Need advice (somewhat unusual financial situation) (insurance, loans, 401k, 2013)

[anchors aweigh]

Hi everybody,

(tl;dr at bottom)

Prospective first-time buyer here. I'm looking to buy on Long Island (aka absurdly high real estate costs and taxes) and am wondering if I'm making good progress or should just abandon this dream.

Basically my situation looks like this: I'm currently working about 60 hours a week at 3 PT jobs while awaiting a FT one in my field (lots of competition). It's civil service however, and I have a decent shot due to a good score on the list if I just wait around long enough. My take-home after taxes and funneling money into various retirement accounts (7.5% to a 401k on one paycheck and 25% to a deferred compensation plan on another, so have some wiggle room here in case of emergency) is roughly $35,000 a year, give or take. This is OK pay in other parts of the country but makes me borderline poverty-level on Long Island. One job I've been at for 9 years, one for 3 years, and one for only a few months.

I'm 31, have no kids, single. Two cats with health problems but we're talking only a couple hundred in vet expenses every few months. Student loans completely paid off. Car is 9 years old but completely paid off. Credit card paid in full each month. Living at home currently to save, paying small amount of rent, but that gravy train will be ending in the next year or two when my mom sells the house. My credit score, last I checked, was over 800.

I live a very bare-bones lifestyle in an effort to minimize expenses. Aside from having a smartphone ($60/mo), a car, pets, and a trip with friends to my favorite pizza place a couple times a month, I have literally next to no other expenses I can avoid. I even try to save on gas when driving by not using the heat or AC unless I can't take it anymore.

With all of this saving I've built up about $42K so far in my savings account to use as a down payment. I'm currently saving at a rate of about $20K per year, unless something horrific happens.

I am looking at local studio or 1br co-ops with a price range of $100-140K. Monthly maintenance, which includes taxes and usually heat and/or water but not electricity, runs from $400-700 in the places I've been looking. I own some furniture but will still need to buy some more, and I understand in NY I should budget around $5K for closing costs. I also think I should leave myself a cushion for repairs or unexpected moving expenses, and absent any better advice I would like to budget about $5K for that. All of these things will cut into what I can put down. I would be looking to move anytime between 6 months to 2 years from now, depending on my mom's moving timetable.

tl;dr
Low income in a high-COL area; expenses already cut close to the bone
Looking to buy in $100-140K range
No debt, super-prime credit, significant down payment

So my questions are: will I qualify for a mortgage with my pathetic income/lack of FT employment, even though I have flawless credit, no debt, and a down payment that will be over 20%? Do you have any other advice for me based on my situation? What can I be doing better, or have I already maximized all of the steps I can take? I am very determined to buy a place of my own in spite of the daunting odds, but I am also equally determined to not make a huge mistake and get in over my head!
Relatedly, would I be better off renting (average rent I've seen is $1100-1200 with all utilities included)? My end game is to move into a town I've fallen in love with that has condos selling for around $275-315K, so the co-ops I'm looking at now are a stepping stone. Obviously a place that expensive will have to come much later and I will have to save for a long time to pull it off. I don't imagine I will be able to afford one of those condos within the next 5 years without either a huge salary increase or a partner to move in with, and neither looks likely in the near future, unfortunately.

Thanks so much for any advice you can spare, and sorry for the long post!

[Pfhtex]

You can only use the 9 year and 3 year jobs.

Average the income across 2012 and 2013 and YTD. Count the hours, not the money. If you made more in 2013 than 2012 from each job, that's a good thing. Gaps are not good. For the actual income calculation, it would be optimal to average the most recent 24 months for those two jobs. Again, the hours, not the dollars. Gross, pre-tax.

That is your income number.

Liabilities: Credit report numbers, not utilities. Plus the projected house payment, including property taxes, insurance and HOA.

The monthly Income number should be MORE than twice the total liabilities number.
'
There is a lot more to it than this, but in the absence of the data detailed above, that's your starting point.

[Modification Specialist]

You sound like a work-o-holic, getting a place off the LIE might be better suited to your commuting schedule. Where do you work, ideally having a job closer to with you live will reduce expenses.

Buying a Condo

• $10000 = Purchase price
• $20000 = 20% down payment
• $80000 = Finance amount
• $405 = payment $80k/4.5%/30yr < (this is not including mortgage taxes)
• $24300 = amount paid in five years
• $72926 = five years mortgage balance

• Your neighbors are a wall away (reduced privacy)
• Low physical maintenance
• Limited to any phyisical upgrades
• When you sell how much will you have to reduce the price to attract buyers.

Because condo's are part of a comunity with simular propertys (with the same value). A condo is harder to sell for any profit unless you live there for a very long time. When selling many condo owners have to reduce their selling price.

Compearing purchasing a house

• $10000 = Purchase price
• $20000 = 20% down payment
• $80000 = Finance amount
• $405 = payment $80k/4.5%/30yr < (this is not including mortgage taxes or HO Insurance)
• $24300 = amount paid in five years
• $72926 = five years mortgage balance

• Neighbors are a yard away (more privacy)
• More maintenance
• Any physical upgrades can only add the the value
• Profit is easier to be retained when you sell

Years ago getting a condo was thought to be a good investment. Now the only way I would condone moving into a condo would be renting. Noting your busy schedule - it might be a good idea because of the low physical maintenance.

.

[anchors aweigh]

Modification Specialist,

Thank you for your advice. It would probably be helpful somewhere else in the country, but it certainly does not apply to someone in my situation on Long Island. There is absolutely no way I could responsibly buy a house anytime soon -- the only way I see this as being achievable is if I had a partner or if my mom didn't sell the house for another 10 years and I accumulated a down payment of like 75%.

Crappy starter houses in my county -- often in unsafe neighborhoods -- go for at least $300K. Property taxes will be north of $10K on nearly all of them. And, as you said, maintenance and upkeep will be a burden. (I am not handy at all.) I could leave my county for less expensive starter homes ($250Kish, similar taxes), but that poses significant problems in terms of civil service, not to mention my commute.

It is my dream to someday own a house, but unless I get married to someone who probably makes twice as much as I do, I simply do not think that will ever be possible. I feel that owning one of those condos is a much more realistic goal that I still have a chance of actually achieving prior to being 80 years old.