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Don’t buy together unmarried.
If married, budget based on your combined base salaries.
I wouldn’t buy together until you’re married. If you do want to buy (which imo makes sense), buy within your means and have your name solely on the mortgage. At that income level, I’d target something in the $600k range assuming you have a down payment saved, which will be about the same as your monthly rent payment now. Up to you if your SO pays rent/bills.
Keep in mind you’re not going to buy your dream home to start. This should be a “good enough” starter home/condo where you can see yourself living for the next 5-10 years.
Then keep renting! I get it - the options I found in my range were an hour outside the city, but I could have made it work. Eventually decided against it for other reasons, but anything within 30m of where I am now was closer to the numbers you’re mentioning
Why apartment when yall can afford a mansion. Get a $2M mansion in the burbs and go have lots of kids to go with it. Bless ya both!
I’d say better to buy and build your equity over the next 10 years. You could be close to paying off a 15 yr fixed rate mortgage, imagine what the valuation will be by then
I need to know how can i make 350k a year as a 30F :) no advice just here to say congrats
MBB?
Subject Expert
I would keep on renting for now, at least until your plans for kids and marriage are firm.
The $2m suburban home is within your means and might be exactly what you want in 5 years time.
Buying a starter home is not necessary. Rent until you know what you want.
I was in similar situation with my now husband, and decided to buy a two-family house in Queens. Mortgage is $8,500 but netting out our rental unit, monthly around $5,200. A plus that work commute to Midtown is 25-35 minutes door to door. Buying is a real process, wish I had gotten more guidance and prepped better but don’t regret the purchase.
Rent now, buy when you’re married and have kids and have some cash saved up.
Confused by ‘single’ and then ‘significant other’? Meaning how would I advise to buy if I’m not sure what that would look like longterm.
Subject Expert
Thank you for sharing openly.
I don’t have a lot to add. I don’t think it would be a huge mistake to buy, but I suspect you would end up buying a place together a few years later.
Perhaps buy a place that you might be able to rent out later?
Do the rent/buy math and remember that when you own all of the maintenance is on you. Plus, in my experience, the standard I have for a place I own is higher than an apartment I rent. Before you know it you’ll be paying for unglamorous things like new windows and a furnace while day dreaming about ripping out the bathroom and building a steam shower.
Similar profile to you in terms of income, living HCOL, and requirements. I did the math and it didn’t make sense for me to buy at all. Currently renting a 1 bed for 2,900pm and if I were to buy, it was working out 6-7K pm (mortgage, interest, HOA, fees etc), plus the opportunity cost of not investing the difference.
Planning on reassessing in the next 2 years but for now, a tenant I shall be.
The house/mortgage payment should not be more than 35% total debt-to-income (ratio) so feel free to run the numbers and see if that amount will get you something you want in your price range. That new mortgage debt does not include all other current debt you have (auto, credit cards, loans, student, etc) to service. Cheers
Invest in a starter home that fits your current lifestyle, with the intent to hold it long-term. When you’re ready to upgrade for a growing family, you can convert that first property into a rental, effectively launching your real estate portfolio with a built-in asset. This is doable on a $350K salary, assuming your living within your means and don’t have other large expenses
OP is going to have so much time to manage a real estate empire while working 70 hours a week at MBB!
Continue to rent until married
I was you 8 years ago. Different interest rate environment but similar financial profile. I bought an apartment I felt comfortable living in single, as a couple, and potentially with 1 kid. I also wanted to make sure it could serve as a rental for flexibility. We got married, refinanced at record lows, found a long-term tenant, and now have 2 kids in the suburbs. In retrospect it was a decent decision but only because we refinanced, rents have skyrocketed, and I would consider moving back once the kids are grown. Today I would probably continue to rent.
Thank you!!
I recommend being technically married before purchasing a home together, regardless of how long you've been together. I would also recommend you put far more than 10% down. If you can (and it sounds like you can), put down 30% or more. The smaller your mortgage, the easier it is to face the money crises that most people don't think will happen to them: health issues, work issues, emergency issues, accidents, children, older parents, neighborhood problems, a lawsuit, an unexpected death, etc. Paying PMI when you don't have to is kinda wasteful. Keeping a mortgage for 30 years is equally silly. If you put down a large payment, you can pay off your mortgage two notes at a time. Now, THAT feels great!
What M2 said. Check out the Money Guys’ guidelines for home purchases.
I wouldn’t buy a home with someone you aren’t married to right now. I would wait until you are married to buy a home. Too many issues can arise if you decide to go your separate ways. At least if you are married, most states have specific rights and laws to separate property in a divorce.
Things I would think about:
- area you want to live, what's the rent vs mortage differential? Are you saving money by renting ?
- is inventory the market something you'd see yourself living in for 2 years, with your SO ?
- you said you have 100k cash and 200k index. I'd try to keep as much cash on hand right now as you can so don't overspend your cash if you don't absolutely love your place. Keep your monthly payment
What do you do?
Mentor
$4k/month
I’m surprised no one has asked what your liquid cash looks like. How much do you have for a down payment/emergency fund?
My gut reaction is to put 100k down (with at least a 10% down payment), then quickly rebuild your cash reserves. (10% will trigger PMI, but that’s not always a big deal. It certainly wasn’t for my first place.)
When you’re ready to start looking, ask your real estate agent for a good lender. Work with someone they’ve used before and trust. Talk through your options with your lender - they should help with the numbers.
Also, don’t buy with your partner until you’re married. A mortgage is more serious than an engagement.
Have you found out what you're approved for? How much do you have saved? I would think you might want to figure out how to keep your mortgage payment in line with what you pay now. I think $4k a month should be fine.