At what point should you buy a home? I have 120k saved up and want to buy a home in Chicago that requires a 60k down payment. My plan is to move back in a few years, but rent it in the meantime. Currently renting in Bay Area and 0 interest in staying/buying here.

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You saved up $120k living in the Bay Area? Impressive

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Having rented out my personal home for a year and then moving back in after, I highly recommend against renting out a place you plan to live in.

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A lot of people are really dirty. Even after we had the house professionally cleaned after, we really didn't want to live there again. I mentioned this to 2 friends that have rental properties and they both said they wouldn't live in their rentals because of the same.

I have a more conservative position than most, but I’m budgeting ~30% of the home’s value in cash prior to pulling the trigger as I save for a home purchase.

20% down payment + 5% closing costs means you need 25% just to close the transaction.

On top of that you need cash to furnish the place + extra cushion so you don’t “close broke”. This is more nuanced as it depends on what you are comfortable with, I am just assuming another 5% on top of the aforementioned 25%.

In your case, a 60k down payment means you’re looking at a 300k house. 120k in cash should be more than enough backing assuming that is what you’re looking at.

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Bought my place with just 3% down. Sure i pay pmi but my monthly still comes out less than rent would be. Don’t stress too much about 20% down. Just crunch the numbers and see what makes sense for you. While you’re saving for the downpayment, home values may continue increasing.

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I 2nd this, I just bought my first home with 5% down. I had about 20% in cash total, but wanted to make sure I had a strong emergency fund and money for furnishing. Home values are increasing a lot in my city so I didn’t want to wait. I also have roomates who are helping pay the mortgage. I wouldn’t have gotten that money if I didn’t buy early.

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