Purchase Threshold sanity check....
Hey everyone,
Looking for some perspective on what kind of upgrade price would make sense for us right now. My wife and I (35) would like to upgrade for more space. I’d like to sanity check our numbers before purchasing since prices have significantly increased where we are located (HCOL) and we have a kid on the way.
Monthly Income: $16.4k (post taxes and maxing 401ks) ($370k gross and not including ~40k annual bonuses)
Additional Income (side hustles): We both have side hustles that bring in a combined 2-5k a month
Assets: $800k (401ks)
Current Mortgage/Taxes/Insurance: $4.3k
Expenses: $7k/month
Equity: Our current mortgage is $483k and think we can sell our home for ~$950k-$1m leaving us ~487k in equity.
Cash: $260k HYSA
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We are targeting the $1.3-$1.4m range. We are looking to put down $700k as a down payment ($450k in equity +$100k cash +$100k gift). At $1.4m and $700k down our monthly mortgage would be $5.9k.
Is this a reasonable purchase? We don’t plan to move after this and would like to grow into this home. Given the baby is on the way, I’d like to scale back on the side hustles but it may be required to give us more of a savings cushion. I think this is a stretch but at the same time there are very few homes in the area, the school district is fantastic, and our incomes will increase in the future. I’m also trying to balance the potential need for help with the baby at some point which may result in another ~$5k childcare expense.