Hi, My TC (at $210 stock price) is ~700K. But only ~310K is cash (salary + bonus). Wife is a stay-at-home mom. Non-retirement accounts + cash in bank accounts: 450K (I was working for a small company in a MCOL area; this is my first big tech job) We're planning to buy a house in Seattle (Eastside : Redmond, Bothell, Kirkland). All the decent houses are like ~1.5 million. That puts our mortgage payments (including property taxes etc) north of 8K per month. It seems a lot of people in this group are advocating against buying a house with 8K+ mortgage payment. I also see some posts advocating for buying a house with monthly payments as 30% of net income. But I am not sure if it is total income or just the cash income. Just wondering if we should be good to buy a 1.5 million house. Or, should we strictly go for a house whose mortgage is 30% of *net cash salary*. Thanks!
In a similar boat but ofc with a lot less income. I’m going with 30% of total income. Maybe I won’t save much from base salary but strictly planning to save bonus and stock
Can you walk me through how 30% of total income = not saving much? That seems a relatively conservative ratio
I’d say rent a house and opportunistically buy a house whose sellers are beating themselves down a lot on price. Given high interest rates there are few buyers and sellers are making price haircuts. When rates come back down you can refi. You can afford an 8k mortgage payment. Remember, not all of that is cost, some of it is savings.
You're fine at $1.5M-$2M, except you need more cash cushion to avoid risks. You can buy now so long as you have a plan in advance on how to sell.
What is your level at meta ?
same question. 700k must be L7?
You sure you won’t get laid off if there is another lay-offs!! I am not kidding people who got laid off are suffering to pay payments
You are making 700k and you want advise from folks making half or less of you. You are smart… make your call man.
Dude is probably good at tech and got lucky at meta with grant timing. Doesn’t mean he knows shit about finance, which is made clear by his question. Don’t let your success in one area delude you into thinking you’re good at everything or can’t lose.
Congrats on the TC. 30% isn’t a one-size-fits-all rule in regards to housing, especially in HCOL areas. Looking back the last few months (Nov) would you still be able to stomach the payments if the stock takes a nose dive?
Bro how the hell are you making so much? Please share some tips.
Why don’t you look up some of the stories on here of people currently facing ruin after talking themselves into mortgages like this? The 30% rule breaks down when you count your RSUs. You think if meta drops you next week you will turn around and find something to match right now? And wait a year or so to vest? Word to the wise, don’t count your stock grant when getting a mortgage. Use vested for down payment sure, but mortgage should be affordable on base only and in this market on base you are sure you could get elsewhere. Or YOLO, but don’t come crying when you fuck around and find out.
If 700k tc cant buy 1.5M, then no one can. It all depends how much you really want a house. You can always rent one.
You do realize hundreds of thousands of Americans make far over a mil a year? And that at least 10% of households have a net worth over a million? Tech is so blinded by new money big salaries, but they have no idea what real money or actual wealth is all about.
Bullshit statistic. 10% of Americans do not have a million dollars.