How much house?

[cbmd81]

Not sure if this will be enough info to provide guidance but worth a try. We are a two physician household with about $700k combined gross income. We are 3 years out of training and have about $50k of student loan debt after paying down aggressively since training. We are starting to outgrow our house but love the neighborhood. There is a house we love a block away listed at $1.325. Can we afford this? Thanks!

[adventure]

How much of an emergency fund do you have?

How much of a down payment do you have?

How much equity do you have in your current house?

Are you willing to have such an increased payment?

Are you adding anything to retirement, at present?

Will this house be big enough until the kiddos are gone?

... those and more are good questions to keep in mind, but I'd guess you have the cashflow to make the payment (even at 10% down, 5% interest, thats what, ~$6,400/month), if you pull in ~58k/month gross. Better question is do all of the other pieces fit together with this too.

(I love our neighborhood, so I get the question!)

[jsr52]

There's people making way less living in 1.3 million dollar homes.

[Craigy]

Clearly you can afford it, but the better question is if it's worth it to you and your spouse.

[The White Coat Investor]

cbmd81 wrote:

Not sure if this will be enough info to provide guidance but worth a try. We are a two physician household with about $700k combined gross income. We are 3 years out of training and have about $50k of student loan debt after paying down aggressively since training. We are starting to outgrow our house but love the neighborhood. There is a house we love a block away listed at $1.325. Can we afford this? Thanks!

Click to expand...

Yes. You can afford it. Good job getting rid of those loans.

This, of course, assumes that both of you continue working.

If you don't live in a very HCOL area I wouldn't spend that much, but that doesn't mean you wouldn't.

[VagabondMD]

Buy as little house as your spouse will tolerate.

[q-school]

will it appreciate?  how easy would it be to sell if you needed to?

 

[PhysicianOnFIRE]

Sure, you can afford it, but as you've noticed, there are more questions than answers. I'm guessing you live in a high cost of living area, and that $1,325,000 is not an absurd amount to spend on a home. In many places, half that would buy a luxurious 5,000 square foot estate. But certainly not all.

We were able to buy a nice waterfront home that suits us for under $300,000. Thank you, geographic arbitrage. Questions about million dollar homes make my head spin.

[Zaphod]

PhysicianOnFIRE wrote:

Sure, you can afford it, but as you’ve noticed, there are more questions than answers. I’m guessing you live in a high cost of living area, and that $1,325,000 is not an absurd amount to spend on a home. In many places, half that would buy a luxurious 5,000 square foot estate. But certainly not all.

We were able to buy a nice waterfront home that suits us for under $300,000. Thank you, geographic arbitrage. Questions about million dollar homes make my head spin.

Click to expand...

ice front home?

[StarTrekDoc]

Sure; not an issue at 700k in isolation for affordability.

As folk mentioned - context is key -- Family? Kids? Dual income for how long and what is the split if reduced time/single income? Savings/Retirement/529 plan status?  If you spend that on house, also considering the expenses with that house --- along with the nice car too.

Even at 300k, one can swing the mortgage, but would be a lot more aggressive stance on house.

 

[PhysicianOnFIRE]

Zaphod wrote:

ice front home?

Click to expand...

at times, yes.

But it's a fast moving river, making the ice unpredictable and ice fishing unsafe. I have to go to my Dad's place for that, or any of a couple dozen docs I know that live on the lakes.