Hey all-
I'm 25, live in Denver, and somewhat recently realized I might not want to live anywhere but Colorado (besides maybe extended travel) for a long time. This made me think, "Hey, maybe I should think about buying a house", but I'm not really sure how to proceed from here. I definitely don't have the $80k in cash to make a down payment on a home around here, but there are more considerations as well:
The good
- I make 90k as a software developer with less than 2 years professional experience, hopefully that number can continue to grow
- I'm able to save maybe 75% of my take home pay, though all of that money goes straight into mutual funds, much of it in a 401k that I cannot withdraw from. I do have some in an emergency fund, some in a Roth IRA from which I could withdraw principle, and some in a taxable account
- My bank has a high yield savings account that gets 2.5% APY given certain conditions are met (they are)
- I'd be fine with being a landlord to friends in a multi-bedroom house to offset some of the costs
- I would enjoy the process of working on a house, though I don't think I'd like the amount of time it chews up
The not as good
- Homes in Colorado are expensive, and I'm nervous to buy a house I don't want to live in for decades if prices are inflated right now
- I don't know exactly where I would want to live when I'm older. I think I want a family, and maybe I'd like to have them a little further from the city. Maybe I'd even like to be in a medium-sized mountain town. But right now I enjoy my 15-20 minute bike commute to downtown Denver
- I like to travel, have quit a job before to backpack for 5 months straight, and it's very likely I do that again. So might not have a job while I have mortgage payments
Any general strategies?
Have any of you earmarked a certain amount from each paycheck to slowly build up a down payment? Or would you recommend just cashing out a chunk of a taxable account when the time comes?
How do you strike a balance with where you want to live at 25 and where you might want to live at 40?
Thanks!