Buy or wait?

[Lazeybones]

Brand new attending several months into my first job. Non-physician wife. No kids and not planning on having any.

- Combined income 350k with potential to increase slightly in the next couple years based on a variety of factors
- Student debt ~170k
- Current rent 3k/month
- We live relatively frugally with ~70% income going to student loans and savings

We're in a VHCOL area that we both enjoy. We have no strong ties to the region aside from some extended family, but very much like it here for multiple reasons. I like my job so far and the work-life balance is great (no call or weekends which is not common in my field). My only concern with the job is that patient volumes aren't where they should be yet, but I'm also building a new panel from scratch.

Decent starter homes (1500 sqft) around here are 850k minimum and we would aim for a home around that price.

I admit that I have serious FOMO. Housing in our region has increased by about 10% every year since 2012 and the market is insanely competitive right now. I worry that the longer we wait to pull the trigger, the less likely it is that we'll ever be able to afford a home here. The local job market here is strong and it's a highly desirable region. And interest rates are low.

We should have enough saved for a 10% down-payment by summer/fall of 2021 with mortgage therefore being ~2.5x gross.

Thoughts on buying in 2021 or waiting until 2022 (or even 2023) when we'd be in a better financial position ?

[Peds]

I think waiting a year till next year is a good plan

[JBME]

definitely wait a year. 10% for a down payment isn't really enough, and I know you are in a VHCOL area but still....$3k/mo in rent? you might be otherwise frugal, but that's not frugal

[Lazeybones]

definitely wait a year. 10% for a down payment isn't really enough, and I know you are in a VHCOL area but still....$3k/mo in rent? you might be otherwise frugal, but that's not frugal

Agreed, 3K is certainly more than I'd like to be paying for rent, but this was market rate for the area when we signed our lease. I may be able to negotiate a better rate next year as covid has driven down the rental market here.

Also, this is partly why I wonder if trying to buy a house earlier makes more sense as I'd only be paying slightly more for a housing payment with most of that going to equity rather than my landlord's pocket.

[Brains428]

I'd also wait a year. You're still in a honeymoon phase with the job and maybe location. You have the luxury of not having children, so you don't have to rush into this.

If you never plan on having children-- why even buy a house?

[billy]

in a VHCOL, 3 k isnt horrible for rent. I pay (gasp) 3500. But you should wait. Make sure job is stable and a good fit. You dont know that answer yet, but you will in another year. If job stays good, then go buy something.

[WorkforFIRE]

“Brand new attending several months into my first job. Non-physician wife. No kids and not planning on having any.

- Combined income 350k with potential to increase slightly in the next couple years based on a variety of factors
- Student debt ~170k”

that’s all I read from you post...you should wait. There’s no rush. Pay off debt. Build e-fund. Wait until you are on the job for at least 2 years. Live like a resident for 5 years.

[Codfish]

I’d wait. A 10% down offer in a VHCOL is not a competitive offer on a starter home. You’ll be outbid on a 50% down or all cash offer every time. Most homes in a VHCOL area end up in bidding wars with large escalation clauses or best and final second offers because inventory is so low right now.

[VagabondMD]

No, you should wait to purchase the Tesl-er, wrong answer.

It will not hurt to wait until you are in a better financial position with a greater sense of job stability before buying a house.

[Tim]

You are asking the question because you are uncertain (job, prices, financial position ).
Buy a house when absolutely certain. You have no need to own and ownership comes downsides. The plus is if you wait, you still buy if you want from a position of strength on all fronts.