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Estimated median household income for Virginia Beach in 2005:
$58,545
Estimated median house/condo value for Virginia Beach in 2005:
$231,400
Now, I've been doing my research, and you're not supposed to go over 2.5 times your yearly income as far as housing goes.. so with the housing prices, if you're going to buy the average priced house, you'd have to make 100K - almost double the actual median income.
And people wonder why some people will get subprime mortgages. I have noticed though that prices are starting to go down a bit...
So, it comes down to my final statement/question:
I'm young. I make decent money. I'm looking at buying a house in either 2008 (around May) or in 2009. What are some suggestions when looking at mortgages? I was looking this year, but I got rejected (for the amount of 2.5x my income) due to some issues (lousy ex creating CC's) and some broker even stated that he wouldn't even consider a mortgage for a young person like myself.
Oh, my credit score should be good (I'll know at the beginning of the year) since I've finished paying off two vehicles this year.
I'd try to stay within 3x your income for the mortgage amount. But it helps if you'll also have a cushion (beyond that) for any repairs/emergencies. That way if something happens you're not putting it on credit cards right away, upping your monthly obligations.
My husband and I are building a house, mortgaging right at 2.5x our combined salaries, which is about 3.2x my salary alone. We have budgeted and while we won't have a lot left over for vacations or other excitement, we will be able to afford the house, the utilities, food/gas, cars, insurance, student loans, and taxes. So, we'll just vacation in our house for a while!
Try not to get into the "funny money" range (5x, 7x) - I'd stick with a condo or townhome at first if you can't afford single family in the area.
Make sure you get your credit cleaned up (weird ex-items taken care of)
I grew up in Virginia Beach and it has become a relatively expensive place to live in a short amount of time. My mom moved into a town home that was worth about 80k when she moved in. I told her to buy it but she didn't and now it is appraised at almost 200k.
My suggestion would be to either join a credit union, they have the best rates, or to establish a relationship with a locally owned bank so they know who you are. Your local newspaper should publish a weekly list of mortgage's bank rates. Learn how to read them. I've never used a mortgage broker. A bank will generally charge more upfront in fees if they're going to sell the mortgage as opposed to holding it in-house. You can ask them whether they sell or keep them.
I use to tell people not to go out further than 20 yrs on a mortgage, 15 if they could so that they'd be paying less in interest and have it paid off sooner, possibly by the time their kids hit college age. Nowdays with such high prices I guess I'd have to bump that up to 30yrs.
Your credit ratio should look better having paid off those cars. Buy something you can afford. Hopefully, housing prices will come down to a more reasonable ratio to income in the next two years.
I'd stick with a condo or townhome at first if you can't afford single family in the area.
My father's townhouse is appraised at $200K (not exactly best area, either). I hate townhouses. It's like a large apartment you buy. No yard, so crowded... and all townhouses are in HOA's. I despise HOA's. Condos are normal size apartments you buy.. with the same problems.
Single family homes are around $250K+
I don't need a McMansion, just a 2 or 3 bedroom ranch. I'm not into the 'fancies'.
Quote:
Hopefully, housing prices will come down to a more reasonable ratio to income in the next two years.
I've actually seen some houses drop into the 180's as of recently. I'm hoping they drop even more. Not to go into my finances, but the less I pay on a house, the more money I can save for retirement.
As for my daughter's college - she's on her own. I'm doing it myself, so can she.
My father's townhouse is appraised at $200K (not exactly best area, either). I hate townhouses. It's like a large apartment you buy. No yard, so crowded... and all townhouses are in HOA's. I despise HOA's. Condos are normal size apartments you buy.. with the same problems.
Not all town homes are like you described.In the mid 80's we had a 1700 sq ft town home attached to one other. We had two stories 3 bed rms 2.5 baths, 2 car garage and a great fenced in back yard not big but it was about 60x100.Hoa fees were $30 a month (no pools or clubhouse and they only maintained the front yard we did the back). I loved that home out of all the homes we have had. I would buy it back right now but it is worth $600,000 now.Only in CA outragious. We paid $150,000 for it.
Estimated median household income for Virginia Beach in 2005:
$58,545
Estimated median house/condo value for Virginia Beach in 2005:
$231,400
Now, I've been doing my research, and you're not supposed to go over 2.5 times your yearly income as far as housing goes.. so with the housing prices, if you're going to buy the average priced house, you'd have to make 100K - almost double the actual median income.
And people wonder why some people will get subprime mortgages. I have noticed though that prices are starting to go down a bit...
So, it comes down to my final statement/question:
I'm young. I make decent money. I'm looking at buying a house in either 2008 (around May) or in 2009. What are some suggestions when looking at mortgages? I was looking this year, but I got rejected (for the amount of 2.5x my income) due to some issues (lousy ex creating CC's) and some broker even stated that he wouldn't even consider a mortgage for a young person like myself.
Oh, my credit score should be good (I'll know at the beginning of the year) since I've finished paying off two vehicles this year.
Sad thing is, there are MANY other places where the ration of median home price to median household income is worse than the 5-1 spread in Virginia Beach. The spread is over 10-1 in many coastal California communities. I seem to recall that La Jolla has a median home price well in excess of one million dollars, yet the median household income is something like $70k or $80k. Ridiculous.
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I'm doing it myself, so can she.
