Am I ready to buy a house?

Cerner / Eng
homeowner

CernerEng

PRE
Amazon
homeownermore
Jan 26 34 Comments

I am just curious, I have a net worth of about 180k. And looking for houses around 400k. My TC is 150K. Is my finanaces looks good for buying house. I am thinking of putting 6% down, my net worth is as below:

Stocks: 110k
401k: 50k
Crypto: 20k

Thanks

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TOP 34 Comments
  • Microsoft Cutwvevdij
    Yea. You can do it.
    Jan 260
  • Just remember: a home will be your biggest liability, not asset
    Jan 268
    • OpenDoor atleng
      Why not both?
      Jan 26
    • Zillow Group / EnganKW36
      Blue leaf puts it better than I would, so here’s what they say: Your primary residence is an expense, not an asset. It’s not as liquid as you think and many people hold onto their homes later or sell earlier than their plan dictates so they can try to time the real estate market. Investment properties or REITs are a better way to have real estate exposure in your overall portfolio.
      Jan 26
    • OpenDoor atleng
      It is both an expense and an asset. Real estate provides little liquidity in a pinch, but it’s better than renting and once your mortgage is paid off it’s like having free money (since you’re not paying for housing).
      Jan 26
    • OpenDoor atleng
      And if you’re within our buybox, opendoor will hopefully provide liquidity too :p
      Jan 26
    • Zillow Group / EnganKW36
      Well except you still need to pay property tax and HOA. Which sometimes can be almost as much as rent. And that (combined with inflation) can almost wipe out any returns. The point is, you shouldn’t look at buying a primary home as something that will provide a return. Yes, it’s a cheaper living arrangement than renting for life, but it’s not guaranteed to be a net positive or even break even.
      Jan 26
    • OpenDoor atleng
      You’re just making shit up if you think property taxes and hoa make up anywhere near as much as rent. Landlords would never make money. Frankly you sound like you’re making excuses for not wanting to buy a house.
      Jan 26
    • Microsoft FBisEvil
      He’s comparing that with the marginal equity you build by buying which is a good comparison, especially if you’re talking about a 30 yr mortgage
      Jan 26
    • Zillow Group / EnganKW36
      Not at all! I was speaking more about condos/apts as that’s what I’m more familiar with, but a lot still applies to houses.

      HOAs are usually pretty inefficient. They are run by amateurs and not as smoothly as a business. Rental companies are far better at dealing with it than HOAs, and they can usually pool resources over many different properties.

      Property taxes can be sketchy as fuck. As they are based on valuation, some rental companies do a really good job of keeping it down. I don’t know how but they do. If you look at 800 Seneca St, Seattle, they are paying $30k a year in property tax for 330 apts. The condos next door get taxed ~$5k a year EACH.

      Mom and pop investors usually don’t factor in implicit costs like inflation. But interest on a home after 30 years at a today’s rate can almost be as much as the home itself. All of these things really add up.

      Nytimes has a great calculator for this, I recommend playing with it!

      But if you live in a tech hub I still think it’s worth buying a home, regardless. As you’re protecting yourself against future rent prices, which will probably continue to skyrocket.
      Jan 26
  • Microsoft moneytree
    I wouldn't recommend it until you have 20% down and atleast 3 months of emergency funds available
    Jan 260
  • New New b
    Cerner and 150k contradicting each other 🤔
    Jan 261
    • Cerner / Eng
      homeowner

      CernerEng

      PRE
      Amazon
      homeownermore
      OP
      i dont work at cerner anymore
      Jan 26
  • Microsoft BarFoo
    Put down 20% and don’t worry about it
    Jan 261
    • Microsoft BarFoo
      For reference. My house was in the low $400s when I bought it, my TC was slightly lower than yours (TC was probably 130-140, and my net worth was similar. I sold most of my stock to do the 20% down (remember to sell enough to cover taxes on your gains from the stock).

      No PMI or second mortgage to deal with when you do 20% down.
      Jan 26
  • Movement Mortgage QSaS36
    looks possible ....if down payment is less than 20% of price - you will pay monthly mtg insurance in the loan ...so if you can manage 20% down - you can avoid this ...make sure your credit is OK ...I recommend getting pre approved if you are at all thinking about buying so you know for certain
    Apr 101
    • Cerner
      lyftipo

      Cerner

      PRE
      Amazon
      lyftipomore
      I have excellent credit I have like 200k in stock buts it just do I wanna sell I am making pretty good money so.
      Apr 11
  • Amazon gentrify
    Important advice on the crypto - sell it now if you intend to use it in 3+ months. It needs to "season" by sitting in your bank account for at least a couple months. Otherwise lenders might not count that as part of your assets
    Jan 260
  • Oracle yso
    I wouldn't recommend just putting down 6% - it's the way for the real estate economy to include for more buyers. I wouldn't put anything less than 20% - this will give you more room for the value of your home to go down before you are under water, reduce your monthly payment quite a bit.
    Jan 260
  • OpenDoor atleng
    I would put much more than 6% down at your net worth. Unless you believe you need to be prepared for some likely financial disaster wherein you need the cash, you should go ahead and put down 20%.
    Jan 260
  • Microsoft stylerZ
    Go ahead
    Jan 260
  • Amazon syrbskcb
    Looks good.
    Jan 260
  • Microsoft FBisEvil
    Housing is about to crash. Save you money and buy after when the fed starts another rate lowering cycle
    Jan 263
    • Oscar / OtherTender
      We have been saying this for two years now.
      Jan 26
    • Microsoft FBisEvil
      Except rates just started going up in 2018. Housing has shown signs of slowing late 2018. Were not even at 3 percent yet lmao. Our economy is so fucked
      Jan 26
    • Amazon gentrify
      Well all I hear from friends, families, and techies nowadays is how they're waiting for the housing prices to drop so that they can buy. Yall mfers have too much cash
      Jan 27
  • New b37
    Home price to TC ratio is just fine. Put as much down as you can and pay it off aggressively. (Source: own apartment worth one third what you're looking at; bought on one third your TC.)
    Jan 260
  • Credit Karma yogi.bear
    Lmao, yikes.
    Jan 260
  • Apple sjshgss
    Don’t get into this like a sheep. Ignore the real estate!
    Jan 260
  • Oscar / OtherTender
    You will be fine. But do at least 20-30%.
    Jan 260
  • Amazon gentrify
    Yall have a misconception about pmi. If you buy in a cheaper area like east bay of bay area and put 5% down, your pmi can be like $100-150/mo. It's different from putting 5% down on south bay or sf homes... where the higher monthly payments and high pmi to insure big mortgage can hurt

    Frankly I'm getting tired of the inaccurate advice about housing from this group

    There's a new group of millenials who just started tech careers and have 200k+ tc and lower savings due to short time in industry. In that case it makes sense to put 5% down and gain a foothold in bay area RE
    Jan 260
  • Yelp lBNQ80
    I didn't know you could make 150k at Cerner
    Jan 260
  • ExxonMobil / Engsexyrexy
    Do the math with the PMI, you are going to have a decent premium with only 6% down. Might be worth it to wait and save some more/liquidate more stocks.

    Overall finances look good to make it happen.
    Jan 260
  • Acxiom RickErwin
    Which city?
    Jan 260

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