How much $ to move to a bigger house….

posted 3 years ago in Finances
Post # 2
Member
1598 posts
Bumble bee
  • Wedding: November 2017

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reptilelvr :  there’s so much information missing here. To buy a house, which you should know already since you own one. You have a down payment and then you have a monthly payment calculated based on mortgage, interest, and property tax rate. Only you and your husband know how much you’ll have for a down payment, likely based on the sale of your house. Then you calculate your monthly payment from there if you apply it towards a $350k house. I don’t know how property taxes work for you, but houses in our city get reappraised by the county every year. This year, they increased our total taxes by $5k for the whole year (an additional ~$500/month). If that is what happens where you live, is that something you can afford if you take on a more expensive house? What about your other expenses? Repairs? You’re better off doing calculations with your husband, or talking to a financial planner….

Post # 5
Member
8757 posts
Buzzing Beekeeper

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reptilelvr :  if you have a second child and start working more will you have added childcare costs? Our PITI is less than 20% of our net base pay (we both have jobs that earn OT regularly, but we save all of that extra money knowing it isn’t guaranteed). We have zero other debt and I still wouldn’t feel comfortable going any higher than that with young kids. I’m due with out first in July and daycare alone will eat up another 17% which is almost as much as the mortgage! 

Post # 6
Member
568 posts
Busy bee

Will you make money off the sale of your current home? Do you have much equity?

Post # 8
Member
1301 posts
Bumble bee

I wouldn’t be comfortable with a $400k mortgage on your current salary. Especially with basically one income – what happens if your husband loses his job? You say he will be making more and you will be making more – how do you know this? Don’t buy a house based on future income. If you go back to work, have you factored in childcare? 

Post # 9
Member
1171 posts
Bumble bee

Our house was $400 000 and when we bought it our combined income was just over $100k. We had a 30 year mortgage and were living quite comfortably. We’re at the 5 year mark and will be refinancing to a 20 year mortgage as we’ve put in some extra payments. I think if you can afford the monthly payments along with other Bills, and are still able to put away savings you’ll be fine. Although like PP said, do keep in mind if your husband loses his job, that you’d be able to afford it. 

 

Post # 10
Member
182 posts
Blushing bee
  • Wedding: February 2016

It depends on the market. In competitive housing markets, I would be comfortable with up to 5x your salary (in your case – $615k) if you can afford 20% down. 

Post # 11
Member
2804 posts
Sugar bee
  • Wedding: May 2016

Not sure if this is a possibility for you, but have you considered putting an addition onto your current home? 

 

Post # 12
Member
723 posts
Busy bee

What is the sqft and # bedroom of the current house? Is your current home in the safe area and in good school district? Is the type of home you are looking for in the safe area and in good school district? What is the price trend of the current home and/vs. prefered new home?  How much is equity of the current home? What is the backup plan if your husband (heaven forbid) suddenly lose his job, for both the current house and the future house? If you really want 1 room/kid, can an addition/room repurpose/finishing the attic be the third viable option?

 If it were me, these are probably the questions that I think are important to be answered first before I can make any decision of moving to bigger house. Kids sharing room is easier than kids have no house. 

Post # 13
Member
7526 posts
Bumble Beekeeper
  • Wedding: June 2013

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reptilelvr :  my husband and I made about $155k combined when we purchased a house and our financial advisor suggested not going above $350k. We only felt comfortable paying about $250k so that in the unlikely event one of us lost our jobs we would easily be able to afford the mortgage. For further comparison purposes, we were saving at least $2500 a month after contributing 8% to our 401k and maxing out our Roth IRA, our property taxes are less than 2% and we have no kids (with no plans for kids in the close future). I throw all this out there because it seems like we’re similar in financials and I would absolutely not consider a house in the $350k-$400k range.

All that being said, houses by us are also way cheaper than in your area (our $250k got us a 4 bedroom in a nice neighborhood) so perhaps my priorities would be different in a different location. 

How big is your house now?

Post # 14
Member
2523 posts
Sugar bee
  • Wedding: July 2014

Houses are expensive where I am from- we make about 100k combined and bought a house for around 300k- and we live quite comfortably (even with still paying off school loans).  My husband makes more and we could manage on just his salary- he is in a really growing field (I doubt his job is in jeopardy), but even if so he could easily find employment.  To me, it sounds like you have the finances in order, but you should meet with a morgage broker and financial advisor.  They can take a closer look into your specific situation and give you professional advice.  

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