My fiancee and I are looking to buy a townhome in the next 6mo or so, and while I've crunched the numbers I'm looking for feedback from the community. We are looking for a new construction townhome in the 750-800k range in California. Together we have a gross income of 170k, which comes out to something like 120k net, or about $9600 per month. We have 80k in a savings account that we want to use as a down payment. We also have 35k in a CD that matures in 13mo. To put into perspective, we are currently paying $2500 in rent. And we are still contributing to HSA, IRA etc. We have no debt, excluding the ring payments on a 0% apr card for the next 12mo. Both of our credit scores are above 750.
So far, so good. The problem I have is if we will be stretching ourselves too thin on the mortgage.
Based on the quotes I have gotten a 30yr loan would be about 4.2%. But most places want 20% in order to get that rate. That puts the loan at about $3500/mo
Property taxes are somewhere between 1% and 1.2% (closest number I found was 1.05%) And HOA will start at 250 and decrease to 200 when the community is fully built. Adding that all up brings me to $4500/mo
That means about 47% net income would be spent on housing. In my mind it's doable, but would greatly reduced the amount we can save at least for a few years. Other things not factored are garbage, water and electricity (the unit has solar).
Keep in mind this is California in a HCOL city. There are some options for 500-600k but then it would need some renovation to get what we want and everything in our price point has HOA unless we want to go for 900k+ homes.
Submitted May 11, 2019 at 11:59AM by 00firestar00 http://bit.ly/2JeoeFL
