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We are a couple (34M, 32 F) with networth of 1.55 M (which includes 400k in retirement accounts and 1.15M in brokerage and cash) We enjoy renting apartment and living stress free. Should we buy a house in Bay Area ? If yes, where and which type of house ? Would like to get suggestions from wise people of blind. Current rent : 3300/ month HH TC : 500k
U have kids? If so, yes. If not, yes
Based and Real Estate Pilled
Id say atleast get a condo/townhome and I guess you dont need to pick great school areas (assuming no kids from your post) .. you may find something under $1.2mil Pro- dont have to move often (with apartments they keep changing rents every year ), your home appreciates lil bit and even if it doesnt it doesnt matter, youāre paying principal towards your own home Cons- comes with maintenance but again depends if youāre buying 20+ yr old condo vs recently built. Your monthly payment goes up a lil bit (until rates are lower)
Housing market in Bay Area is garbage. If you do want to buy, move to southern cali/TX anywhere you can buy a decent house with <1 mil. Your competitors in the area from India or China are insane. They live no life besides comparison. Appreciation is their only goal which they can sacrificing their entire life for. They donāt care living in a century year old house with poor conditions as long as itās in good school district and price goes up. Buy if you want to join the rat race
Op didnt ask suggestion on moving to different city. Buy a house in bay area yes or no Let me guess, you compared your home appreciation with your friends in bayarea and feel burnt
Cisco is on a rat race and feel bad about it, but there is no undo button, thatās what triggered him
Start looking at open houses. It takes a year to buy in the Bay Area.
Buy a starter home, and then after a few years, upgrade to a better / bigger home with the proceeds from the sale of the first home. This is what 90% of folks do in the Bay.
man I have more TC than your HH but only 1M networth. how
Round numbers but take home 300k of 500k, live on 100k, and invest 200k for 5-6 years depending on market returns. Pretty simple if you can avoid the lifestyle inflation of making 500k and live like most making 150k.
In the Bay Area you wouldnāt be able to take home 300k. Taxes alone will give you a 170k haircut and housing will take another 40k
Get an investment planner first
Never do this. Itās your money. Go read some books and get financially adept.
Why do you want to own a home? You must answer that for yourself as it's subjective and impacts whether you should or should not.
I donāt see any reasons in your post why you would buy, so the default answer is ādonāt buyā. If you say you enjoy renting an apartment, thatās all you need to know. Why do you think you should buy? Itās not a particularly good investment all-else-equal and will require you to stay in the area or eat the cost of selling. If you have parents or other people trying to convince you; ignore them. Annualized real estate returns are fine but in an area like SF you have significant risk of a total crash due to (likely) failures in the job market you participate in. Investing in a correlated asset thatās also your house is gambling you donāt need to do.