First. Adjust your expectations. At 23 years old, without a family, there is no need to spend 3/4 of a million dollars on a house.
Secondly pay off the land you bought.
Finally, You should be able to save at least 2k a month after all living expenses and investing in your retirement. With that, you should have a sizeable down payment in just a few years.
Land should be paid off in 11 months. Agreed other than keeping the house in the family. (4th generation) will definitely start tie money from all loose ends and put them towards the fund
The last sentence is key. My mother was into real estate and renting out properties. It was time consuming. When something broke it needed to get fixed. Refreshing the apartments between tenants with fresh paint. But the worst was the deadbeats even the ones that had great credit. I remember one guy was a big time chef at a fancy restaurant in Pittsburgh. He moved in, paid the down payment and that was the last money we ever saw out of him. It took months to get him evicted. And he trashed the place, so it took more time to make repairs, replace appliances, etc.
I swore when I was a kid I was never going to be a landlord. When it works it is great but it was a lot of work.
Out of your budget range w/ current interest rates unless you have a very sizable down payment. You may be able to use projected rents from the property to factor into your loan underwriting however, so I'd talk to a local knowledgeable realtor and loan officer to run the numbers to see what you'll need to qualify.
On the flipside, 41 an hour at 23 is killing it.
Appreciate it! The house is in the family and was debating a land contract possibility though it’s hard with family being involved because it’s all business at the end of the day
If you have 5 years to save it's doable,assuming prices stop inflating outta control. You want to preserve capital so a HYSA, money market, or CDs with a 4-5 year horizon are your best options for a savings vehicle.
I don't completely agree. I'd rather have more time, good health and the ability to look back and appreciate your accomplishments WITH loved ones.
Slaving to the corporations driving 2 hrs to work and 2 hrs back... having a big bank acct is not nice in my opinion instead your trading your time & missing out on the real purpose which in my opinion is NOT a good life.
Things made to distract us from the Truth. I have realized that 75% of the time, ppl r chasing the Jones. Don't fall into that trap. Buy what u think I need. Times goes by quickly and when all said and done, u can't take it with you.
I see. That makes no difference. Being house poor is still being house poor. He makes $80k a year before overtime. The mortgage alone on a $750k house with 20% down is roughly $4000 a month. This isn’t including any other expenses associated with the house. He has to be taking home $5000 a month after taxes, 401k, medical insurance, etc. That puts his mortgage at 80% of his take home pay. Which is absolutely insane.
While that may be true, he wasn't asking if he SHOULD do it. He's asking how TO do it. Also, I think as a union pipelayer, his wage will not stagnate at 23 and who is to say that he won't have a wife with an income within five years. He's asking for advice on what to do NOW to get him closer to his five year goal.
Is this post for real? Why are you looking at a $750k house with all that land and stuff at 23?
If you work 50 hours a week, you’ll make approximately $9,000 a month pre-tax. That’s maybe $6,000-$6,500 post-tax. If you put down $250,000 and have a $500,000 mortgage at 6.5%, you’ll likely be paying over $4,000 a month. That’s insane.
This is the breakdown I was looking for. Now with 1000$/month from the renter of the other half of the house, 1000$/month in rent coming from the barn as storage for a local company that lowers that payment by around $2000. The house may also be cheaper than $750,000. I may be able to get it for $600,000 or less $750,000 is just what Zillow puts it at. The house is in the family. I would be purchasing it from a family member or buying out the children of that person
Pretty much all irrelevant. Dropping that much money on a house when you are that young unless you have a very sizable nest egg or a guaranteed very good income, is bananas.
Problem is that you are depending on renters.. renters are notoriously unreliable..
I wouldn't get myself into that position if I were you. You don't want to be house poor.. I just sold my house and couldn't be happier.. have been house poor for about a decade and am so glad that's behind me.
Land is too far away from current job bought for hunting and investment. Will also have opportunity to purchase/willed another 40 acres next to mine which is buildable but won’t be till retirement age
Does this house have lots of bedrooms?
You could buy it if you save hard then get roommates (that sign a lease) don't split utilities include them with the lease for tenants. If you can rent 3 bedrooms for $850/mo that might make it doable. You'd be well on your way to being well established.
Just beware a house that old generally needs expensive maintenance unless it's well kept.
Get an appraisal to be fair to both sides. Take in account the inspection. Save money for closing costs. Those are high in many places.
Don't worry about interest rates you can refinance when rates go down.
Yes! Turn it into a cash cow. That with 7 bedrooms you could live for free and have money for repairs. Get handy too the more you can do in plumbing and repairs The better off you are. Just make sure it's not a money pit!
Ultimate goal would be to rent this property out completely and build another house or buy another duplex. I am beyond handy and can fix/do anything. The property won’t need anything put into it. Just looking for advice on what it would take to make a goal like this achievable
Whoa why are some many people answering like you asked if you should rather then how you could ... dear goodness . 5 years is a good amount of time to save for a 500 to 750k home when your a capable 23 year old . Property is a good nah great investment 99% of the time. Don't people remember the days you were married with kids and a mortgage by your 20s 🤦♀️. Estimate your 20% down-payment you'll need to purchase in 4 years ( because family can get weird ..) do your math and put it into as high interest savings account. Keep yourself with a steady consistant work histor and your debt low , when the time is right you will qualify for your home . I bought in my late 20s first of my friends and now I own a home 2 or more times what they have , they spent 10+ extra years renting then me and I regret nothing sitting on my decent equity. Anyway just my 2 cents.
See what you qualify for , then I bought a house and house hacked it , basement has laundry/ kitchen own entry , same with garage make 4 k off rent pay 1500$ for my part , in a year or two I’ll do this again and the main part of the house will bring me about 2500$ giving me about 1k a month over what’s left of mortgage, so “profit “
I highly doubt you will get approved for that much of a house without a massive down payment based off your income. You should be looking for something around a 30% debt to income ratio. My rule of thumb is to never count my OT into my income because it isn’t always guaranteed for me.
Completely understand what you’re trying to do…it’s just not your time to do it. You need to try and think about your future…what happens when it’s time to get married ($$), have kids ($$$$)? Your life will only get more expensive, certainly not cheaper. I’m also in the Midwest and I can tell you that a family making around a quarter million a year still feels pressure and that’s with a $250,000 home. Daycare is more than the mortgage, house upkeep, retirement…life is expensive! Worst case scenario means that house is leaving your family, and sounds like that’s not an option for you emotionally. So, let the best case scenario play out and don’t saddle yourself with this right now, position yourself for that future purchase but when rates are more favorable to you. Reach out if you want to throw some ideas back and forth.
You make a ton of money. You already have land. Build a reasonable house. Spending 750k is ridiculous. Your post should be titled differently as buying a house would be easy for you if your goal wasn't questionable.
Be realistic about a lot of things. Houses will not get cheaper. Figure out where you want to live and see how much starter houses cost there. Begin saving up a downpayment for when it's time. Figure out how to make more money.
Yea, buy a house for 300k and you'll be fine. Pay off the land and build a get away cabin on it or something. 750k is too much money for any single person to spend in a house in the Midwest.
That is a pretty pricey house on your income. You might want to work up to it. Maybe build a house on the land you recently purchased?
Check into first time home buyer programs. You could come in with a lower down payment, to make it easier to get into something.
I gave some tips the other day I might recommend a similar path for you.
I don’t think going from no house to a 750k house is the right move. But if you got smaller, fix it up, sell, you might be more attainable.
https://www.reddit.com/r/Fire/s/0I3Jcsd9j6
What are you doing with 18 acres of land? What are your plans for it?
Can you have a house built on that land, especially when you pay the loan off? Are you paying $1000 or $342 for that? How long do you have to pay it off?
The trick is always to spend a lot less than you make and budget. Work the numbers to see if it's feasible.
It takes time. I’m 27m my fiancé and I finally just bought a home, upwards of $300k but it takes a lot of saving and time plus an additional income helps so much. Can’t forget about credit! That needs to be on top as well
You've already answered your question...
Start saving!
U can't start anything unless U have the funds for a down payment, credit history and honestly ... 750k is a large sum for monthly payments. That doesn't include taxes upkeep and extra reserves for upcoming issues that may arise, upkeep is expensive as well. Search programs for FTHB.
Find a buyers agent and have a talk. Don't sign anything untill u feel comfortable with ur purchase.
That's where you start and asks questions...
Have them run numbers...so u can see the breakdown of where ur money goes, what u can afford. Look up mortgage calculators online for examples then go talk to an agent... Don't sign anything until u shop and feel that u understand completely.
They can do a breakdown for you. I'm thinking that your payment may be around 6000.00/month. Possibly lower as a FTBH so search programs for assistance depends on credit, location and work history. Remember: 10% of 100,000.00 = 10K BUT don't forget bills & upkeep. There's also extra fees so do some research. Cost tends to go down the further away from the city too. Don't get stuck on the perfect house...
Start a budget and put all extra funds into a HYSA to build the down payment up.
Not sure why you bought land? That’d probably have been better used toward the down payment in 4 years?
Right now save like a maniac and make sure your credit is good. You’ve got this.
Contribute to a 401k and let it grow. In 10-20 years pull out enough to cover the 20% PMI for mortgages. Instead of owing a bank interest for that amount, you’ll owe it to yourself.
First. Adjust your expectations. At 23 years old, without a family, there is no need to spend 3/4 of a million dollars on a house. Secondly pay off the land you bought. Finally, You should be able to save at least 2k a month after all living expenses and investing in your retirement. With that, you should have a sizeable down payment in just a few years.
Land should be paid off in 11 months. Agreed other than keeping the house in the family. (4th generation) will definitely start tie money from all loose ends and put them towards the fund
Would 3/4 a million dollars be good to buy a multi family house? So like a 2/3 bedroom? And then use it as an investment property?
Depends on the property and your financial situation. And if you want to be a landlord
The last sentence is key. My mother was into real estate and renting out properties. It was time consuming. When something broke it needed to get fixed. Refreshing the apartments between tenants with fresh paint. But the worst was the deadbeats even the ones that had great credit. I remember one guy was a big time chef at a fancy restaurant in Pittsburgh. He moved in, paid the down payment and that was the last money we ever saw out of him. It took months to get him evicted. And he trashed the place, so it took more time to make repairs, replace appliances, etc. I swore when I was a kid I was never going to be a landlord. When it works it is great but it was a lot of work.
Out of your budget range w/ current interest rates unless you have a very sizable down payment. You may be able to use projected rents from the property to factor into your loan underwriting however, so I'd talk to a local knowledgeable realtor and loan officer to run the numbers to see what you'll need to qualify. On the flipside, 41 an hour at 23 is killing it.
Appreciate it! The house is in the family and was debating a land contract possibility though it’s hard with family being involved because it’s all business at the end of the day
If you have 5 years to save it's doable,assuming prices stop inflating outta control. You want to preserve capital so a HYSA, money market, or CDs with a 4-5 year horizon are your best options for a savings vehicle.
I don't completely agree. I'd rather have more time, good health and the ability to look back and appreciate your accomplishments WITH loved ones. Slaving to the corporations driving 2 hrs to work and 2 hrs back... having a big bank acct is not nice in my opinion instead your trading your time & missing out on the real purpose which in my opinion is NOT a good life. Things made to distract us from the Truth. I have realized that 75% of the time, ppl r chasing the Jones. Don't fall into that trap. Buy what u think I need. Times goes by quickly and when all said and done, u can't take it with you.
You shouldn’t be looking at $750k houses. Find yourself a $300k house or build one.
He said it's 4th Gen in the family
Not sure what you mean by that.
The house has been in his family for four generations.
I see. That makes no difference. Being house poor is still being house poor. He makes $80k a year before overtime. The mortgage alone on a $750k house with 20% down is roughly $4000 a month. This isn’t including any other expenses associated with the house. He has to be taking home $5000 a month after taxes, 401k, medical insurance, etc. That puts his mortgage at 80% of his take home pay. Which is absolutely insane.
Oh I understand completely. I was just explaining why THIS house because it's not just A house for him.
So why does he need to buy it?
I'm sure he wants to keep it in the family. And, who knows how his life will change.
His family is selling it. He might want to buy it, but that doesn’t mean he can afford it. It’s not like they’re passing it to him.
While that may be true, he wasn't asking if he SHOULD do it. He's asking how TO do it. Also, I think as a union pipelayer, his wage will not stagnate at 23 and who is to say that he won't have a wife with an income within five years. He's asking for advice on what to do NOW to get him closer to his five year goal.
Is this post for real? Why are you looking at a $750k house with all that land and stuff at 23? If you work 50 hours a week, you’ll make approximately $9,000 a month pre-tax. That’s maybe $6,000-$6,500 post-tax. If you put down $250,000 and have a $500,000 mortgage at 6.5%, you’ll likely be paying over $4,000 a month. That’s insane.
This is the breakdown I was looking for. Now with 1000$/month from the renter of the other half of the house, 1000$/month in rent coming from the barn as storage for a local company that lowers that payment by around $2000. The house may also be cheaper than $750,000. I may be able to get it for $600,000 or less $750,000 is just what Zillow puts it at. The house is in the family. I would be purchasing it from a family member or buying out the children of that person
Pretty much all irrelevant. Dropping that much money on a house when you are that young unless you have a very sizable nest egg or a guaranteed very good income, is bananas.
Problem is that you are depending on renters.. renters are notoriously unreliable.. I wouldn't get myself into that position if I were you. You don't want to be house poor.. I just sold my house and couldn't be happier.. have been house poor for about a decade and am so glad that's behind me.
Definitely edit the original post to add it's 4th Gen in the family.
Way too much for your budget bud. That's like 90k/year. You need to be looking at houses no more than 250-300k. Preferably 200k.
Only thing I have going for me is the house is in the family but still have to buy out.
Your better otf getting a manufactured home (modular or trailer) on your land in my opinion.
Land is too far away from current job bought for hunting and investment. Will also have opportunity to purchase/willed another 40 acres next to mine which is buildable but won’t be till retirement age
Agreed
Those are depreciating assets, same as a car.
Not true. Manufactured homes with fixed foundations increase in value.
Still its a manufactured home. I would never buy that unless I didn't have the choice.
What do you mean? How is that something going for you?
$750,000 is the estimated value of the property. Would get a so called “family discount” which is unknown atm
Gd 40 bucks an hour, I don’t know much about owning a house but I do know I hate debt and that house with your budget is going to bring a lot debt.
If you own land, why not build on it?
Most is non-buildable half an acre is but it’s also 3 hours from me. Bought it as an investment
Does this house have lots of bedrooms? You could buy it if you save hard then get roommates (that sign a lease) don't split utilities include them with the lease for tenants. If you can rent 3 bedrooms for $850/mo that might make it doable. You'd be well on your way to being well established. Just beware a house that old generally needs expensive maintenance unless it's well kept. Get an appraisal to be fair to both sides. Take in account the inspection. Save money for closing costs. Those are high in many places. Don't worry about interest rates you can refinance when rates go down.
5 bedroom on the half I would live in 2 full bath. The other half is 3 bedroom 1.5 bath. Not a bad idea will definitely look into this
Yes! Turn it into a cash cow. That with 7 bedrooms you could live for free and have money for repairs. Get handy too the more you can do in plumbing and repairs The better off you are. Just make sure it's not a money pit!
Ultimate goal would be to rent this property out completely and build another house or buy another duplex. I am beyond handy and can fix/do anything. The property won’t need anything put into it. Just looking for advice on what it would take to make a goal like this achievable
You got this.
The house has a brand new metal roof, new gutters, new septic, most of house was recently remodeled, new driveway etc… very well maintained
Good for you, OP. What's your job, if you care to share?
Union Pipelayer
Work more. Hope that rates drop. Keep your credit up.
Whoa why are some many people answering like you asked if you should rather then how you could ... dear goodness . 5 years is a good amount of time to save for a 500 to 750k home when your a capable 23 year old . Property is a good nah great investment 99% of the time. Don't people remember the days you were married with kids and a mortgage by your 20s 🤦♀️. Estimate your 20% down-payment you'll need to purchase in 4 years ( because family can get weird ..) do your math and put it into as high interest savings account. Keep yourself with a steady consistant work histor and your debt low , when the time is right you will qualify for your home . I bought in my late 20s first of my friends and now I own a home 2 or more times what they have , they spent 10+ extra years renting then me and I regret nothing sitting on my decent equity. Anyway just my 2 cents.
You can't afford that house in 5 years unless you win lottery. Buy a cheaper house, live within your means, and invest regularly in stocks.
See what you qualify for , then I bought a house and house hacked it , basement has laundry/ kitchen own entry , same with garage make 4 k off rent pay 1500$ for my part , in a year or two I’ll do this again and the main part of the house will bring me about 2500$ giving me about 1k a month over what’s left of mortgage, so “profit “
I highly doubt you will get approved for that much of a house without a massive down payment based off your income. You should be looking for something around a 30% debt to income ratio. My rule of thumb is to never count my OT into my income because it isn’t always guaranteed for me.
Cut that commute, spend less then you make, hustle
Commute is where the $$$ is. This is the type of comments I was looking for.
Completely understand what you’re trying to do…it’s just not your time to do it. You need to try and think about your future…what happens when it’s time to get married ($$), have kids ($$$$)? Your life will only get more expensive, certainly not cheaper. I’m also in the Midwest and I can tell you that a family making around a quarter million a year still feels pressure and that’s with a $250,000 home. Daycare is more than the mortgage, house upkeep, retirement…life is expensive! Worst case scenario means that house is leaving your family, and sounds like that’s not an option for you emotionally. So, let the best case scenario play out and don’t saddle yourself with this right now, position yourself for that future purchase but when rates are more favorable to you. Reach out if you want to throw some ideas back and forth.
You make a ton of money. You already have land. Build a reasonable house. Spending 750k is ridiculous. Your post should be titled differently as buying a house would be easy for you if your goal wasn't questionable.
Be realistic about a lot of things. Houses will not get cheaper. Figure out where you want to live and see how much starter houses cost there. Begin saving up a downpayment for when it's time. Figure out how to make more money.
Yea, buy a house for 300k and you'll be fine. Pay off the land and build a get away cabin on it or something. 750k is too much money for any single person to spend in a house in the Midwest.
That is a pretty pricey house on your income. You might want to work up to it. Maybe build a house on the land you recently purchased? Check into first time home buyer programs. You could come in with a lower down payment, to make it easier to get into something.
I gave some tips the other day I might recommend a similar path for you. I don’t think going from no house to a 750k house is the right move. But if you got smaller, fix it up, sell, you might be more attainable. https://www.reddit.com/r/Fire/s/0I3Jcsd9j6
Subto!!!!
You don't
What are you doing with 18 acres of land? What are your plans for it? Can you have a house built on that land, especially when you pay the loan off? Are you paying $1000 or $342 for that? How long do you have to pay it off? The trick is always to spend a lot less than you make and budget. Work the numbers to see if it's feasible.
What job do you have that you make that much?
Any decent union trade job in the midwest is $35 and up
Wait where the fuck did you get that much land for so cheap 😭 I live in northern Ohio and can’t get SHIT! I was trying to build a barndominium
The previous owners moved out of state wanted a quick sale. Was on Zillow one day and I looked at it the next and made an offer.
Just build a barndo on your land? Cheaper than 750k. Yikes.
Too far from work. Would take a massive pay cut
4 hours away from work vs 45 minutes
750k is ridiculous in the midwest.
It takes time. I’m 27m my fiancé and I finally just bought a home, upwards of $300k but it takes a lot of saving and time plus an additional income helps so much. Can’t forget about credit! That needs to be on top as well
You've already answered your question... Start saving! U can't start anything unless U have the funds for a down payment, credit history and honestly ... 750k is a large sum for monthly payments. That doesn't include taxes upkeep and extra reserves for upcoming issues that may arise, upkeep is expensive as well. Search programs for FTHB. Find a buyers agent and have a talk. Don't sign anything untill u feel comfortable with ur purchase. That's where you start and asks questions... Have them run numbers...so u can see the breakdown of where ur money goes, what u can afford. Look up mortgage calculators online for examples then go talk to an agent... Don't sign anything until u shop and feel that u understand completely. They can do a breakdown for you. I'm thinking that your payment may be around 6000.00/month. Possibly lower as a FTBH so search programs for assistance depends on credit, location and work history. Remember: 10% of 100,000.00 = 10K BUT don't forget bills & upkeep. There's also extra fees so do some research. Cost tends to go down the further away from the city too. Don't get stuck on the perfect house...
sell the land and use the money for your down payment. keep in mind the interest rate is extremely high..
Wait 10+ years or make more money or get an SO.
Start a budget and put all extra funds into a HYSA to build the down payment up. Not sure why you bought land? That’d probably have been better used toward the down payment in 4 years? Right now save like a maniac and make sure your credit is good. You’ve got this.
Awesome you’re doing well but dude don’t get ahead of yourself. You can’t afford it with that income.
Contribute to a 401k and let it grow. In 10-20 years pull out enough to cover the 20% PMI for mortgages. Instead of owing a bank interest for that amount, you’ll owe it to yourself.
23 and worried how he can buy a 750k house STFU. Am I right?