Is $170K really not enough? (San Diego, Huntington Beach: credit, lawyer, relocation)

[drowningintherain]

Originally Posted by Mach50

Is it wrong for people to love the life in California and warrant paying the prices based on their enjoyment of living here?

I for one would never consider living in Texas no matter the size of the estate I could trade for, no way.
Texas simply does not have anything to offer for me and that goes for about 47 other states too.



See this is the problem, you want a 92" screen TV and a 3350 sq ft house, I will gladly not own a TV and live in a 2000sq ft house 15 miles from the beach and 5 miles to Mountain Biking, Hiking, with no bugs, no humidity and moderate people who don't bother me to join the local church everyday.

Please stop with your negativity and bashing on California.

The example article your posted, proves to me that people want more than they can afford and are silly for taking loans they could not handle.

I couldn't agree more! You would have to pay me to live in Texas. I would much rather live in a townhouse in Southern California then a mansion in Texas. I did consider it for a while, talked to a nurse recruiter then went down there for a visit. I hated it. I'm sure there are nice things about Texas, but for someone from a beautiful progressive city (Vancouver, B.C) it seemed like hell.

[cobmw]

What is $170K after California's stiff, progressive tax rate? Lets see, $170K is $15K/mo. That's about $10K/mo after taxes? (help anyone?) Now if you have the smarts to earn $170K/yr you are probably used to a fairly good lifestyle. So lets shop for a house. In any good neighborhood in Irvine, Laguna Hills, Tustin, etc, expect to pay $1mil to $1.5mil. Lets use $1.25mil. With $250K down (20%) that will give you a mortagage of $6000/mo. Add $1000/mo for property taxes and $750/mo for pool upkeep and utilites (electrical rates are steeply progressive in CA - water also?). That leaves you around $2K/mo to live on. Forget about sending Johnny to a private school to avoid the terrible California school system.

I know that I'm going to get slammed by those who say that they don't know of anyone who lives like this. I know lots of people who live like this. We did. The $1.25 mil house is not a mansion. Just a nice house in a nice south Orange County area. Taxes eat up much of the rest. You'll find the same thing happens to you if you ever get to this level.

[cobmw]

Charles

I like your method of calculating what they can afford. Too many people probably use my method and wind up in foreclosure.

[YLresident]

Originally Posted by cobmw

What is $170K after California's stiff, progressive tax rate? Lets see, $170K is $15K/mo. That's about $10K/mo after taxes? (help anyone?) Now if you have the smarts to earn $170K/yr you are probably used to a fairly good lifestyle. So lets shop for a house. In any good neighborhood in Irvine, Laguna Hills, Tustin, etc, expect to pay $1mil to $1.5mil. Lets use $1.25mil. With $250K down (20%) that will give you a mortagage of $6000/mo. Add $1000/mo for property taxes and $750/mo for pool upkeep and utilites (electrical rates are steeply progressive in CA - water also?). That leaves you around $2K/mo to live on. Forget about sending Johnny to a private school to avoid the terrible California school system.

I know that I'm going to get slammed by those who say that they don't know of anyone who lives like this. I know lots of people who live like this. We did. The $1.25 mil house is not a mansion. Just a nice house in a nice south Orange County area. Taxes eat up much of the rest. You'll find the same thing happens to you if you ever get to this level.

Then you lived beyond your means... live in a smaller house, have a smaller pool or noe at all, a smaller yard, choose your school district wisely, and buy a better comforter and ceiling fan.

Oh, and sell the 5 gas-guzzling SUV's and/or V-12 luxury sedans/sportcars.

All those extra expenditures are choices you (and other OC "Coto"-types, I'm sure) made yourselves and not necessary to live well and happy. Exercising some moderation can be a good thing. Eesh.

[goozer]

Originally Posted by savannah11

My husband and I, along with our 9 month old baby, are relocating from Houston to Huntington Beach next month. Together we will be making a combined $170K. It frightens me when I read on here that some people make this amount of money and still struggle to get by. Is it really not enough?

Let me say that we have no illusions of owning a home. I don't live by the philosophy that renting = bad, buying = good. We are renting here in Houston and while home ownership would be nice some day, I'm in no real hurry. We also do not have the expectation of settling in OC forever. I told my husband we'll give it a two year trial period. I know we'll be paying around $2500 to rent and $1000 in daycare but that is a manageable amount for us. What other costs are there that could make us struggle?

You sound like you will be in great shape with that salary and a willingness to rent for a couple of years. I also imagine you will find some great deals on houses in two years when the housing bubble starts to bottom out.

[EscapeCalifornia]

Originally Posted by YLresident

Then you lived beyond your means... live in a smaller house, have a smaller pool or noe at all, a smaller yard, choose your school district wisely, and buy a better comforter and ceiling fan.

Oh, and sell the 5 gas-guzzling SUV's and/or V-12 luxury sedans/sportcars.

All those extra expenditures are choices you (and other OC "Coto"-types, I'm sure) made yourselves and not necessary to live well and happy. Exercising some moderation can be a good thing. Eesh.

I don't have any of that crap and I can tell you that a $500k+ mortgage isn't any fun on two above average incomes. I have the smallest house on the block and a 5 year old car. I don't run the heat at night and don't even have AC. Downsizing means an apartment or another state.

[Charles]

Let's crank a few numbers.

Assume $120K down payment (big and very generous assumption, the original poster didn't provide this information)
Six percent fixed, 30 year
Annual property taxes $7000
Annual insurance $1000
With $170K Gross, a person can afford something around $670K to $750K

Also remember the original poster quoted a combined income of $170K. That means they both have to continue to work. What if more kids come along? What if one loses his job? What about 401(k)s/ Roth IRAs? Education IRAs? Another car in five years?

How often will a dual income couple go to the beach? What will the commutes be like? How will the commutes affect their evening strength? Their health? Their marriage? The average Southern Californian is outdoors 17 minutes per day during the week and 41 minutes per day on the weekends. Most of the time, most (not all) married people are doing basically the same things Earl and Mable are doing in Iowa: driving to/from work, shopping, errands, working, cooking, cleaning, paying bills, caring for junior, driving to kids activities, going to libraries, dealing with car repairs, working around the house, posting on City-Data, watching DVDs and TV and the news, reading the newspaper, researching a purchase, etc.

Each person can decide if this is worth it.

Here's what you get in Huntington Beach for the prices listed.

$670K, 1240 square feet (not a typo)


$669K, 1392 square feet


$700K, 1200 square feet (but it is three blocks from the beach)


$714K, 1100 square feet (not close to the beach)

[cobmw]

YLresident

You misunderstand. I'm not whinning about my ability to live the California lifestyle. I afforded it (but I make a great deal more than the $170K these folks are bringing in). I'm just trying to get these folks to look at the math. Don't expect to come to CA on $170K/year and live a lush lifestyle. You'll have to be careful with your money and you won't get much of a house. When I said that I did it myself I simply meant to say it's not unusual to go through that kind of money in California and still not have much to show for it.

[JakeDog]

Originally Posted by cobmw

What is $170K after California's stiff, progressive tax rate? Lets see, $170K is $15K/mo. That's about $10K/mo after taxes? (help anyone?) Now if you have the smarts to earn $170K/yr you are probably used to a fairly good lifestyle. So lets shop for a house. In any good neighborhood in Irvine, Laguna Hills, Tustin, etc, expect to pay $1mil to $1.5mil. Lets use $1.25mil. With $250K down (20%) that will give you a mortagage of $6000/mo. Add $1000/mo for property taxes and $750/mo for pool upkeep and utilites (electrical rates are steeply progressive in CA - water also?). That leaves you around $2K/mo to live on. Forget about sending Johnny to a private school to avoid the terrible California school system.

I know that I'm going to get slammed by those who say that they don't know of anyone who lives like this. I know lots of people who live like this. We did. The $1.25 mil house is not a mansion. Just a nice house in a nice south Orange County area. Taxes eat up much of the rest. You'll find the same thing happens to you if you ever get to this level.

You really need to look closer at the housing market. There are lots of GOOD houses around 1800 square feet that can be had for $500K in top areas with great schools. 1.25 Million? No one making $170K who isn't insane would even consider that. This is the most ridiculous thing I have ever read. One Millon gets you a 3000 square foot house in a top notch area- but I wouldn't recommend buying that much house unless you can afford it. Don't believe me? Do a search on Realtor.com or craiglist or just go house shopping in Orange County. You can get a decent family home in the 500s, a nice home in the 600s and 700s and a home that you wouldn't ever have to move out of no matter how many kids you have in the 800s. People play sour grapes on these forums a lot to convince themselves they are making the right decision in moving to a third world state like Texas. They are not. Don't be fooled by the negative hype.

[JakeDog]

Originally Posted by EscapeCalifornia

I don't have any of that crap and I can tell you that a $500k+ mortgage isn't any fun on two above average incomes. I have the smallest house on the block and a 5 year old car. I don't run the heat at night and don't even have AC. Downsizing means an apartment or another state.

Define above average income and state how large your mortgage is (and whether it was adjustable). Sorry, but a lot of people bought more than they could afford and now are playing sour grapes. Compared to SF, NY, Boston, and LA, Orange County is relatively cheap. In terms of comprable neighborhoods, it is actually more on a par with Seattle and Portland (when I say comparable I mean similar areas with good schools, of course you can post a bunch of cookie cutter homes in Portland that are in bad school districts, but that is misleading). It is actually a very good time to be moving to OC or San Diego so long as you bid very low or buy a foreclosed home. It is a bad time to be selling or to be in a situation where you bought too much home for your income.