how much can we afford a house?

G

gld2

New member
Just for discussions,  if  a family makes $100K with 2 kids,  how much can they afford for a house?  what price range of house shall they buy?  what price range will maximize the tax benefit?

                      if a family makes $200K with 2 kids,  how much can they afford for a house?  what price range of house shall they buy?  what price range will maximize the tax benefit?

                      if a family makes $300K with 2 kids,  how much can they afford for a house?  what price range of house shall they buy? what price range will maximize the tax benefit?







 
i think how much a family spends to maintain their standard of living they are comfortable with is the deciding factor rather than how much money is coming in (ie annual income)...

some dude making minimum wage can save up more each year then someone on wall street making 200k a year but burns 99% of it on booze n hookers... instead of living paycheck to paycheck, they have a saying where u live bonus to bonus...

annual income is bullshit when uncle sam takes 50%... when i hear someone is "salaried" at 1m a year, i automatically assume he/she is just making 500k... but if i hear some company is making 1m a year, shit if they have a holdings company in the caymans romney style then that company is making anywhere from 3-10m a year...

also are u assuming ur a w-2 earner? or a schedule C earner? vastly different here since u can write off a butt load of stuff on the schedule C but u cant write off crap on a w-2... or are u one of the rare ones that maxes out everything with a w-2 AND a schedule C? if u are, then i commend and envy u... ur well on ur way to becoming rich n famous haha
 
This question is impossible to answer, too many variables.  Some ppl are willing to give up other things (vacations, entertainment) to live in their "dream" house.  Others wanna save as much as possible.  Some ppl have more expenses than others...etc.  in the end, it's whatever you're comfortable paying.  Sorry for the cop out answer, but we need more info.
 
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably say vacation at least once a year (not saving to death :p),  regardless W2 or C etc, everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
 
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
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Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though). 
 
USC,  I knew so many people buy more than 5x time their annual gross income,  they still live very comforably

USCTrojanCPA said:
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
Click to expand...
Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though).
Click to expand...
 
gld2 said:
USC,  I knew so many people buy more than 5x time their annual gross income,  they still live very comforably

USCTrojanCPA said:
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
Click to expand...
Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though).
Click to expand...
Click to expand...

100k take home income? so after taxes... that assumes ur w-2 shows something more like annual salary of 190-200k... lol u can afford quite a bit of house there with our current interest rates haha
 
gld2 said:
USC,  I knew so many people buy more than 5x time their annual gross income,  they still live very comforably

USCTrojanCPA said:
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
Click to expand...
Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though).
Click to expand...
Click to expand...

u mean 5x pretax income to buy a combination of multiple properties and rent them out or all their eggs in one basket style?... little risky there 5x if all eggs in one basket :-\ but thats just me since im risk adverse... how do they have fun money to fuck arnd with and invest in other things?
 
USCTrojanCPA said:
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
Click to expand...
Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though).
Click to expand...

I would say 3x times your annual gross income. 
 
gld2 said:
USC,  I knew so many people buy more than 5x time their annual gross income,  they still live very comforably

USCTrojanCPA said:
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
Click to expand...
Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though).
Click to expand...
Click to expand...
There are a lot of variables that go into it so I'm sure there are people who can buy 5x times their income and still be comfy. 
 
homer_simpson said:
USCTrojanCPA said:
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
Click to expand...
Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though).
Click to expand...

I would say 3x times your annual gross income. 
Click to expand...
I would agree if rates were 5%-6%, not around 3.25% to 3.50%.
 
homer_simpson said:
world chaos said:
yeah but he has 2 kids... kind of risky there...
Click to expand...
Yeah that is what I was hinting toward.  3x your total income when you have 3 other mouths to feed besides yours.
Click to expand...

If I am understanding you guys correctly... if you have 100k take home (post tax) you can only afford a 300k house???
 
nonono... sorry... i just realized i typed wrong in my previous post by adding "after tax" in the same sentence... ill correct it now

he didnt answer my pre or post tax so im assuming they are talking about pre-tax
 
still... 3x is pretty low.. lets say it's 200k pretax.. you guys believe with 2 kids you should only buy a 600k house?
 
i do... i rather have extra money to invest elsewhere (my business, my fiances business, other real estate, etc)... again im really fiscally conservative and i live way below my means ... its something im willing to compensate so my money is working hard for me and not being sucked into my primary residence (money trap) which is extremely vulnerable to the whims of the economy (no diversification)...

to me thats the only way i know how i can move out of the middle class and into the upper class, otherwise ill remain middle class forever
 
YES,  5 x Pretax

world chaos said:
gld2 said:
USC,  I knew so many people buy more than 5x time their annual gross income,  they still live very comforably

USCTrojanCPA said:
gld2 said:
I understand there are lot of variables.  Let's just assume:  20% down,  2 kids,  living comfortably (not saving to death :p),  everything else all same.  what is the best price range to maximize the tax benefit?  What are the price can a family afford with income of $100K, $200K or $300K?
Click to expand...
Good rule of thumb would be buying a home no more than 4x times your annual gross income with our current interest rates (obviously this is not a hard and fast rule though).
Click to expand...
Click to expand...

u mean 5x pretax income to buy a combination of multiple properties and rent them out or all their eggs in one basket style?... little risky there 5x if all eggs in one basket :-\ but thats just me since im risk adverse... how do they have fun money to fuck arnd with and invest in other things?
Click to expand...
 
No, pretax

Crispy3 said:
homer_simpson said:
world chaos said:
yeah but he has 2 kids... kind of risky there...
Click to expand...
Yeah that is what I was hinting toward.  3x your total income when you have 3 other mouths to feed besides yours.
Click to expand...

If I am understanding you guys correctly... if you have 100k take home (post tax) you can only afford a 300k house???
Click to expand...
 
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