Buying a half a million dollars home on single income?
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I am a single father. Should I buy a 3 bed room townhouse for $500k? HOA is $250 a month. I have zero debt, no alimony or child support payment and my 3 year old daughter goes to daycare for $800 a month until kindergarten. My income is $115k, with about $6k monthly take home after tax and 401k contribution. I have $200k cash and plan to put down a 25% for down payment. Property tax is 1.1%. Am I stretching?
I live in OC, CA and home price is crazy here. Of the $6k take home, $2.5k goes to housing with tax, Hoa, and mortgage payment.
I will buy a house, but not the townhouse with a $250 HOA. I will buy a 3-bedroom single family fixer, no HOA, fix it up myself and rent out a room for rental income. That way, I will save $250 & make $500 per month (that's $750 in saving).
Townhouse is not a good wealth builder. Keep looking, fixers are out there. Have your downpayment ready and pull the trigger asap when it arise.
I will buy a house, but not the townhouse with a $250 HOA. I will buy a 3-bedroom single family fixer, no HOA, fix it up myself and rent out a room for rental income. That way, I will save $250 & make $500 per month (that's $750 in saving).
Townhouse is not a good wealth builder. Keep looking, fixers are out there. Have your downpayment ready and pull the trigger asap when it arise.
Your opinion about townhouses and not being a wealth builder is just that, your opinion. There are areas where townhomes appreciate just as well. Absolutes here don't apply
Your opinion about townhouses and not being a wealth builder is just that, your opinion. There are areas where townhomes appreciate just as well. Absolutes here don't apply
Also, if townhomes appreciate (say) 2% less than detached SFH, in 100 years they will be worth only 14% as much in relation to SFH (i.e. the price ratio will go down to to 14% of what it is now). This seems implausible, since the fundamental shelter value would then be way out of line with the price.
At least if the appreciation rates differ much, it is a temporary trend, not a permanent one. Of course you can argue that we won't be alive in 100 years and it's irrelevant, but this misses the point that, given that the trend must reverse at some point, why think the near future is a less likely time for reversal than any other?
The good life and financial peace isn't the acquisition of stuff or in this case a big house. It's learning to live on less than you make. You live once, time is important, don't waste your young years and time that could be spent with your family, your child, doing things you like to do because you have to work all the time to support your stuff. Times may be good now but the rainy day always comes, make sure you are ready to go through it with peace.
Just my humble opinion (from someone who's a little older and knows the importance of family, time, financial freedom and financial peace). A humble opinion from someone who has seen other people in similar positions early on only to be caught in the rat trap and are miserable because they had to have the best stuff.
Live life, don't set yourself up for financial stress or to have to work your life away. It always looks better on paper but life happens, don't get caught in the trap of stretching yourself (there's always unexpected expenses) don't get caught in the trap of living above your means.
You have a great start, don't blow it, who wants to work till your so old that you can't do anything. Wouldn't a smaller house (less money), early retirement with vacations, relaxation, time with family be better?
Good news. I am getting a 10% raise which takes my income to ~$127k. I think now I can definitely afford a $500K-$520K home with 25% down payment. I am leaning toward a small SF house in Cypress right now. These homes are typically 1100 sq ft. My take home will be approximately $7k/month and mortgage payment and taxes is roughly $2.5k. My daughter goes to preschool for another 1.5 years before going to public school. Currently it cost me $800 a month for preschool. After that it will be a little easier.
Good news. I am getting a 10% raise which takes my income to ~$127k. I think now I can definitely afford a $500K-$520K home with 25% down payment. I am leaning toward a small SF house in Cypress right now. These homes are typically 1100 sq ft. My take home will be approximately $7k/month and mortgage payment and taxes is roughly $2.5k. My daughter goes to preschool for another 1.5 years before going to public school. Currently it cost me $800 a month for preschool. After that it will be a little easier.
Good news. I am getting a 10% raise which takes my income to ~$127k. I think now I can definitely afford a $500K-$520K home with 25% down payment. I am leaning toward a small SF house in Cypress right now. These homes are typically 1100 sq ft. My take home will be approximately $7k/month and mortgage payment and taxes is roughly $2.5k. My daughter goes to preschool for another 1.5 years before going to public school. Currently it cost me $800 a month for preschool. After that it will be a little easier.
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