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I always felt comfortable with general rule of thumb for buying a home ( approximately 3 times the household income).
My brother lives in a a HCOL area - Bay Area to be specific. Their family has been renting for the last 6 years and saving for down payment on a single family home to accommodate growing family.
The house that they got selected for (apparently there is a lottery system for picking buyers in new communities) costs approximately 4 to 4 and 1/2 times their household income. He is the sole provider for the family and understands the risks associated. He says this is quite normal in the Bay Area.
So, are the borrowing / affordability rules of thumb different for Bay Area? He asks for my advice and I wanted to gather some inputs from this informed group.
Any insights would be helpful.
My brother lives in a a HCOL area - Bay Area to be specific. Their family has been renting for the last 6 years and saving for down payment on a single family home to accommodate growing family.
The house that they got selected for (apparently there is a lottery system for picking buyers in new communities) costs approximately 4 to 4 and 1/2 times their household income. He is the sole provider for the family and understands the risks associated. He says this is quite normal in the Bay Area.
So, are the borrowing / affordability rules of thumb different for Bay Area? He asks for my advice and I wanted to gather some inputs from this informed group.
Any insights would be helpful.