So I live in a high cost of living area, and with interest rates being what they are and the market being what it is, it would be almost impossible to find anything for my growing family in the area we want to be that comes even close to only three times our annual incomes if we want to stay in our current radius.
We are looking at two houses to get out of our townhome we've been in for 15 years. We have about two years of income in equity in it that we will use for a new house.
Here's the thing: Even The "cheaper" house options we are looking at are still 4.7 times our yearly incomes in our city. You can get cheaper, but they are in areas we have no desire to live in either do to school districts, commute time etc.
The one that is more expensive--but we would put more cash down on to ensure a DTI under 36--is 7.3 times our annual income.
We have no other loan obligations except our current mortgage, so we are in good shape there, and we have several years of income saved up in cash for down payment of 25-30 percent on either home, but the total home prices in my area are simply MUCH more expensive than 3 times our yearly income.
So is this old rule even valid anymore? Or is the answer "move to a cheaper neighborhood farther out" the correct one here? Again, we would pay enough cash on any home we got into so that we wouldn't be over-mortgaged, but I am really wondering about this rule and if it still applies.
Submitted October 17, 2021 at 11:29PM by Feed_Me_No_Lies https://ift.tt/3jbWh1A
