card debt so let's go with that) - $9k cc debt, 2 average car loans ($300/mo ea. - $600/mo total), no other debts

- cash savings available for a downpayment: well, given the average savings rate of a typical middle class family I will let YOU be the judge as to how much such a family would expect to have saved up, assume they save in line with a typical family.

From this data I want you to work backwards, taking into account the neighborhood profile, debt profile, savings profile and come up with the price of a home that will MINIMALLY satisfy the requirements and what income will be required from the family to service the cost of the house.

[HarleyGuyOC]

Originally Posted by k374

Wanted to take a poll here on what the residents of OC think is the income required for a family in their early to late 30s with 2 kids to buy a mid sized SFR with the following basic requirements:

- Home is in good move in condition (no fixer uppers)

- Neighborhood is middle class but clean and safe with good schools

- Decent size for 4 people to live comfortably

Under America's New Economic 'Reality' you barely even need to have a job in order to 'buy' a house.

All you need to do is fill-out an FHA application, be willing to lie on all the info you provide (don't worry, they rarely verify) and approx. $18K in hard cash for a downpayment on a $600K property.

Unless of course you live in a city such as Anaheim, which has a program wherein they'll give you up to $125K for the downpayment. Then you won't even need to come-up with the downpayment ..all you'll need is the ability to fog a mirror whilst breathing heavily.

Now if you don't want to commit fraud in order to buy your new home, I suggest you rent, because everyone else around you certainly is willing to use taxpayer-backed loans to get into bidding wars over already outrageously over-priced houses on which they'll make 2 or 3 payments before deciding to squat & live rent-free for the next 3-5 years..

[EscapeCalifornia]

$150k

$200k when you want good schools.

[Coldjensens]

$150,000 to $200,000.

Of course that will vary with the size of the downpayment. Many people have a downpayment from the sale of a prior home or condo, not just from savings. Many people use an inheritance or help from relatives to come up with the downpayment. If you have a $200,000 down payment you can probably do it on $90,000 - $120,000 a year.

A lot depends on how you live. Do you fit into the frugal living threads on CD? Do you eat out and go to movies? Drive a car less than 10 years old? drink or smoke? Wear new bought brand names? All of those things will factor in to how much you need to make to buy a home.

When we sold our home, I could not have bought it from myself despite the fact that I was making $300K plus. It had increased in value around 500%. After we sold it, yearly property taxes wend from about $2000 to about $10,000. Our insurance policy was renewable, but no longer obtainable and a replacement policy would cost well over $1000 more per year. We ended up with a big downpayment for a replacement house because of the increase in value but realtor fees and other costs of selling ate up a considerable amount of that. We could have bought another house certianly, but we would have had a very hard time buying our old house. We certainly could not buy an equivalent house in a nicer area. We would have had to trade down to a smaller house.

We bought our first owned home in CA with $3,000. Borrowed part of the downpayment from relatives, and the owner carried back part of it. However I do not think you can do that anymore.

[bhcompy]

If you're PITI is 28% or less, you're okay.

[HarleyGuyOC]

@ k374: Sorry about the non-responsive rant that I posted up above! I'm currently in the process of trying to buy a home and the stress is killing me

OK, here's my real answer;

I think that a family in their early to late 30s with 2 kids that wants to buy a mid sized SFR in good condition (move-in) in a clean, safe middle-class OC neighborhood of decent size (2000 sq ft +or-) would need to earn a total household income of at least $110K (if you live relatively frugally) to around $150K (if you're a controlled spender) all the way up to $200K and even above if you aspire to the Lifestyles of the Rich & Famous. If it were just you and your wife it wouldn't be quite so expensive, but the 2 kids add a considerable cost to the equation.

Needless to say, you will need a reliable vehicle as well. Perhaps two if your significant other needs to commute. These vehicles -if financed- will require you to purchase expensive Comprehensive Full Coverage insurance. The city you choose to live in may have additional taxes that aren't called taxes but still are: Mellos Roos, HOA Fees ..and the fun is just beginning! At least one of you will need to have health insurance benefits thru the job, because otherwise you're potentially just one emergency-services medical bill away from bankruptcy. These are costs that need to be factored in. Good luck!

[leonard]

Originally Posted by EscapeCalifornia

$150k

$200k when you want good schools.

Right on

[CAVA1990]

B.S. You can a perfectly nice 3-4 br house in Mission Viejo for $300-400K. At today's interest rates you could definitely swing that on $100K.

[HarleyGuyOC]

Originally Posted by CAVA1990

B.S. You can a perfectly nice 3-4 br house in Mission Viejo for $300-400K. At today's interest rates you could definitely swing that on $100K.

You're absolutely right Cava!

But our friend here has two BHE's (Bottomless-Hole-Expenses) otherwise more popularly known as "children".

That's why he's screwed

[EscapeCalifornia]

Originally Posted by HarleyGuyOC

You're absolutely right Cava!

But our friend here has two BHE's (Bottomless-Hole-Expenses) otherwise more popularly known as "children".

That's why he's screwed

Plus two car loans and $9k in credit card debt. That debt service will certainly eat into one's mortgage allowance.