Back in the day, when I bought my first home to live in-Miami in the early 1990s-first mortgages with rates of 8 to 9% and 9% to 10% were common. It's a reality that we might never see 3% rates again. If sellers need to sell, home prices will likely have to drop, leading to lower appraisals. I'm pretty sure many others share these thoughts with me.
I agree, It's not just the prices, but also the increasing interest rates that are making it more difficult for people to afford homes. With a good FA you can make up your portfolio.
A lot of folks downplay the role of advisors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for license advisors and came across someone of due diligence, helped a lot to grow my reserve notwithstanding inflation, from $275k to approx. $850k so far.
How can one find a verifiable financial planner? I would not mind looking up the professional that helped you. I will be retiring in two years and I might need some management on my much larger portfolio. Don't want to take any chances.
Sonya Lee Mitchell is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..
As someone in their mid 20s making 78k in California, this is so defeating. I feel like I’ll never be able to afford a home even though I’m saving 60% of my income
@@And33146I feel you man. Just do your best to not get into student debt. Or get into as little as possible. Work your way through college and live below your means. You got this 💪🏽
@@Comm0ut what a silly comment . Decisions like that aren’t as black and white as you make it out to be. Although I’d like them to be. When everyone you love (huge family) including your fiancé lives in California most people wouldn’t move. Being around people I love and feeling fulfilled is worth waiting a few extra years to sacrifice more, increase income and saving a down payment for me. I’d argue being willing to do sacrifice for longer than you’d need to in other states is the opposite of weak. “Weak” is clearly subjective.
Same but it makes sense honestly hell even 50k in my area can't even get an apartment on that salary anymore Realistically if you have a college degree I cant imagine you'd be working a job or could realistically afford to work a job making that much with a car note , credit cards, student loans
@@LadyUpstart i dont think the DP would be the issue more like the mortgage is. Ex. With your theory i could afford a 500k house DP with my savings but mortgage most likely will be 1200$+ monthly which with salaries of 40k i think is kind of unreachable
@@TheAndyzilla at 40k a year, you can not afford a 500k house. I'm starting to understand how slow people are. You are not the target market audience for those houses. They are speaking to and about the upper class. There are plenty of house under 300k. They are not luxurious. They are regular basic houses. Or you can do what the older generations before us did and buy a fixer upper house and turn it into the houses you are envious of.
@@LadyUpstart from my savings and your 3% down payment i could. And thats my emphasys on "in theory". Talk about slow.. and a fixer upper house most like the cost of repair is as much or even higher than buy a new one lol
And don’t forget that if you are self employed they use your net income, not your gross. So here comes the mobile home park, except no one will finance rhat either. I went to grad school so I could afford live in more long term stability. But by the time I graduated, inflation and interest rates moved all those “finish lines” more than further ahead, they disappeared into thin air.
It’s not just interest rates that can affect how much home you can afford, but also property taxes and HOA (if the house has it or not) as well. And also, how much down payment you plan to put in (which will have a direct effect on monthly mortgage).
Debt/income ration is unrealistic. Nowadays, just by paying student debt and used car loan alone is roughly $1000 for a new grad. Also, for the middle-career average "aggressive" example, how come someone making ~7k post-tax can afford a mortgage of almost 6k monthly?
Ignore the max, live below your means, refuse to live in an expensive area or to make excuses for staying. Life is about money which enables freedom of choice.
What about property taxes and insurance? Wouldn’t those lower the amount of the monthly payment available for debt? Or do these rules assume one can afford those in addition to the mortgage payment?
You need to make 160K to afford a $400k home which is the average price right now within the US. That means if two people are living together you both have to make 80K each in order to afford the home. Understand just because you qualify for mortgage does not mean you can afford the house.
where are you getting these numbers? genuinely asking - i don't have a home and earn significantly less than that but I'm just wondering how you got that calculation? let's say you took a FHA loan at 6.5% and it's a 400k total mortgage (not even home price), at a 1.2% property tax rate which is pretty standard that's 3.8k a month including insurance, fha insurance, property tax etc. My cost of living not including housing at the moment is around 2k dollars a month, and i know that's on the lower end but I do own a car and we're raising a dog so it's not that blown out of proportion, but even if you multiply that by 1.5 (quite a lot) that's still 3k a month. you're up to 7k a month (96k a year). Married filing jointly brings in over 9k in most states at 160k salary. that leaves 2k at the higher cost of living per month, and even if taking just the standard deduction later at 25k that's an additional 6-7k but with a mortgage like that you can get it higher. Maybe I'm just optimistic but those numbers look pretty good to me. saving 30k a year and that's with a 400k mortgage, not a 400k house, with today's insane interest rates which are expected to drop this year. If i made any mistake on calculations feel free to call me out on them. This does not include fixing up the house or any of that stuff which does cost significant money (at a 400k home that's around 10k a year on the high end)
@@dirtymike3329 well good for you. I guess my sentence or response is not good for you since you’re a teacher all of a sudden. Good luck buying things you can’t afford and financing your entire life. I can make a video if I wanted to I don’t. Have a good life.
You can’t afford 400k on 160 hate to break it to ya we make around that and while it would be possible would be house poor I’m with you people don’t take into account being able to retire on day etc
Question on the Barclay AAdvantage Aviator Mastercard: Can you earn an additional bonus after a certain period (24 or 48 months)? I've had this for 2+ years, and it would be great if I can just get the additional miles! Thanks.
The problem with using rules like this is it only works for people who make enough to buy a house. My husband and i make between 40-60k a year, so we wouldn't be able to afford a house at all by this math, but that means we also couldn't afford rent. Honestly, all we have to make sure is the mortgage is the same as our rent or less and we'll be better off buying because the rent won't go up every year.
Question, when will my credit start to build back up? I experienced a massive dip on my credit score (51 points) in November 2023. My credit utilization went from its typical 0-1% to 11% when I forgot to pay my balance on the statement close date. That combined with opening a chase freedom unlimited card (2nd credit card) caused the dip. It’s been 2 and a half months and my score hasent changed.
I can’t say for sure. But a dip from high utilization and a hard pull shouldn’t leave your credit score permanently lowered. I can swing 15-30 points from month to month if that helps give some perspective!
So what you’re saying is a ton of homeowners from Covid are now living in places they could never afford nor have the income to support the new normals. Life poor. House rich. They will be offloading the houses when things get horrible as they don’t have the cash to float the “new norm” of living as sometimes even maintaining an old house breaks the bank for a lot of folks. And or they let it rot so over 20 years the house is worthless but the land. You start to see this in Hawaii where the cost of living far outpaces actual take home. Few actually do regular sainting the house and they end up dilapidated and the land is only any value as paying for tradesmen here is like paying for a Beverly Hills dentist
Why do we assumed that if someone is making more money that they hold more monthly debt? Holding credit cards with 20% plus interest will rob you of future wealth. Pay your credit cards off first and then think about buying a house!
I like it but I would like to see median salary’s and how to make something like that work because I believe that’s like 50k in most places and maybe I’m poor but I don’t know many 150k normal people
There are plenty of affordable houses that are just not on the costal areas of the US. Iowa, Wisconsin, Illinois, Nebraska ect. Sorry you aren't on the beaches but no one demanding affordable housing in the Hamptons.
Back in the day, when I bought my first home to live in-Miami in the early 1990s-first mortgages with rates of 8 to 9% and 9% to 10% were common. It's a reality that we might never see 3% rates again. If sellers need to sell, home prices will likely have to drop, leading to lower appraisals. I'm pretty sure many others share these thoughts with me.
I agree, It's not just the prices, but also the increasing interest rates that are making it more difficult for people to afford homes. With a good FA you can make up your portfolio.
A lot of folks downplay the role of advisors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for license advisors and came across someone of due diligence, helped a lot to grow my reserve notwithstanding inflation, from $275k to approx. $850k so far.
How can one find a verifiable financial planner? I would not mind looking up the professional that helped you. I will be retiring in two years and I might need some management on my much larger portfolio. Don't want to take any chances.
Sonya Lee Mitchell is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..
I searched her up, and I have sent her an email. I hope she gets back to me soon. Thank you
Mid career making 150k a year??? My dude over 90% of the population will NEVER make anything close to that.
Uhaul sells some medium sized boxes that fit my budget and a few of my belongings.
And some even come with wheels!
Son i can afford a cardboard box
A nice cardboard box lol
Insulated cardboard box or not?
@luiscristianfloresgarcia8319 yes with that thin layer of foam usually used to protect tv screens lol
... but not the land to put it on D:
🤣🤣
As someone in their mid 20s making 78k in California, this is so defeating. I feel like I’ll never be able to afford a home even though I’m saving 60% of my income
I’m a freshman in college and I’m stressing out, California is expensive 😭 especially in the bay area
@@And33146I feel you man. Just do your best to not get into student debt. Or get into as little as possible. Work your way through college and live below your means. You got this 💪🏽
MOVE. Stop wanting to live where your wallet says you should not want to live. Most people are weak by choice.
@@Comm0ut what a silly comment . Decisions like that aren’t as black and white as you make it out to be. Although I’d like them to be. When everyone you love (huge family) including your fiancé lives in California most people wouldn’t move. Being around people I love and feeling fulfilled is worth waiting a few extra years to sacrifice more, increase income and saving a down payment for me. I’d argue being willing to do sacrifice for longer than you’d need to in other states is the opposite of weak. “Weak” is clearly subjective.
70k base line? Aight imma head out, ill go live under a bridge
Same but it makes sense honestly
hell even 50k in my area can't even get an apartment on that salary anymore
Realistically if you have a college degree I cant imagine you'd be working a job or could realistically afford to work a job making that much with a car note , credit cards, student loans
You absolutely can. Just take the math and figure out what you can afford. For a first time home buyer you only put down 3%
@@LadyUpstart i dont think the DP would be the issue more like the mortgage is. Ex. With your theory i could afford a 500k house DP with my savings but mortgage most likely will be 1200$+ monthly which with salaries of 40k i think is kind of unreachable
@@TheAndyzilla at 40k a year, you can not afford a 500k house. I'm starting to understand how slow people are. You are not the target market audience for those houses. They are speaking to and about the upper class. There are plenty of house under 300k. They are not luxurious. They are regular basic houses. Or you can do what the older generations before us did and buy a fixer upper house and turn it into the houses you are envious of.
@@LadyUpstart from my savings and your 3% down payment i could. And thats my emphasys on "in theory". Talk about slow.. and a fixer upper house most like the cost of repair is as much or even higher than buy a new one lol
Love the video. But I think the average debt/ yearly salary is way off. Auto prices are through the roof, not accounting for any other debts.
They never show incomes below 100k because people would lose there minds
The 3:3:3 rule should take taxes in consideration. Post tax salary may be vastly different for different slabs.
And don’t forget that if you are self employed they use your net income, not your gross. So here comes the mobile home park, except no one will finance rhat either. I went to grad school so I could afford live in more long term stability. But by the time I graduated, inflation and interest rates moved all those “finish lines” more than further ahead, they disappeared into thin air.
It’s not just interest rates that can affect how much home you can afford, but also property taxes and HOA (if the house has it or not) as well. And also, how much down payment you plan to put in (which will have a direct effect on monthly mortgage).
I guess I’m very conservative I’m in market and I’m not willing to go over 30% of my net for all of my debt a month anything more stresses me
Debt/income ration is unrealistic. Nowadays, just by paying student debt and used car loan alone is roughly $1000 for a new grad. Also, for the middle-career average "aggressive" example, how come someone making ~7k post-tax can afford a mortgage of almost 6k monthly?
Great video John! What website is that calculator on?
Ignore the max, live below your means, refuse to live in an expensive area or to make excuses for staying. Life is about money which enables freedom of choice.
What about property taxes and insurance? Wouldn’t those lower the amount of the monthly payment available for debt? Or do these rules assume one can afford those in addition to the mortgage payment?
Great points on taxes and insurance. And yes both are factored in
You need to make 160K to afford a $400k home which is the average price right now within the US. That means if two people are living together you both have to make 80K each in order to afford the home. Understand just because you qualify for mortgage does not mean you can afford the house.
where are you getting these numbers? genuinely asking - i don't have a home and earn significantly less than that but I'm just wondering how you got that calculation?
let's say you took a FHA loan at 6.5% and it's a 400k total mortgage (not even home price), at a 1.2% property tax rate which is pretty standard that's 3.8k a month including insurance, fha insurance, property tax etc.
My cost of living not including housing at the moment is around 2k dollars a month, and i know that's on the lower end but I do own a car and we're raising a dog so it's not that blown out of proportion, but even if you multiply that by 1.5 (quite a lot) that's still 3k a month. you're up to 7k a month (96k a year). Married filing jointly brings in over 9k in most states at 160k salary. that leaves 2k at the higher cost of living per month, and even if taking just the standard deduction later at 25k that's an additional 6-7k but with a mortgage like that you can get it higher.
Maybe I'm just optimistic but those numbers look pretty good to me. saving 30k a year and that's with a 400k mortgage, not a 400k house, with today's insane interest rates which are expected to drop this year.
If i made any mistake on calculations feel free to call me out on them. This does not include fixing up the house or any of that stuff which does cost significant money (at a 400k home that's around 10k a year on the high end)
I’ll listen to the guy making the video over someone who can’t type well enough to form a coherent sentence
@@dirtymike3329 well good for you. I guess my sentence or response is not good for you since you’re a teacher all of a sudden. Good luck buying things you can’t afford and financing your entire life. I can make a video if I wanted to I don’t. Have a good life.
You can’t afford 400k on 160 hate to break it to ya we make around that and while it would be possible would be house poor I’m with you people don’t take into account being able to retire on day etc
Question on the Barclay AAdvantage Aviator Mastercard: Can you earn an additional bonus after a certain period (24 or 48 months)? I've had this for 2+ years, and it would be great if I can just get the additional miles! Thanks.
Yes. I’ve had this card bonus more than once ;)
The problem with using rules like this is it only works for people who make enough to buy a house. My husband and i make between 40-60k a year, so we wouldn't be able to afford a house at all by this math, but that means we also couldn't afford rent. Honestly, all we have to make sure is the mortgage is the same as our rent or less and we'll be better off buying because the rent won't go up every year.
Just more evidence that first time home buyers are being priced out of home ownership.
Ok what can I get for 3 dollars as down payment?
Question, when will my credit start to build back up? I experienced a massive dip on my credit score (51 points) in November 2023. My credit utilization went from its typical 0-1% to 11% when I forgot to pay my balance on the statement close date. That combined with opening a chase freedom unlimited card (2nd credit card) caused the dip. It’s been 2 and a half months and my score hasent changed.
I can’t say for sure. But a dip from high utilization and a hard pull shouldn’t leave your credit score permanently lowered. I can swing 15-30 points from month to month if that helps give some perspective!
So what you’re saying is a ton of homeowners from Covid are now living in places they could never afford nor have the income to support the new normals.
Life poor. House rich.
They will be offloading the houses when things get horrible as they don’t have the cash to float the “new norm” of living as sometimes even maintaining an old house breaks the bank for a lot of folks. And or they let it rot so over 20 years the house is worthless but the land.
You start to see this in Hawaii where the cost of living far outpaces actual take home. Few actually do regular sainting the house and they end up dilapidated and the land is only any value as paying for tradesmen here is like paying for a Beverly Hills dentist
W..Who’s this average Joe graduating with a 70k salary? A tech grad in San Francisco?
They start at $90k
A lot of them start at 120k. I graduated in the Midwest with a Computer Engineering degree and got greater than $70k remote. It's definitely possible.
I’m an accountant in Texas & got that right out of my undergrad. It’s def possible
It’s a tad high agreed. But I had an entry level pharma sales roles right after I graduated, 50k base with 28k commission bonus. This was in 2016
Pta in northern california starting off around 60-65k salary and school is not too expensive.
What website is that calculator on ?????
In Canada it's $1m for a townhouse.
Yea with those prices I'm either renting till I die or leaving the US
talk about the Heter Iska to have 0 interest.... semantics in a way
Where can I find the website with the calculator?
Is the suggested mortgage referring to what’s paid to the bank as in PITI or just P
It’s PITI in the examples
Why do we assumed that if someone is making more money that they hold more monthly debt?
Holding credit cards with 20% plus interest will rob you of future wealth. Pay your credit cards off first and then think about buying a house!
This guy is living in lala land. Majority of people in America are making less than 50 thousand a year.
When is the chase sapphire preferred getting a better welcome bonus offer? Does anyone have a referral link
I don't know about a better welcome offer, but I can give you my referral like if you want the standard 60k going on right now
I wish I had a definitive answer for ya. It’s 60k most of the year and occasionally for a short period we see 80k. But I dont know when exactly
S tier video
I like it but I would like to see median salary’s and how to make something like that work because I believe that’s like 50k in most places and maybe I’m poor but I don’t know many 150k normal people
You just need to find a rich wife 😢
That’s a fair point!
So the 30/30 rule is perfect for today’s economy to😅😂
I just did the math and I can afford to live in my car 😂 looking for a roommate
🎉🎉🎉🎉
So the answer is no. Got it. 😅
There are plenty of affordable houses that are just not on the costal areas of the US. Iowa, Wisconsin, Illinois, Nebraska ect. Sorry you aren't on the beaches but no one demanding affordable housing in the Hamptons.
Agreed!
People have already done this video. Do something else
Unsubscribe instead of criticizing.
People have already left this comment. Leave something else.
Hello HYPERINFLATION America 😄
Im trying john 🥲....but it looks like i can only afford a teepee in somebodys mommas backyard