From Seattle. I saw the months when the price kept rising and so did interest rates. Some homes we really liked, but were outbid on almost every front. One thing we were sure of, never to compromise, if we were going to get a home, it would be the one we loved. With time, we realized it quicker. Few pointers for current buyers that helped us, 1. Market is crazy. Get with the program if you want to buy. 2. You will have an appraisal gap. Be prepared for it! Prices aren't catching up to previous sold homes. 3. Your budget is not related to the purchase price. It's how much down payment you can afford + your monthly. Both are correlated, but not the same. -- You can put 20% down on 1.5M home or put 10% down + 150k appraisal gap for 1.65m home. Your loan amount will not vary significantly. Your monthly will be affected due interest rates on 10% down, but your wage will likely increase with time so hopefully it works out. -- There are lot of programs with no mortgage insurance with less than 20% down. Do your research. 4. Know your limits. Know when to quit. I've seen 55% escalations on fairly priced home in decent neighborhoods. There is just no inventory. No point fighting these battles. 5. Early offers may help, but need to be insanely good. If you don't have that kind of money don't do it. Sellers are waiting till offer date on most sales. By offering early, you are just giving them bargaining chips. 6. Be underwritten! Helps in faster closing. Sometimes seller might prefer you just coz you can close faster. 7. Be prepared for market to go down after you buy. The logic is simple, if the rate of increase never changed we all would be 20 ft tall by now. It will reach a breaking point and you are likely buying at a high. Don't over extend yourself that you have to worry about monthly payments should real estate and job market melts down. As a rule of thumb, I always save 50 months mortgage payments for savings. 8. Don't look back at what you could've bought. It will only bring you pain. Just look forward. As for me, I bought in Bothell. Paid through the nose, but am happy. Can manage monthly between me and wife. Believe we have decent cushion. Could we have gotten better? Yes. Will there be better homes than us in future? Definitely yes. But we are happy for now. Hope that remains :) Happy hunting folks. TC: 230k Yoe: 11 Edit: wow, this blew up! Want to address few things, 1. About 50 months mortgage saved. It can be invested into stocks, bonds, etc. Didn't mean to say hold on to that much cash. Also, 50 month runway is just me.. have 2 kids, sleep much better at night knowing if things go down south, we should whether storms. My father was a real estate agent in 2008, we had a rude awakening. Maybe some PTSD for me. Would like to maintain our lifestyle and home in worse case scenario. 2. Should have mentioned, but household income is around 400k. 3. My home stats, list price ~1m, our bid 1.3m, appraisal ~1.15m. 10% down and rate 3.25% after buying down points. Can't reveal more without giving it all away.
Is ur HHI > TC? Quite difficult to buy on the income in east side at least
Yup. Total hhi 410k
Buried the lede here, congrats in any case!
Congrats!!!
50 months? I live in a modest home and thatās like 150k which is higher than my NW
Yea thatās wild. How about 6 months?
Kinda stupid to save 50 months. Zero logic there. 6 months to be safe. 12 months to be extra cautious. 50 months to be classified as paranoid. Imagine having $200K sitting in the bank as an emergency fund.
Congrats
Good post agree on all posts except 50 months mortgage that's insane
I think OP added a 0 by accident LMAO š 5-6 months is much more typical savings. The idea of a rainy day fund is to bridge any potential unexpected gap in employment. 50 months is a long time to go without a job!
From your post: "I won" = "Got to spend more than I can afford on a house that wont appraise". Let me get in on that.
Haha.. it feels like a gut punch yes.. it's bittersweet really
Mind sharing redfin link in DM? I'm also looking.
Redfin link. Letās see what is your taste.Here or dm.
Anonymity, people. It's what Blind's about.
Sales price? How much % above asking you gave? Mortgage type and rate?
~1.3m ~30% 10% down. Appraisal gap 150k 30 year fixed, 3.25%
pls dm the link if you are ok ..
Congratulations