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Well rates are VERY VERY favorable now and that does mean your monthly payment would be more "bang" but the lenders still like to see total housing costs under 36% of total income and that would mean you would need a downpayment of around $300K. That seems almost impossible to save up. Even if you could stash half of your gross pay that is ten years of savings (and who knows what rates will be in 2025!)
With your income you probably should shop something much closer to HALF of what you are currently thinking. Ideally if you save up $25-30K and get a place that needs some work but is in an area with mostly nicer home that are rising in value you can do some fixing up, sell it and pocket a BIG gain that helps you "climb the propety ladder" -- you put that gain into another home (maybe closer to $300K, that again needs some work but is still in a good area...) and even if your income does not go up then you are moving closer to the $500K without really increasing your outright need for saving up an enormous downpayment...
Our AGI is $70K.
We bought our house for $482K. Cash.
Taxes and maintenance and improvements are financially comfortable.
It must have taken a while to save $482k though. Where I want to move a lot of the cool houses are around 500k. I always wonder what those people do for a living. I'm sure not all of them have a 100k+ income!
It must have taken a while to save $482k though. Where I want to move a lot of the cool houses are around 500k. I always wonder what those people do for a living. I'm sure not all of them have a 100k+ income!
Probably need closer to 75k depending on property taxes. If they sold a home or condo and moved up, they probably had a nice chunk down payment, if two individual each had one property and both sold, I can easily see a down payment of over 20% if they bought either in the last two year, or over 15 years ago.
What do you all think? How long would it take and how big do you think the down payment should be?
At a 3X loan amount to income ratio you'd borrow $180K, meaning $320K down. This would take roughly 15 years if you save $15K per year and get decent growth (8% nominal or 5% real, assuming home price growth, income growth, and inflation are all about 3% annual).
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