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Any Property Management recs in Seattle area? :(
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Math checks out to me. Enjoy the new home!
So your monthly payment is approx. $5k with the mortgage, home insurance and property tax, and your net take home pay is about $16k a month. The math sounds decent. A few things to consider are 1.) whether you have enough emergency fund/savings to address repair and maintenance that will come up, 2.) have you done an inspection on the house to look beyond the surface of the house, things like the age of water heater, AC units, cast iron vs pvc pipes, etc., 3.) how much property tax will increase after the sale next year, 4.) do you have experience dealing with lawn care and foundation issues that come with a single family home, 5.) how long would you have to wait to save up for 20% down instead?
Also my point about 20% isn’t so much about PMI. An escrow is typically required for home insurance and property tax when the down payment is less than 20%, it basically means you are paying home insurance and property tax a year in advance, the cash could’ve been used as the down payment or be invested. Also when you reach 20% equity, the bank doesn’t automatically remove the PMI, you would have to pay a fee and do an appraisal. Obviously if you have been looking and this is absolutely your dream home, don’t wait because of these concerns. But if you are on the position to wait, don’t rush just because.
Be sure to factor in things like HOA fees, lawn care, etc. that are not part of your mortgage payment. The little things add up pretty quickly.
Luckily our HOA is only $1000 a year, so it’s not too bad each month. Yard wise, we’ll be doing all of the mowing and things on our own for now. That said, I will likely be getting quarterly pest spraying if we need it and we may have to get pool service ugh.
You’re going to be fine. I make about 150k gross a year in Dallas and looking for homes around 300k so if I was making 300k a year my budget would be similar to yours. Minimal debts myself currently.
How long have you been making around 300k/year?
About a year - we’re both 30 and 32, so young and are still looking to grow our salaries. I’ve been with my company for 8 years, and he’s been with his for a year.
Subject Expert
How much would PITI be? How much larger is the house compared to your current place that you are renting?
Hot take - you may be better off continuing to rent and investing the $45k down payment you have + the difference between PITI and rent. Seems like you’re looking at $1k per month in property taxes alone, and your PITI may be close to $5k. Investing the $45k you have as a down payment and the $30k per year that is the difference between owning and renting probably will produce a higher return than the home is likely to appreciate.
Subject Expert
Sorry, I realize 15% down on a $680k house is ~$102k. Take $102k + at least $12k to $15k saved from renting vs. buying (even if you rent a larger house) + all the savings from not having to upkeep a larger house = you’ll likely come out way more ahead investing in other stuff and renting. Texas property taxes are a killer for long term ROI…
You didn’t mention kids, but how are the schools to which the new house is zoned? Depending on where you are, quality of schools will be a material factor for resale (and if you have or will have school-age kids, will you need to factor in the cost of private/parochial schools on top of your mortgage).