High level premise:
What factors do you consider when to buy a home vs continuing to rent and save money/equity in other savings vehicles? How did you know when to switch from one to the other in current market conditions?
Current situation:
My wife and I (28F and 31M) have wrapped up our grad school programs (while working) and are expecting our second kid in August. Short-term, we will be moving in August to a larger rental home (3BR, 1.5B) to accommodate the expanding family. Long-term, now that we are done with school in the city we currently live in, we will be looking to move back towards a part of southeast U.S. that is closer to family (currently live 12+ hours drive from relatives, live in Northeast). We both want this, but I am a bit hesitant to making the jump into home ownership, whereas my wife would like to have something we can own and feel more comfortable staying more than a few years.
Most stuff I am seeing for our needs in some of the cities/suburbs we would consider is in the $250k-$400k range. With just a 20% down payment, monthly mortgage is going to be greater than our current housing costs, not including taxes, insurance, and general homeownership costs.
Summary of where we are at financially:
Annual income - $130k
No student debt (anymore)
Retirement savings - $275k
Down payment savings (brokerage) - ~$50k
Bank accounts (less CC) - $25k-30k
HSA - $30k
We currently max HSA, two IRAS, and do 10% for employer match for for 401k. After all taxes, medical and other deductions, we have about $5.3k monthly to budget. Our next rental is going to be $1900/month including all utilities and internet. With rent and our other current budget needs, we are saving about $800/month to the side for general savings goals (house down payment, second car, and possibly 529s).
Summary and original premise:
Personally, I would just as well keep renting and pushing our retirement accounts hard (and adding in some 529s) as well as save more for a down payment in a brokerage account, but my wife's point of view is that we have saved enough to scale back on retirement and that we are at the "next step" of our life in needing to invest in a home for our family.
How did you and your SO (if applicable) know when you make the switch in this current market climate from renting to ownership? What was it that made you know that you are ready to take on mortgage vs continuing to rent?
What factors do you consider when to buy a home vs continuing to rent and save money/equity in other savings vehicles? How did you know when to switch from one to the other in current market conditions?
Current situation:
My wife and I (28F and 31M) have wrapped up our grad school programs (while working) and are expecting our second kid in August. Short-term, we will be moving in August to a larger rental home (3BR, 1.5B) to accommodate the expanding family. Long-term, now that we are done with school in the city we currently live in, we will be looking to move back towards a part of southeast U.S. that is closer to family (currently live 12+ hours drive from relatives, live in Northeast). We both want this, but I am a bit hesitant to making the jump into home ownership, whereas my wife would like to have something we can own and feel more comfortable staying more than a few years.
Most stuff I am seeing for our needs in some of the cities/suburbs we would consider is in the $250k-$400k range. With just a 20% down payment, monthly mortgage is going to be greater than our current housing costs, not including taxes, insurance, and general homeownership costs.
Summary of where we are at financially:
Annual income - $130k
No student debt (anymore)
Retirement savings - $275k
Down payment savings (brokerage) - ~$50k
Bank accounts (less CC) - $25k-30k
HSA - $30k
We currently max HSA, two IRAS, and do 10% for employer match for for 401k. After all taxes, medical and other deductions, we have about $5.3k monthly to budget. Our next rental is going to be $1900/month including all utilities and internet. With rent and our other current budget needs, we are saving about $800/month to the side for general savings goals (house down payment, second car, and possibly 529s).
Summary and original premise:
Personally, I would just as well keep renting and pushing our retirement accounts hard (and adding in some 529s) as well as save more for a down payment in a brokerage account, but my wife's point of view is that we have saved enough to scale back on retirement and that we are at the "next step" of our life in needing to invest in a home for our family.
How did you and your SO (if applicable) know when you make the switch in this current market climate from renting to ownership? What was it that made you know that you are ready to take on mortgage vs continuing to rent?