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The reason these areas on the list because of volume, one zip code moving several deals for $250-400k rather than the random single fam homes in well to do areas. These new condos have 15-30 units per building. The bottomline is price, location, and distance to mass transit. These are the factors for new buyers.
Anyone would love to move to desirable areas but NJ and NYC has a big problem. Affordability.
A $500k home can only be possible for folks who have dual six figure incomes with no student loan debt. With student loan debt and dual six figure incomes, it would take atleast 5-10 years for a couple to pay down the debt enough to jump into market. Some couples who make around $300k are the ones going for $500k homes.
For the rest, just like during the recession the $300k price seems to be the median price tag for middle class buyers.
Cmon that's a little conservative. 300k dual income debt free doesn't average out to a 500k home. I'd say it's closer to double that. 700-1mm
Using a banks 28% methodology on gross income of 300k, that's 7k/mo towards mortgage insurance and tax.Being conservative at 20%, that's 5k/mo. Assume 20k yr tax, 25% down, 100/mo insurance, that leaves you with 3233/mo mortgage, which is a 675k mortgage, 4% rate, 75% LTV, 900k house.
Using a banks 28% methodology on gross income of 300k, that's 7k/mo towards mortgage insurance and tax.Being conservative at 20%, that's 5k/mo. Assume 20k yr tax, 25% down, 100/mo insurance, that leaves you with 3233/mo mortgage, which is a 675k mortgage, 4% rate, 75% LTV, 900k house.
Assuming $300k income, the gross income after Fed + state income taxes will leave you with $192k
After tax monthly income is $16k, $5-7k monthly mortgage isn't unheard of but it is pushing it. That's over 20% of your net income.
If your accountant can't outperform TurboTax, and you have zero pretax investment contributions, then yes. But realistically the monthly freedoms are higher.
I think the argument is moreso that the average new homeowner of a 500k house is likely pulling in way less than 300k, yes?
If your accountant can't outperform TurboTax, and you have zero pretax investment contributions, then yes. But realistically the monthly freedoms are higher.
I think the argument is moreso that the average new homeowner of a 500k house is likely pulling in way less than 300k, yes?
Agree with this. Some of the posters here seem to think that on. A 500k house you need to make 300k a year which is great if do it but more than a bit overly conservative. While there are exceptions and some people chose to live way below thier means most 300k salary people I know are going 700 to 900k.
People, this is the star ledger. Some Head Writer (i.e. intern) downloaded some numbers, had no idea what they really represented, sorted them in excel and made a story. Simple as that. This list is useless
If your accountant can't outperform TurboTax, and you have zero pretax investment contributions, then yes. But realistically the monthly freedoms are higher.
I think the argument is moreso that the average new homeowner of a 500k house is likely pulling in way less than 300k, yes?
I don't think pulling in 300k is that difficult these days for a couple, provided they've paid down their debts enough for lenders to approve. A lot of young folks are taking in $200k+ but owes over $200k in student loan debts couple with bad financial decisions they don't have enough cash for that 20% down. Most home buyers I've seen lately in NJ are in their mid to late 30s - 40s. I bought my 1st home when I was 29, these days very few home the finances in their 20s to do so.
Agree with this. Some of the posters here seem to think that on. A 500k house you need to make 300k a year which is great if do it but more than a bit overly conservative. While there are exceptions and some people chose to live way below thier means most 300k salary people I know are going 700 to 900k.
I get it, but to me thats insane. What if you have a jobloss, illness etc. I dont see why people overextend themselves. Does anyone really need a 900k home?
I get it, but to me thats insane. What if you have a jobloss, illness etc. I dont see why people overextend themselves. Does anyone really need a 900k home?
I think many people think 900k is often some outrageously sized home. Not always the case. If you are in the perfect town, near transportation to the city, walkable, 900k may end up being 4 bedroom 2 bath house with an ok yard or it could be a 2br 1 bath apartment with amenities. And people pay it because the commute is easy and adds to their work life balance. Others priorities other things and buy accordingly. Not saying i would or wouldnt drop 900k on a home. Just explaining why people do.
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