House affordability suggestions
My wife and I, both work for Amazon, and are considering buying our first house together. Below are some of our combined financial parameters - Combined TC - 450k Total savings - 800k (includes vested RSUs, investments, emergency cash, excludes 401k) Post-tax monthly base pay - 15k Avg Monthly expenses - 6k (2.8k rent) Location - Seattle The key here is that both of us are 30 and are planning to have a baby in the next year or so, followed by another one, maybe 2-3 yrs down the line. We would like to understand, how significantly do expenses change after having a baby as that would play a key role in our decision making. Also, as have always been in downtown, we don’t own a car but moving to the suburbs would mean buying a car each, thereby increasing our monthly expenses by at $1k or so. Based on the parameters above, we would like to get your thoughts on what is the price range we should be looking at, when buying a house. Right now we are looking at something around 1.4-1.5m. Are we going overboard ?
No. For 1.4 you should get a really nice house in suburbs. Go for it.
Does your monthly expenses of 6k include rent?
With the amount you have saved. You could reasonably buy a nice home in your area outright and still have a few hundred thousand left over. I’m not sure what your debt situation is but if owning a home is important to you both and you are planning on starting a family soon. Just buy the home now while you have more time and flexibility in your finances to do so. If you pay off the whole thing or have as low a mortgage as possible then you are setting yourselves and your future child up for a much simpler life financially speaking anyway. It might be a huge hit to get the house now, but think of how great it would feel if in a few years you own your home, have a child and know that the extent of any debt is just recurring utility bills and property tax? In that scenario the vast majority of your monthly take home can be put into building back up your savings and investment portfolio, while also saving a bunch for your child’s future.
Consider Columbia City which is walkable to light rail.
Childcare will be your biggest additional expenses; think 1.5k+ / month.
Allocate 2.5k month per kid for childcare and other expenses. Of your taxable savings, is it all for a house or other investments as well. I think in the 1.3-1.5 range would work for you Consider also renting SFH
With the income and cash that you have, you can qualify up to 3M purchase price. Even more if RSU income is accounted. So buying half of what you can qualify for is a good thing.
You should be fine