Job offer in SF....yes? no? hell no? (London: lender, homes)

[SageCats]

You do realize that if you and your significant other make $200K yearly and you came up with 10% or 20% down payment on a $1M home with a monthly mortgage of $6K or $5K and one of you loses his or her job, you won't be able to pay your mortgage, right?

Living paycheck to paycheck is not a good way to live. Living above your means isn't either. Make smart choices... and while I don't think Neutrino is trolling either, taking financial advice from someone in the bay area who makes $11/ hour and promotes the room mate lifestyle should be taken with a very fine grain of salt.

[Majami]

Originally Posted by SkySofiaLila

You do realize that if you and your significant other make $200K yearly and you came up with 10% or 20% down payment on a $1M home with a monthly mortgage of $6K or $5K and one of you loses his or her job, you won't be able to pay your mortgage, right?

200k job is roughly 16k a month, let's say after taxes in California it turns into 11k.

11k - 6k = 5k.

5k for living expenses is still doable.

[SageCats]

After taxes, $200K is $10K.
If one person loses his or her job, they would bring home half of that. $5K roughly. If your mortgage is $6K, you are SOL. If your mortgage is $5K, you can forego eating. That month.
Does that make sense?

[SageCats]

Not sure what was so unclear about my post...?

[smashystyle]

Originally Posted by SkySofiaLila

After taxes, $200K is $10K.
If one person loses his or her job, they would bring home half of that. $5K roughly. If your mortgage is $6K, you are SOL. If your mortgage is $5K, you can forego eating. That month.
Does that make sense?

After taxes, $200k is almost $11k/month for a married couple in SF with no itemized deductions. With a mortgage, income taxes are even less and take home pay higher.

But to the bigger point, of course you couldn't pay your mortgage if one of the two earners lost their job. That's true for most two-income families anywhere. It doesn't make a mortgage unaffordable. At best, you have an emergency fund with a few months' expenses so that you can tide things over until you can find a new job.

[neutrino78x]

Originally Posted by SkySofiaLila

You do realize that if you and your significant other make $200K yearly and you came up with 10% or 20% down payment on a $1M home with a monthly mortgage of $6K or $5K and one of you loses his or her job, you won't be able to pay your mortgage, right?

Of course, that is true whenever you buy a house.

Again, MANY people live here who make 11.25/hr, and under 90k. Those of us who make under the median share housing.

Those who make the median can buy a condo inside a building containing other condos.

Those who make 2x the median or more can buy a SFH.

Hopefully no one reading this thinks that people who make 20/hr commute to the Bay Area from Parump County, Nevada. Because I make 11.25/hr and I live here. And I am not living paycheck to paycheck. I have money in the bank.

[Lockdev]

Originally Posted by neutrino78x

Definitely not a troll. Unlike most who post on here,I actually grew up in the Bay Area. I didn't come from Kansas, get sticker shock and decide to move back. I'm actually FROM here. So to me, it is normal that you wouldn't he able to own a SFH on the median salary. That's been the case all my life (I'm 38). I know that this is a dense area and is one of the most desirable places in the world to live. Naturally any SFHs still existing would be very expensive.

Move to Scottsdale so you can own a house? What?!?

As far as roommates, hate to break it to people not FROM here, but that is the normal lifestyle in the Bay Area among people who make less than the median income for the area.

San Francisco is regarded as more iconic than San Jose mainly by residents of San Francisco. Silicon Valley is ALSO known throughout the world. Silicon Valley is one of the world's great centers of innovation.

Again, be careful of anything this guy says.

I wouldn't trust financial or life advice from a 38 year old that lives in the Bay Area and makes $11/hr unless that 38 year old had a couple million in the bank.

Honestly dude, if you're not a troll, you have no business giving anyone life, financial, or home buying advice.

[mrsltd]

Originally Posted by neutrino78x

You're supposed to be able to buy 5x what your income is, so if your combined income is 100k, you can get a 500k dwelling, and if you have at least 200k combined after taxes you should be able to buy a 1M home. Not that you need one, I mean you could buy a condo inside of a building containing other condos. That's middle class in the Bay Area.



Yes, but in Austin, you still can't buy the most expensive form of housing using the median income. Logically, you would have to have the highest income to buy the most expensive housing.

All the CoL difference means is that middle class in Austin might be an actual SFH, as opposed to the Bay Area, where middle class is a condo inside of a building containing other condos.

Thought it was you could BORROW up to three times your income, and assuming 20% down on a house, you would be able to buy 3.75x what your income is.

5x seems quite steep and a big burden.

[mrsltd]

Originally Posted by neutrino78x

Yeah OP, 90k should be fine around here. That's close to the median income for the area. I think the median in SF is actually a little lower. If by chance you can't afford an apartment to yourself, you can always move in with roommates.

I don't think anyone is priced out of the market here, really. If you make the median income -- 100k for Silicon Valley, 78k in SF -- you can buy a condo, if you want. If you want the most expensive form of housing in the area -- a SFH in an excellent school district -- you would either make 200k (after taxes) by yourself or get together with someone else who makes 100k and combine incomes. If you cannot afford a SFH in an excellent district in the Bay Area, you're not priced out, you just have to get something smaller. That is to say, a condo. You can still live here. You just won't own the land underneath your house, and you probably won't own the whole building in which you live, just the part you bought. But if in 30 years you own it free and clear, that's living in the Bay Area, is it not?

The complainers forget about those of us who make far less than the median and still live here. We share housing. Take me for example. I just did my taxes. I have my W-2 here. It says I made (approximately) 16k. And I live here in Silicon Valley. So if you (referring to the complainers) made 160k, I don't know how you're "not making it" if I can do it on 1/10 what you make. Perhaps you bit off more than you can chew in terms of housing.

If you are paying more than 1/3 of your income after taxes on housing, then you need to downsize.

I share a one bedroom apartment with my dad; I had to move back when De Anza College didn't have the right courses in summer 2014 so I didn't have the GI Bill funding. I'd move back to downtown -- I can afford to do so -- but then I couldn't keep helping him with his rent; he pays 1300/month. So yeah I'm making it, I have 1500 in the bank. But I'm looking for a better job so I can afford my own room and still send him at least the same amount (if not more). He's only going to need more help from me as he gets older. That's the circle of life, they say.

I'm interested in either IT or the Merchant Marine, as far as better jobs.

11.25 an hour would translate to 23.4k per year, yet you only made 16k last year. Are you part time or just not checking your arithmetic?

[mrsltd]

Originally Posted by neutrino78x

Well, you're right, I misspoke. 3x not 5x. Mortgage payment should be 1/3 of your income after taxes. But you see my point. 200k should be enough to buy a house that is approximately 1 million. If it is significantly more, you need a higher income.



Yeah but then you have to live in Austin. Again, I'll take a condo in New York City, San Jose or San Francisco over a SFH in Austin ANY DAY OF THE WEEK.

There's a reason why those of us from The Great Cities refer to places like Texas as Flyover States.

Not that I know Texas very well apart from reputation and other people's experiences of it, but that last statement was nauseating. Smacks of snobbery. Sounds very strange coming from someone who earns, AT BEST, less than 25K annually. If you're going to have the attitude, AT LEAST have something to show for it.
Just dwelling in a coastal state with great weather, in a "great city", is no measure of anything worthy of credit.

Also, you "misspoke" but then you went right back to your insistence that a 200K income is enough for one to buy a million-dollar home. WTH?

AT BEST, 750K according to the formula outlined above. Granted, that may not get you a dream house in the Bay Area, but better to settle and re-group than to borrow yourself into bankruptcy.