My wife wants to buy a $450K home in Houston. I make $155K TC and she makes $20K TC. I pay 100% of the bills. We own a couple rental homes, one of which has appreciated about $100K in the past few years. Am I too cheap for not wanting to move out of our $1500/month apartment? I prioritize saving 20% of income. I may have to cut into this a bit to buy this home. Keep in mind a $450K home in Houston is about 3,000 square feet and pretty nice. Not luxurious. About 30 min outside of downtown. I work remote.
Where do you live now?
Memorial City, Houston. House is in Jersey Village, suburb of Houston
30 minutes commute time will be 1hr during traffic hours. She will be a nurse. There is a reason that doctors and nurses are living in memorial or medical center. I would consider this first. Have you ever lived in an SFH? The maintenance and keeping up with the stuff that you haven’t experienced before might be hard. You can offer her renting a smaller SFH before deciding to buy. She might voluntarily settle down for a small house after experiencing it. Lol A house is a house, but I wouldn’t prefer spending 450K on a big house unless you have 6 kids?. 300ish for an SFH and 150 for a 1+1 investment property look more reasonable to me.
A 450k house doesnt feel luxurious at all given current prices for houses. Its an asset anyways so you dont lose too much.
That’s fair. And her point is 3 years ago that house was $350K just like our house 3 years about was $250K. So I do believe she has a point.
Yes I have told her that and it didn’t go over as well as I anticipated lol. She is going to nursing school this coming year, graduating in less than two years. I told her it might be more realistic then. To be fair, she isn’t throwing a HUGE fit. But she says if she can’t have a house like that she doesn’t want to live in a house at all.
That's some seriously shallow thinking.
Well then you can continue to live in an apartment and continue to invest in rental properties.
The mortgage on a 450k house is like $2k per month. Not a ton more than you are currently paying in rent plus there are tax benefits of owning vs renting so that makes the math even closer
True, we just don’t know his expenses though. Maybe that $500 / month makes a huge difference? He pays for all the bills so it’s hard to gauge
I think my replies went somewhere else, but in Texas it’s $3K a month including property taxes which are high (no state income tax). If I sell my current home and use the equity it will be closer to $2400/month. I have the money, but I would be saving 12% a year instead of 20%. If that makes sense.
Do you leave in a rental apartment and you have two other rental properties? Trying to figure out if your current place of residence could be used as a rental. Also how much loans do you have in your other properties? You might be reaching close to the 50% dti.
Yes I own two rental properties about then rent an apartment. You’re correct on the 50% DTI, so it would be a requirement to sell at least one of the homes I have (240k loan in Houston). That would allow for about 90-100k down, avoiding PMI. It’s doable, would just be at least $1000k more a month factoring in utilities.
My recommendation would be to buy another home when you can do it without selling one of your existing properties. You will have to pay capital gains by selling your rental property if you don’t qualify for exclusion. Not only you are increasing your expenses by moving into a bigger home you are also killing one of your income stream. Not sure if it is a good idea.
At the end of 30 years, you’ll either have a box of rent receipts or you’ll own a home. Choose wisely.
I already own a home in Houston that I rent out, so they are paying the mortgage. Living in an apartment allows me to do that while paying cheaper rent. I would have to sell that home to buy any new one, as I don’t make enough to have $700K loaned out from the bank. In a perfect world, I would sell my current home, and buy a $350K home, with a chunk of money down. A house like that is nice but a little older, or new and much farther out.
Meh this is a silly thing to say. In many areas rent is cheaper than mortgage interest + property tax + insurance. Factor in maintainence and rent + invest the difference comes out way ahead.
Buy
Buying a home is investing in yourself. You will have better quality of life.
Exactly. A better environment improves your productivity and happiness, then you get promoted, start a company, or upgrade your money indirectly somehow.
My suggestion is to buy and focus more on improving your income. There are a lot of room for your income to improve. Choose a house that makes you happy as a couple to live in. Happy families thrive.
This is a valid point. We fight constantly especially with both of us home 24/7, with me working remote. Back when we lived in a big house (even with roommates) and I worked in the office it was better. I am focusing on increasing my income, especially after joining Blind. Y’all inspired me to pick up side work and push into presales. Still along way to go. Part of me wants to learn to code….I’ve been in IT for 8 years
Not tryna butt into your relationship OP, but is it a good idea to buy a home with someone you fight constantly with?
This will go over well. Do it OP
Lol