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Need Some Input for a First Time Home Buyer

Hey Brahs, I’m about a year out of college, looking to buy a house in the summer of 2019. I’m 24 years old. I’ve been working a shit job since I graduated but I finally landed a better one and will be starting soon. First year I’ll make $68k and it will increase from there yearly. My girlfriend is in nursing school and she should make about the same once she graduates. We both have student loans and car payments, but besides that virtually debt free. If we have a combined gross salary of 130-140k, how much house can we afford? With our car payments and student loans we’re looking at $1200-1400 per month in spending. Probably only going to put 3.5% down on the first house. I’ve started saving, but only have about 5k saved thus far. I should be able to save a lot more this coming year as my salary will double. Any recommendation for a first time home buyer would be greatly appreciated. Thanks brahs

You need to wait 3-5 years.

Don’t buy a house with someone unless you are married.
Pay off the student loans first or at least put a huge dent in them.
Save 10% down or better yet 20%.
By the time you are done with that, you will have paid off the cars. Don’t buy new ones.

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I figured it would be smarter financially to purchase a house sooner rather than throwing away money on a $1500-$1600 rent payment.

Girlfriend, not wife. Meaning you spend based on what YOU make. Don’t be an idiot. Put a ring on the finger and use joint income, or base your budget around your own income. No lender will consider your gf’s income anyway.

Don’t buy a house until your salary ACTUALLY doubles. You’ll qualify for a bigger loan once that happens.

Think big picture. A year or 2 or 3 in an apartment is not a big deal financially. Don’t rush a home purchase, it’s not smart. And homes aren’t a great short term investment anyway. They are much more costly than you probably expect when you factor in things like maintenance, insurance, taxes, potentially HOA dues, interest…

So yea. Wait.

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I definitely wouldn’t purchase it until she was my fiance lol. I just like thinking ahead of the game. You are probably right.

married. not fiance. Again, a lender will not consider her income unless you are married. stop being a dope.

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Don’t hamstrjng yourself with a house at this young. Put away money and/or pay down the debt.

There are various additional costs, beyond a mortgage, that will hit your wallet. Better to rent and invest. I once built a spreadsheet showing that it was better to rent than buy. I’ll see if I can dig it up.

Also, as others have said, no ring then no joint income and home.

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I’ve done the same. When you factor in all the costs of buying, the huge amount you have to put down, etc, renting is generally not much worse, and sometimes better, than ownership.

Ownership ONLY makes sense if your house appreciates significantly from when you buy to when you sell. If you buy a house for, say, 200k, and you sell it for 220k 5 years later, it probably would have actually made more sense to rent. It’s a bad investment.

Is 24-25 considered young to purchase a house? Half of my buddies from college are purchasing homes.

If you’re going to buy, buy a $100k-$150k house in your name only. If your girlfriend wants to live there make her pay rent.

I bought my first house at 26.

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Based on your other posts, you’re going into the military as an officer once you finish OCS, right? Unless you’re going reserves, you could be stationed anywhere including overseas.

Now is not the time to buy, now is the time to be flexible

How do you figure that?

If you rent for 30 years at $2k/month you spent $720k to live somewhere with nothing to show for it at the end of your time there. If you buy a $300k house at 3.92% you’ve spent $510k and have $300k in equity. Even if you sell it at the same price (unlikely) you still only spent $210k on interest, which is worth whatever if you factor in time value of money. The X factor is maintenance, obviously, but I doubt maintenance costs over 30 year creates a breakeven on rent. Someone would have to show me that. I don’t spend $17k+ a year on maintenance.

you’re asking the wrong question. you shouldn’t be asking ‘is it considered young’. you should be asking ‘is it smart’. And the answer is no, it’s not.

I didn’t make money on my first, and least expensive, home purchase. I would have been better off renting, financially speaking. I enjoyed the house, but it wasn’t financially beneficial. I stayed in it for 4-5 years.

Don’t make it a goal to be the first of your friends to do adult-things. It’s a silly endeavor. Don’t rush to get engaged, don’t rush to get married, don’t rush to have kids, don’t rush into a house. DO rush to get your student loans paid off, DO invest in flexibility while you’re young.

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I’m assuming he will not spend 30 years in the house. Nobody does that with their first house.

I will be in the reserves after OCS. I’ll be working full time as a LEO in the city I’m moving to. but I see what you’re saying

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I’m with everyone else. Wait. Save more for the down payment (3.5% seems insanely low), pay off some student loans and figure out what your life actually costs you to live once you’re out of school.

I would also make an effort to track all your spending to get an appreciation of the cost of life; groceries, utilities, insurance, car/car insurance, etc. It may be more than you think but it may be less. It’s solid information to have.

My wife’s family lived in their first house for over 30 years. He may or may not, but it seems like sort of important detail before saying renting is more cost-effective than purchasing.

I leased my car. Probably stupid. lol, did it the day I graduated from college.

I feel like there’s a less than 1% chance this guy spends 30 years in the house. So no, for the purpose of this conversation, I didn’t think it needed to be mentioned. Your point is fair enough though. I assume you can at least acknowledge that the average first time home buyer in America today will spend far, far less than 30 years in their first home, right?

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there is 0% chance

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