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If you buy a house in the $227k range on a $55k income (With NO insurance and NO property taxes, the monthly payment would be ~$1,736.53), you will have to live

by Kurimo 10y ago

If you buy a house in the $227k range on a $55k income (With NO insurance and NO property taxes, the monthly payment would be ~$1,736.53), you will have to live very carefully to get by comfortably (considering $55k after federal/georgia taxes would net about $41,013.75, your monthly takehome would be $3,7k leaving you <$2k after mortgage, ignoring again insurance, property taxes, and other bills). Zillow and other home pushers are interested in selling houses, not in the consequences for the buyers thereafter.

runako 10y ago
I kind of figured that would be a pushback, but I wanted to use a reproducible source (nerdwallet is more aggressive than Zillow and comes up with a higher number). And per realtor.com ~$1800/mo is about right for all-in (insurance, tax, etc.) in the Atlanta area in that price range. All that said, in Atlanta, 3 BR/2 BA houses are abundant in the under-$150k range. Or under $100k. It's really not approaching necessary to earn 2x the median income in cities like Atlanta to buy a house with a yard. The point is the OP's math assumes one lives in a high-cost area, which is not the reality where most Americans live.
- falcolas 10y ago
  Not really, once you include the other costs of living (and having children). $1.8k housing, plus $500 for property taxes and insurance, $1,000 for two vehicles (payments, insurance (damned teenage drivers), gas, maintenance), $500 into savings for household emergencies, $800 to feed four, $100 per person for clothing, the occasional ice cream, paying off medical deductables... and you're quickly looking at needing over $5,000 a month gross just to get by. 5,000 / 0.7 * 12 = $85,000 Toss in 10% savings and 10% retirement, and you're well over $100,000. Sure, you can cut corners and live off a lot less than that, but I'm comparing it to the standard of living had by people 40 years ago.
  - runako 10y ago
    Right -- the $1,800 was inclusive of property taxes and insurance ("all-in"). And again -- there are great houses available for under half that ($900/mo all-in). (Random nitpick: if you're earning the median income, paying a mortgage while contributing to retirement; and have 2 kids, you are not paying anything close to 30% of your income in income taxes.) Also you are right that if you save ~30% of your median income ($500 + 10% savings + 10% retirement), the month-to-month gets a little tighter. But then you can retire early. :-) I'm not arguing that everything is roses, just that tens of millions of people live at the median income and own houses, cars, etc. You'd have done much better here arguing about the costs of childcare or higher education. Those are a bloodbath, no matter where you are.
slededit 10y ago
Where do your numbers come from? I bought a condo for $225,000 and the mortgage is $1,000 including property taxes and insurance. Even with Condo fees its still less than $1,300.

by Kurimo 10y ago

runako 10y ago

I kind of figured that would be a pushback, but I wanted to use a reproducible source (nerdwallet is more aggressive than Zillow and comes up with a higher number). And per realtor.com ~$1800/mo is about right for all-in (insurance, tax, etc.) in the Atlanta area in that price range. All that said, in Atlanta, 3 BR/2 BA houses are abundant in the under-$150k range. Or under $100k. It's really not approaching necessary to earn 2x the median income in cities like Atlanta to buy a house with a yard. The point is the OP's math assumes one lives in a high-cost area, which is not the reality where most Americans live.

falcolas 10y ago
Not really, once you include the other costs of living (and having children). $1.8k housing, plus $500 for property taxes and insurance, $1,000 for two vehicles (payments, insurance (damned teenage drivers), gas, maintenance), $500 into savings for household emergencies, $800 to feed four, $100 per person for clothing, the occasional ice cream, paying off medical deductables... and you're quickly looking at needing over $5,000 a month gross just to get by. 5,000 / 0.7 * 12 = $85,000 Toss in 10% savings and 10% retirement, and you're well over $100,000. Sure, you can cut corners and live off a lot less than that, but I'm comparing it to the standard of living had by people 40 years ago.
- runako 10y ago
  Right -- the $1,800 was inclusive of property taxes and insurance ("all-in"). And again -- there are great houses available for under half that ($900/mo all-in). (Random nitpick: if you're earning the median income, paying a mortgage while contributing to retirement; and have 2 kids, you are not paying anything close to 30% of your income in income taxes.) Also you are right that if you save ~30% of your median income ($500 + 10% savings + 10% retirement), the month-to-month gets a little tighter. But then you can retire early. :-) I'm not arguing that everything is roses, just that tens of millions of people live at the median income and own houses, cars, etc. You'd have done much better here arguing about the costs of childcare or higher education. Those are a bloodbath, no matter where you are.

slededit 10y ago

Where do your numbers come from? I bought a condo for $225,000 and the mortgage is $1,000 including property taxes and insurance. Even with Condo fees its still less than $1,300.