Discouraged future first-time home owner, any advice?

NEW -> Contingent Buyer Assistance Program
For most people the first 2 homes were big mistakes. Buying a home in a hurry during your 20's is a very big mistakes. I am saying this because I have been there. I have learned enough from my first 2 homes to write a book. Do not scrape by just to buy an attached product because you will eventually move. For each time you move you will lose money. Buy a run down detached home in a good area even when you have to fix it up and allow room for family growth. Patience=gold=Awgee
 
[quote author="stepping_up" date=1216110836]Have you written the book BK? I just know I would absolutely love reading a book you've written.</blockquote>


I have not but everyone has been asking me to write one. I have posted almost a thousand entries you can try the search button for some informative posts for the time being. My book title may just be "my chauffeur was a bus driver" or "The back seat of my car was the 36th row back above the motor"
 
<blockquote></blockquote>We moved to Woodbury Square almost a year ago and we absolutely love it here! We would love to buy a house in Irvine (Preferablly Orchard Hills, Portola Springs, Woodbury, or Quail Hill that?s about 750 to 800,000) but I?m not sure that is ever going to be possible. We really want to have a house by the time our daughter turns 5 (she?s 2 right now), we?re 29 right now, we make about 125,000 but we have some credit problems, 2 car payments, a couple credit cards and other payments plus crazy expensive daycare. Right now we are working on paying everything off and fixing our credit and plan to have everything paid off, decent credit and about 40,000 in savings in Fall of 2011<blockquote></blockquote>


OK, forgive me here, but the more I read this post, the more it irks me. I've had a particularly long and horrible Monday, so that may be coming out here, but what I see here is a couple who make $125K/yr, have debt, marred credit and no savings for a house yet to speak of, yet there is the belief here that you should be able to step into an SFR in a primo Irvine neighborhood if in the next three years you can pay off your debt and accumulate $40K in savings. $40K isn't a whole heck of a lot of money. Yes, prices are going to come down, but I also think there are expectations for what you should have that are not realistic based on where you are and where you need to get to with getting the financial house in order. We can't have it all right now, which is one of the basic tenets of economics... we are all striving for resources that are limited... there are opportunity costs associated with every choice we make and prioritizing the resources we most want is crucial.



I'm debating on posting this because it sounds harsh, but I'm going to post it anyway with a sign off that it's impressive that you are looking at increased earnings, paying off debt and getting a leg up on saving for the DP.
 
[quote author="stepping_up" date=1216111959]<blockquote></blockquote>We moved to Woodbury Square almost a year ago and we absolutely love it here! We would love to buy a house in Irvine (Preferablly Orchard Hills, Portola Springs, Woodbury, or Quail Hill that?s about 750 to 800,000) but I?m not sure that is ever going to be possible. We really want to have a house by the time our daughter turns 5 (she?s 2 right now), we?re 29 right now, we make about 125,000 but we have some credit problems, 2 car payments, a couple credit cards and other payments plus crazy expensive daycare. Right now we are working on paying everything off and fixing our credit and plan to have everything paid off, decent credit and about 40,000 in savings in Fall of 2011<blockquote></blockquote>


OK, forgive me here, but the more I read this post, the more it irks me. I've had a particularly long and horrible Monday, so that may be coming out here, but what I see here is a couple who make $125K/yr, have debt, marred credit and no savings for a house yet to speak of, yet there is the belief here that you should be able to step into an SFR in a primo Irvine neighborhood if in the next three years you can pay off your debt and accumulate $40K in savings. $40K isn't a whole heck of a lot of money. Yes, prices are going to come down, but I also think there are expectations for what you should have that are not realistic based on where you are and where you need to get to with getting the financial house in order. We can't have it all right now, which is one of the basic tenets of economics... we are all striving for resources that are limited... there are opportunity costs associated with every choice we make and prioritizing the resources we most want is crucial.



I'm debating on posting this because it sounds harsh, but I'm going to post it anyway with a sign off that it's impressive that you are looking at increased earnings, paying off debt and getting a leg up on saving for the DP.</blockquote>


Step,



I have very good restraint today by not insulting any one. I agree with you totally hoping to word my comments so the 1st time poster newbie would not be discouraged. Reality is still too far away for her but I have to give her credit for asking.
 
[quote author="bkshopr" date=1216111489][quote author="stepping_up" date=1216110836]Have you written the book BK? I just know I would absolutely love reading a book you've written.</blockquote>


I have not but everyone has been asking me to write one. I have posted almost a thousand entries you can try the search button for some informative posts for the time being. My book title may just be "my chauffeur was a bus driver" or "The back seat of my car was the 36th row back above the motor"</blockquote>


I LOVE the first title idea. Well written words on interesting subjects are great in all formats, but there's something about a book itself that can never be replaced by electronic collections. Your book would be one of the ones we keep on the shelf, so you can refer back to parts you particularly liked or easily share a passage with a guest, or even to lend to a friend for their pleasure. Your thoughts merit a real book.
 
To OP:

I know all too well the discouragement of not being able to buy right now.



Our situation:

Our household income is a combined $150K. We have no debts other than student loans and a low car payment. We have $40K toward a down payment now and we hope to save another $40K over the next year (we'll see). We have no kids and jobs that usually give nice bonuses and raises. Our credit is good.



Even so, we need a lot more cash and income to afford a moderately priced home in my hometown of Huntington Beach (around $600K-800K).

I find it sad that we can't afford to buy a house in the neighborhood I grew up in despite the fact that my hubby and I are doing well for our age (we are late 20's, early 30's). Because of this dumb bubble we have to put off buying a house and starting our family (we both want to have a house before we start down that road). Also, we have chosen to live in a smaller place to save on rent costs (we're always working anyways).



Nearly ten years ago, my parents were able to buy a house in a nice family friendly Huntington Beach neighborhood on one good income and while raising 4 kids. My dad was even able to put a small amount away for retirement.



We probably need at least $160K down, an income equal to 2x what we make now, and no money toward retirement if we want to own.



Le sigh....
 
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