It’s hard to find anything decent below $1.5 million in a good neighborhood (that was initial stretch budget), I know 200k extra will be a stretch but I can sell my stocks to cover the gap if needed. Married, No kids, majority of this $450k is from one income, with $230k fixed salary. Currently renting. Net worth: $1.4 million (but ~500k is in retirement accounts) Down Payment: Can do 20% where ~15% will come from cash and rest ~5% by selling stocks #housing #mortgage
What is your total NW, how much do you have for a down payment, and what mortgage rate can you get?
As soon as you start bidding, you will realize there's nothing for 1.7M. rather like 2M+
So this 1.7 million is considering list price of 1.4 or 1.5, I will not bid for a home with list price of 1.7
How much down payment are you planning to put down? A mortgage of 2-3x your TC should be doable. 3x as long as you have 1 year of emergency fund available.
Yeah 20% down payment, emergency funds will now require to have 1 year of mortgage backup as well right? Might be difficult to keep cash like equivalent for that.
Yes, emergency savings in a HYSA, so cash only. You could do 6-8 months but I wouldn't go below 6 months. You're fine with a 1.4M net worth, it's not even close to a concern. But why only 20% down? Do you think you can guarantee beat the market interest rate of 7% after taxes (meaning, roughly 10-12% before taxes)? I wouldn't bet on that, if anything, I'd recommend 40-45% down. Also reduces your monthly payment, and you have the funds.
Make sure you have 6-12 months of expenses ready. Not now, but save for it within the next couple of years. If you can save, you are good. If you can't and just hope that nothing bad happens, that's too risky
Yes definitely doable within the next year, thanks for the advice
Buy now if it is absolutely necessary. Market is very bad . Almost no supply. If you stretch for buying house . Maintenance, renovation and other expenses can be difficult. Wait for 6-12 month. Hope for stock market crash and keep cash worth 30% of the house price.
Which part of bay area are you finding a 1.7M home?
If you can wait a few months then commissions should come down a bit after the new anti trust lawsuit. Could save you the difference.
If you can continue your current lifestyle + mortgage one person salary, then go for it. Otherwise, it's not worth the headache, especially if you are on a visa. Don't let house buying FoMo get to your head.
Gooooo
What's your net worth
Updated.