Can I afford a home?

[sundaze]

Trinston, in addition to the issue of what you can afford, consider that a lot of people end up not liking their first job. You might want to take something different, or go back to school, or any number of things. At your age the last thing you need is to tie yourself down with a mortgage. You will be fine in an apartment, don't even think about buying until you are SURE you want to stay in a place for 5 years. Even then, I don't think it is a bad idea to rent. A house is a lot of work for a single person, and a condo is not really likely to be a good investment. Good luck to you.

[TimJ]

Hi Trinston,

Owning a home is a little more complex than renting, but it does give you some benefits that renting doesn't. You can change it to the way you want, you are building equity with your payments, you gain a tax write-off and hopefully your home will increase in value too. Even a 3-4% increase in home value can be huge. Don't think of it as the same 3-4% interest you get on your savings account. In your savings account you are gaining interest on only the money you have invested, but in the home you gain the percentage on the ENTIRE home value, which can be several hundred thousand dollars!

As far as what you can afford...only you can determine that. A mortgage loan officer can help you determine what you qualify for, but don't mistake that for what you can afford. That is left up to you.

Based off your salary increase to $52k I would estimate you would qualify for a total payment of around $1900-$2150 assuming you really carry no debt.

TimJ

[balto charlie]

Roomates for the first few years then when your salary goes up, kick 'em out. Benefits with roomates: someone to care for the place while on vacation. Also tax breaks will lower the actual cost so you'll be able to spend more than you first think. C