patrick.net

My motto was, and I got, I wanted the most house for the least amount of money.

Space, Rooms and Yard. I drive by houses that has nicer curb appeal and nicer lawns throughout, but they look you could open a side window, and your neighbor does the same and they could shake hands, and the back yard ends at the backdoor steps. Those houses aren't for me, at any price.

lol, when graphs/charts/tables/plots are put together by none math/science types, it could not be more transparent, lol ;-)

For the sake of discussion, when I bought in 2007 (30yr fixed at 7%), lenders were willing to lend me as much as would be covered annually by 45% of my gross annual income.

I.e. With a $100,000 salary at 7% interest rate for example, they were willing to lend me enough to translate to ($45,000/12) = $3750/month for 30yrs (principle+interest+HOA+taxes). Back that that would be $580,000...

Today, I don't think they banks are quite as optimistic.

ChrisKolmar says

How Much House Can You Afford

I could afford to pay $50,000 for a beat up old Alpha Romero...
But decided to pay only $680.

Im pretty sure a billionaire could afford to pay $10M for my home ...
But it would be foolish to do so...

What one can afford and price they should pay are too different things,
something of an idea lost during the raging bubble years.

Back in 2005 I was pre approved for 500k. My accountant told me I'd be lucky to afford half that- he told me flat out anything over 200k would be streching.

I still rent.

in year 2001 i got approved up to 400k. bought a home for 300k

in year 2004 i got approved up to 1.5m (my salary was about 5k higher per year!!!!!!!) so I bought one for 825k and flipped it the next year for 1m. zing! (the buyers still live there, i think they got a loan mod/princ reduction... sometimes everybody wins)