On the local FB sales group, sometimes people list houses for sale. I've seen houses on there for anywhere from 94k to 489k. Mostly they are between 110-40k.
On my income it has taken me roughly a year to save about 5k in my EF (the balance was already there, leftover from my moving fund/EF from NM.)
I pay $430/month in rent, plus between $50 - $100 in utilities. I put about 15% of my post-tax income in a ROTH (which doesn't even get close to maxing it out.)
So if I ever want to buy a house and have the payments be something I can manage on my income, I will probably need 40k+ for a downpayment, plus another 10 - 15k for closing costs, House EF/fix up.
At my current savings rate, that might happen ... oh 9 or 10 years from now? And that's assuming that the simple, not fancy houses (1000sq ft w/basement home for $138k type places) will not have gone way up in price.
And I'll probably be needing another car about that time too ...
I don't make minimum wage - but maybe close to 2x minimum wage. I don't have much in the way of extravagances - no cable tv, watch my pennies. I do have my iPhone and my Internet (which I cringe paying for - so expensive!) I'm also only supporting myself and my cat.
So ... how do people with families do it? How do they buy houses???
I was looking at the calculator for the 138k house, assuming a 20k down payment at 4.5% interest. My payment would be something like $900/month!! No way on God's green earth I could afford that and still save for retirement, or for car replacement, or have any extra left for once in a while vacations, or for home repairs ...
I guess it kind of makes me a bit discouraged. I know, I know ... I could get a teaching job making twice what I make here (or close to it.) But as stressful as the bus job is sometimes, it is only 40 hours a week and I'm done. Teaching .... just not the case. Plus a WHOLE nother level of stress.
--
PS - I have an ad for Sam's Club below. They just have to be advertising that they have Nutella on sale this month. Note to Laura - DO NOT ENTER Sam's Club this month.
Sometimes I wonder ..
July 5th, 2015 at 09:32 pm
July 5th, 2015 at 10:10 pm 1436134221
If I were in your situation I'd consider and run numbers for other scenarios where you maybe save less for retirement for a period of time, save less for a down payment and consider increasing your income. Yes, there are jobs for call centers, insurance specifically, that would pay likely pay more.
July 5th, 2015 at 10:18 pm 1436134731
For me I guess I'm kind of torn. I desperately want out of the rat race, want to retire as early as humanly possible. At the same time though when I see these houses for sale and think about how amazing it would feel to be a home owner .. but then I think of the reality of the numbers, and just don't see how I'll be able to do both. At least not on my income alone.
The 10k is closing costs, but also money for curtains, any minor fix ups that might be needed, furnishings, etc., etc., etc. The houses in the 130s range are older homes ...
July 5th, 2015 at 10:24 pm 1436135049
July 5th, 2015 at 10:28 pm 1436135321
July 5th, 2015 at 10:32 pm 1436135571
July 5th, 2015 at 10:35 pm 1436135734
July 5th, 2015 at 10:39 pm 1436135974
July 5th, 2015 at 11:14 pm 1436138078
I'm sure there are condos there somewhere. There are really small homes around there you might be able to get for less. Would you consider a roommate?
July 5th, 2015 at 11:23 pm 1436138587
I could live with a roommate, although that would probably mean needing to hire a housekeeper/cleaner so I wouldn't drive them nuts with my err... housekeeping.
People calling into insurance call centers don't use foul language or complain or just call to ramble on about something or the other?
July 6th, 2015 at 04:53 am 1436158396
http://nifa.org/programs/programs.html?pi=428&search_var=prog&prog_name_sent=single+family
The programs have silent seconds or grant money given to a hoeme buyer. It sometimes is income dependent but in CA a single person, no kids, can have a salary up to $84k and still get 5% down pay assistance. And 20% is nice but loans can start with as little as 3% (but sometimes permanent PMI and would need to be refinanced to get rid of PMI). There are also USDA loan for home and it does not mean you need to be a farmer or has property just that it is purchased in a specific mapped area-there are areas all over.
There are many ways to get help. Talk to the Nebraska organization and a mortgge broker to learn more about your options. It is possible to buy a home just do some more research!
July 6th, 2015 at 07:42 am 1436168557
July 6th, 2015 at 10:45 am 1436179541
July 6th, 2015 at 01:36 pm 1436189790
But it has 3 bedrooms, 3 1/2 baths, family room, laundry room, garage, mountain view and on a creek. They are putting down 5%.
Closing costs were estimated at $7000 thru the bank, but I think now that i am financing, they will be less than 1/2 that. (I will let everyone know) I am paying the closing costs because the couple has to stretch to come up with 5% ($12,500) I am holding the mortgage at 4 1/2 % for 25 years.
Maybe you could find someone to hold the mortgage.
It is nice to get a brand new house with No fixer up problems.
July 6th, 2015 at 02:31 pm 1436193061
July 7th, 2015 at 02:30 am 1436236259
July 7th, 2015 at 11:45 pm 1436312717
I think it can make a great deal of sense to buy without 20% down in some situations. Renting for 9 or 10 years while saving up a down payment costs more than PMI.
July 7th, 2015 at 11:50 pm 1436313054
July 10th, 2015 at 10:57 am 1436525872
July 10th, 2015 at 02:30 pm 1436538642
So to put things in perspective, many people who make far more, still have far less. So what do we do? What we can. We live in our co-op apartment, paying off mortgage and building equity, and later, if we ever decide to move some place else, we could sell and apply that equity to buy a house with land somewhere. At least we will have that option. Or, if we put over 500K downpayment, perhaps move into a bigger apartment in Bronx (or a much smaller one on Manhattan). Sounds crazy, but no matter how many times you call it crazy, reality is not going away. *sigh* But in general, I think the goal is to be in a better financial position as years pass.
July 11th, 2015 at 02:50 pm 1436626250
I don't really agree with this idea, but a lot of people I know around me does just that. The bottom line is, having a house is expensive no matter what you do.
It's also why I have looked into admittedly fairly extreme methods of avoiding ever having a mortgage, such as vandwelling. Hey, doesn't hurt to look into things, right?
July 11th, 2015 at 03:27 pm 1436628455
As much as I do want a house, I do also want to wait a few years to make SURE I am settled here (as well as to see what actually happens in the future with NE.)
In the meantime I'll probably continue my savings as is, although may increase my ROTH savings. I figure when the time comes where I truly feel ready/truly settled, I can always take money out of my ROTH without tax consequences if necessary. I'll be getting a raise (cost of living/union contract renegotiation) in August which I think goes into effect in September - so will probably bump my ROTH by $50/month.
I will definitely keep my eye out for other job opportunities, however I have to be here for 3 years to be 100% vested. My employer puts in 9% of my salary per paycheck into the retirement plan, and I put in 7% (mandatory - not sure if this can be increased or not. So that would be a lot of money to walk away from if I left before 3 years (not sure if it is 3 years total, or 3 years from the time the plan started -which makes more sense.)
July 11th, 2015 at 08:45 pm 1436647545
July 11th, 2015 at 08:51 pm 1436647897
It is a city job. Yes, I'll have been there a 1 year as of August 4. I do look at the job listings for the city each week in case something comes up that looks like a *really* good fit for me. I wouldn't want to apply to something without being pretty sure I could get it, when the info might get back to my boss. I really do like my boss, but I think she'd understand if I left for better money or something more interesting. If I found something like that, then I'd go for it. Otherwise I will wait til the 3 years/vested unless something *extraordinary* comes up - pay/benefits/interesting/rewarding which would make losing the vested amount worth it.
July 25th, 2015 at 03:10 am 1437793842
July 26th, 2015 at 12:36 pm 1437914218
I think the roommate and condo ideas are good ones, and I think you could satisfy your longings now with container gardening. I may go back to that myself even though i have an acre and a half here. It's just becoming too much to maintain.
July 26th, 2015 at 12:40 pm 1437914410
A good metaphor would be packing to go away on a camping trip. Whether you go for 2 days or 2 weeks, you still have to pack all the same essentials, like the tent, TP, flashlight, sleeping bags, etc.