younginvestor2013
Recycles dryer sheets
- Joined
- Feb 6, 2013
- Messages
- 226
I am under contract to buy a new condo for about $358k. The new place is a 2 bed 2 bath in Chicago. My current place is a 1 bedroom 1 bath also in Chicago. The new place is desirable because it gives me more room and is more realistic for a long term residence.
I am curious to hear the ER community's thoughts on whether or not this is a frivolous purchase. Obviously, the more frugal, FIRE route would be to stay put in my current place.
STATS:
Age: 29
Taxable investments: $181k
Retirement Accts: $183k
Cash Savings: $88k
Current Home Equity: $60k (this is net of realtor fees, mortgage pay off, closing costs, etc). Note, I only put $40k into my condo when I bought it, so I've gained about $20k from market appreciation.
NET: $512k
I would put 20% down, so the cash to close amount on the new place would come out to about $75k-$80k. This would bring my NW to $432k after it's all said and done.
The new place would cost about $2,400 / month all-in (including PITI, utilities, HOA), and the current place costs about $1,650 / month all-in.
It essentially comes down to me saving less than I am now.
Current income: [2018] $95k with annual savings of about $21k.
Projected: [2018] $95k income with annual savings of about $14k-$15k.
I don't know why but something has me uneasy about the purchase. I don't think it would materially affect things, but essentially I am taking on an extra $105k in debt when it's all said and done. But this is my dream place, mortgage rates are still low, and the market is at an all time high, so that is what makes me wanting to pull the trigger. At the same time, it's all stressing me out....
Thoughts? Advice? Input?
Thanks in advance!
I am curious to hear the ER community's thoughts on whether or not this is a frivolous purchase. Obviously, the more frugal, FIRE route would be to stay put in my current place.
STATS:
Age: 29
Taxable investments: $181k
Retirement Accts: $183k
Cash Savings: $88k
Current Home Equity: $60k (this is net of realtor fees, mortgage pay off, closing costs, etc). Note, I only put $40k into my condo when I bought it, so I've gained about $20k from market appreciation.
NET: $512k
I would put 20% down, so the cash to close amount on the new place would come out to about $75k-$80k. This would bring my NW to $432k after it's all said and done.
The new place would cost about $2,400 / month all-in (including PITI, utilities, HOA), and the current place costs about $1,650 / month all-in.
It essentially comes down to me saving less than I am now.
Current income: [2018] $95k with annual savings of about $21k.
Projected: [2018] $95k income with annual savings of about $14k-$15k.
I don't know why but something has me uneasy about the purchase. I don't think it would materially affect things, but essentially I am taking on an extra $105k in debt when it's all said and done. But this is my dream place, mortgage rates are still low, and the market is at an all time high, so that is what makes me wanting to pull the trigger. At the same time, it's all stressing me out....
Thoughts? Advice? Input?
Thanks in advance!