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Old 07-08-2008, 02:07 PM
 
Location: WA
4,242 posts, read 8,760,686 times
Reputation: 2375

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Citygirl, if you're selling a house for $300,000 in Greenlake, I'd so buy it.
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Old 07-08-2008, 05:06 PM
 
28,110 posts, read 63,531,084 times
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Quote:
Originally Posted by sean98125 View Post
One buys a home in Seattle by either doing well in investments and windfalls or by sacrificing for a couple of years to save up enough of a down payment to be able to buy the house that you want in the neighborhood that you like.

Decide what is more important to you - the luxuries that you have that cost you money every month, or being a home owner in a community that you love. My wife started making very good money after her postdoc ended, but we kept living like grad students for several years because we wanted to buy a house.

Set your sights on a long term goal and work toward it, and realize that every $4 cup of coffee, every dinner out, every expensive vacation, and every car payment you make is keeping you from achieving that goal.
Exactly... For most of us it is setting a goal and making sacrifices along the way to be able to put down at least 20% or more...

It's truly amazing how much one can save by limiting meals out, smoking and drinking... either alcohol and coffee...
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Old 07-08-2008, 09:24 PM
 
20 posts, read 55,274 times
Reputation: 12
It's amazing how people on this board don't address reality. Making assumptions that I drink coffee or alcohol, smoke is untrue. My significant other and I don't eat out more than twice a week also, and not at anyplace fancy. Only "sin" that I commit is eating out for lunch, which I ration to $6 meal.

It's true that I would like to live in Denver, but unfortunately good jobs in that area aren't that plentiful. Been looking for a while. So here I am...

But let's get down to numbers... these aren't my numbers, but are approximate.

Salary: 112,000
401k: Maximum %
Roth IRA: 600/mo
-----------------
Net Monthly: ~4800
Cash on hand: 80,000

Plugging in these numbers give me a house affordability of 440k with a 2700/mo payment including insurance and taxes. That gives me 1900/mo for savings, living etc. For 2 people, gas + bills + food is approx 1000/mo.

1. 440k is the high range for us. And still it is difficult to buy anything nice in the areas I indicated. We definitely don't want to spend that much. More like 400k max.
2. Spending the whole 80,000 is not a good idea
3. 1000/mo buffer is relatively slim and makes me feel uncomfortable

Having 80,000 on hand may not be much, but it's not trivial either. I'm 30 years old and feeling a bit helpless here.

Anybody else in this situation with some suggestions? I don't want to live like a pauper. It is perfectly fair to sacrifice to save for the future, but at the same time it is a balance.
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Old 07-08-2008, 09:42 PM
 
9,618 posts, read 27,287,468 times
Reputation: 5382
OK SB Dude, here are some questions for you:

1. Do you feel it is necessary or wise to buy a home in Seattle right now? Many people are happy renting. I know someone who rents a million dollar home on Mercer Island for 2500 dollars per month. Right now the sales price to rent ratio is out of whack, which suggests that prices will come down, or rents will go up, or both. Some people rent and put additional money aside for a larger down payment.
2. Are you willing to flexible regarding location, are you willing to explore new neighborhoods? There are lots of nice, safe, fun neighborhoods in Seattle that are not Wallingford or Greenlake but are considerably less expensive.
3. If the Greenlake, Wallingford, etc. location is non negotiable, are you willing to reduce your 401 k contribution to have more money to live on?
4. What are you looking for in terms of home size, yard size, SFR vs condo, etc?
Certain neighborhoods in Seattle remain inexplicably insanely overpriced, but there are nice houses in nice neighborhoods for 400,000 dollars and less, just maybe not in the areas you've been craving.
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Old 07-08-2008, 10:23 PM
 
20 posts, read 55,274 times
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Default Wise... not sure

Ira,

1. I do not know whether buying right now is wise. While real estate prices may fall, it's not a guarantee. But we do know that interest rates will not be going down anymore. Save 30-40k in price or 20-30k in interest and keep paying rent seems very much like a wash to me.

2. Not really flexible on location. For commute purposes, for gas prices... but ultimately for how much I work. I don't want to work 7:30am - 7pm and have to take a 45 minute bus ride/wait/walk home.

3. I'm willing to reduce my Roth contribution as it is post-tax

4. 3b/2b with yard large enough for a 60 lb dog to run. Anything over 1400 sq ft would be ok. But 1400 sq ft of living space... not basement, not patio, porch. Sq ft calculations here are "inventive".

Ultimately I'm curious. Wondering how members of this board could afford decent homes in the Seattle green lake vicinity. I realize that I probably won't be able to purchase comfortably for another few years and I'm a bit frustrated by it.
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Old 07-08-2008, 10:50 PM
 
9,618 posts, read 27,287,468 times
Reputation: 5382
The only reason I could afford a home in the Greenlake vicinity is because we have a paid off home, but certainly not based on income.
Not to be too nosy, but will the job be around Greenlake?
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Old 07-08-2008, 11:42 PM
 
28,110 posts, read 63,531,084 times
Reputation: 23235
Quote:
Originally Posted by sbdude76 View Post
So I pose to this forum... how the heck does one buy a home in the Seattle area? Due to pets I need a decent sized yard... something bigger than the 5x5 they have in the townhomes that I can afford. Also I need it in a decent area for schools. Places I like are in the Green Lake, Capitol Hill, Wallingford area.

I make a little over 100k, which is not a bad salary... not too good either, but still when I look at homes in Seattle it makes me feel poor. I make more than the median income. How the hell do people afford homes in this city?

Quote:
Originally Posted by sbdude76 View Post
It's amazing how people on this board don't address reality. Making assumptions that I drink coffee or alcohol, smoke is untrue. My significant other and I don't eat out more than twice a week also, and not at anyplace fancy. Only "sin" that I commit is eating out for lunch, which I ration to $6 meal.
No offense intended... I was only sharing how by diligently saving I was able to afford WA on a salary less than yours...
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Old 07-08-2008, 11:52 PM
 
28,110 posts, read 63,531,084 times
Reputation: 23235
Quote:
Originally Posted by Ira500 View Post
OK SB Dude, here are some questions for you:

1. Do you feel it is necessary or wise to buy a home in Seattle right now? Many people are happy renting. I know someone who rents a million dollar home on Mercer Island for 2500 dollars per month. Right now the sales price to rent ratio is out of whack, which suggests that prices will come down, or rents will go up, or both. Some people rent and put additional money aside for a larger down payment.
Ira.. I know of several million plus homes/estates being rented in the $2k to 3K range...

One of the owners works for an international company assigned to Europe for 3 years and didn't want his home unoccupied... lots of things can happen... frozen pipes, fallen trees and vandalism... to name a few.

Renting, often is a much better deal in terms of cost and commitment...
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Old 07-09-2008, 08:25 AM
 
3,695 posts, read 11,354,539 times
Reputation: 2651
$80K at 30 years old is great.

You make plenty of money and have plenty of cash on hand to buy in most neighborhoods, but you have your sights set on one of the most in-demand of Seatle's neighborhoods. Your expectations are out of line with what you can currently afford. If the neighborhood is non-negotiable, you might need to make those financial sacrifices that will let you live there. Or you could look in nearby areas and find a more modestly priced home. You could find homes in your price range that are 3 br 2 ba with reasonably sized yards as close as Jackson Park, Licton Springs, and Greenwood.
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Old 07-09-2008, 08:57 AM
 
Location: Edmonds, WA
121 posts, read 535,182 times
Reputation: 58
You are now dealing with the same situation that I went through last year. We have a slightly higher income, similar cash (it was equity in the property we sold) and a list requirements for a home. We wanted less than 10 years old, 1800+ Sq ft, a list of neighborhoods that we wanted, and NOT a split level for less than 450k. This was at the peak, and while that doesn't seem like a very rediculous wish list, it was IMPOSSIBLE to find a home we liked using that criteria. Yes, we were picky, but when you are spending that kind of money, I guess I feel like I deserve to be picky.

So, my point is, you want a 3bd/2ba 1400 sq ft home, and you want it in Greenlake, and you want a big yard, but don't want to spend more than 400k. But, the market in Greenlake is probably more like 500k min for that house. So, which one do you want to sacrifice?

I lay it out that plainly because thats what I went through. We were $100k+ below the house we wanted. So, we had to decide which item to settle on. We chose to settle on the type of house. We bought the location, age, and square footage we wanted, but had to settle for a Townhome. We paid 380. We decided we'd rather settle on on the Townhome and pay way less money than stretch to the absolute top of our price range for a house that wasn't perfect. Now a year later given what the market has done, I feel good about our decision...but it was very difficult to "settle" at the time.

Good luck with your hunt.
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