How much should I invest in buying a HOME as my primary residence.

Current TC: 200k
Net worth: 300k, readily available 170k in stocks, hysa and cash
Current rent: 2000 per month
Age: 30

Wonder if anyone has any excel model or a rule to determine how much I can afford or should go for?

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Answered a similar question in another bowl, but here’s my opinion: Think less of ‘affordability’, more of ‘equity’. Use leverage (debt) as much as possible. Two primary reasons for this. First and most obvious, low interest rates. Historically low rates is not a natural event. It’s artificial and you need to leverage that; Second reason: inflation isn’t going to ease any time soon. The more equity you own (i.e. the higher value of your home), the more protection you have against the decline of dollar purchasing power. So based on your situation I’d say go maximum. Leave ~100k in stocks. Use $100k as down payment, and go as high as $1 million if that works in terms of mortgage approval.

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Completely agree with EY1. In this inflationary environment, go hard into assets that follow inflation. Stocks are good but a primary residence in real estate gives you leveraged returns. As long as you can meet the monthly payment obligations, buy the highest value property you can. Even if you have to rent out a portion.

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I would stay less than ~600k. Generally 3x salary for max.

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Calculate your post tax income (minus current 401k contributions), subtract reoccurring monthly bills such as student loans, auto loans, investments, etc. Then take that number and make a table of: 25%, 27%, 30%, 33%. Your monthly all in with mortgage, tax, insurance, etc. should be within that range. You can use that to figure out how much mortgage debt you can take on. Look into FHA loans so you can put as little down as possible.

That’s how I crunched my numbers as a hypothetical. I haven’t started looking but that’ll be my plan.

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Depends on taxes, COL, your other debt obligations, etc.

Op I have similar stats on TC (230) and NW but my rent is 2600. I recently bought a property for 550.

👀 👀

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