Author Topic: Is it worth buying a house in my scenario- Hou  (Read 1674 times)

frugalitas

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Is it worth buying a house in my scenario- Hou
« on: September 22, 2015, 06:02:36 PM »
26- Living with wife- no kids in Houston since last couple of years earning 90K renting apartment @1200 monthly.
Savings of 60K.
Current commute: 30 min drive
A 3 or 4 bedroom house available for 330,000 Yr 2015 build with commute time of 10 min drive.

30K down-payment and mortgage rest for 30Y @3.92% (Considering highest- I am expecting rate less than this)
Monthly payment with that: 1418
Monthly payment with same rate @15Y: 2207

I am considering an option of 30Y and start making aggressive payments of 2200 every month. (1400 regular and 800 more towards principal)
And refinance after 1.5 Years if I am getting very good rates else continue paying more towards principal as the time progresses.

With current growth I have observed in past couple of years here, it sounds very good to get a house at 10 min commute for price in inner circle of city.

This is my very first question after joining the forum. I have gone through the blog and internet posts, but its a big investment where I want open criticism and advice
and consider scenarios that I may have missed not being a house owner and renting my all career so far since last 5 years.

Current mustachians, please advice.





« Last Edit: September 22, 2015, 06:17:17 PM by frugalitas »

ShoulderThingThatGoesUp

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Re: Is it worth buying a house in my scenario- Hou
« Reply #1 on: September 22, 2015, 06:11:49 PM »
Why get three bedrooms if you don't have kids?

2Birds1Stone

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Re: Is it worth buying a house in my scenario- Hou
« Reply #2 on: September 22, 2015, 06:56:35 PM »
Why get three bedrooms if you don't have kids?

^ +1

Roots&Wings

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Re: Is it worth buying a house in my scenario- Hou
« Reply #3 on: September 23, 2015, 06:59:53 AM »
Can you rent closer to work? Have you used the NYTimes rent vs buy calculator to compare? How long do plan to stay in the area?

I personally would not buy a $330k home with only 10% down on a $90k income when I could rent for $1200/mo, but it's entirely what you value and your goals.

My financial criteria for buying a house included:
1) Must pass rent vs. buy calculator test
2) Must work as a rental/meet 1% rule in the event I need/want to move. I plan on staying long-term (min 5 years) since transaction costs are huge, but you never know
3) Must allow me to maintain a minimum 60% savings rate after all expenses are accounted for (mortgage, property taxes, insurance, maintenance, utilities)

Good luck with your decision!