Home Affordability

[mustachioso]

Do the mustachians have any favorite home affordability calculators?

I've used the Rent vs. Own calculator and even in Orange County, CA I should buy a home.
(http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html)
The problem is the mortgage calculators I've found vary wildly.

I've found some 'rules of thumb': 30% of pay pre-tax, 30% pay after tax, 1.5 - 3x salary
I've found some possible estimates: yearly maintenance is 1-3% of home price
I've been given some guidance: HOA's cost more than maintaining similar service on a single family home

Given the wide variety, I'd like to take into consideration the opinion I trust most, the Mustachian community!
If nothing currently exists, I'd love to make a web app for anyone facing the same dilemma.

The data (feel free to correct):

Single Family Home:
Price: 500,000
Down: 100,000 (400k loan)
Tax: 6,250 (1.25%)
Rate: 4.125%
Insurance: 1000 / yr
HOA: None
Costs: lawn care, repairs, maintenance
Utilities: electric, gas, water, trash
Intangibles: back yard, fruit trees, room to garden and build things (including new skills)

Townhouse:
Price: 400,000
Down: 100,000 (300k loan)
Tax: 5,000 (1.25%)
Rate: 4.125%
Insurance: ? / yr ($? lower as the HOA covers the outside + hazards)
HOA: 350 / mo
Costs: interior repairs
Utilities: electric (rest either covered by HOA or not available like gas)
Intangibles: 5mi closer to work, bike friendly, closer to stores, closer to fun free things like the beach, could probably sell a gas cheap gas guzzler

The person/people:
$100,000 after tax income
No debt
Fairly mustachian with a silly 2 car clown habit
Solid job
great credit

Rental rate of similar homes in market: 1650 (1bd/1ba) - $2500/mo (3bd/2ba)

Given the above admittedly rounded numbers, what advice could you give?

[arebelspy]

Do the mustachians have any favorite home affordability calculators?

I've used the Rent vs. Own calculator and even in Orange County, CA I should buy a home.
(http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html)

I like the NYT one (though I liked it more before they changed the interface).  What do you find deficient with it?

[CanuckExpat]

What's your monthly take home pay, what does housing consume right now out of that, what would it consume for either of those options (assume lets say 30 year fixed at some reasonable rate with 20% down)

[TomTX]

Cart in front of the horse. The FIRST question should be:

Am I certain to be living in this house for an appropriate timeframe? *

*I personally think a certainty of at least 5 years, with a plan for at least 10 years. The exact time frame is debatable - but if you're planning to move in 2-3 years, renting almost always wins due to transaction costs on purchase/sale.

[mustachioso]

I'd plan to stay for longer than 5 years.

I guess my biggest concern is that the 'what does the future hold' section can swing the results a lot.
If housing prices continue to rise at >10% per year it's really easy to justify spending hundreds of dollars more per month.

If you go by the ~30% take home pay, you can make that happen by adjusting how much you put down.

[arebelspy]

I guess my biggest concern is that the 'what does the future hold' section can swing the results a lot.

But shouldn't that be the case?

Shouldn't drastically different results in the future change what you should do?

I mean, if you had a crystal ball that was accurate and said the stock market was going to crash next week, or it was going to soar and not crash for 5 years, shouldn't that affect what you do?

It makes sense to me then that a "what does the future hold" section can swing results a lot.

Now given that you don't have an accurate crystal ball, you just have to do the best you can to pick a reasonable assumption and go off that.  Or else pick what you think is a low end, and a high end, and assume the reality will be somewhere in-between.

[waltworks]

That's why you run multiple scenarios to see more about other possibilities than just the default one.

I mean, you could get hit by a meteor in the next 5 minutes. Welcome to the real world, where the future is unknowable. Do your best to plan for most plausible scenarios and don't worry about the meteor.

-W

I'd plan to stay for longer than 5 years.

I guess my biggest concern is that the 'what does the future hold' section can swing the results a lot.
If housing prices continue to rise at >10% per year it's really easy to justify spending hundreds of dollars more per month.

If you go by the ~30% take home pay, you can make that happen by adjusting how much you put down.