Should I buy a house here in San Francisco?
invite response
2014 Apr 22, 8:04am 14,177 views 48 comments
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SFace
2014 Apr 25, 12:47pm
You mean the ghetto calculator. The higher the %, the more ghetto and more ok?
BayArea
2014 Apr 25, 2:33pm
You mean the ghetto calculator. The higher the %, the more ghetto and more ok?
While it's true that there is a correlation between rent:buy ratios and how ghetto a city/zip code/neighborhood is, it still has to make sense on some level to buy vs rent.
The original question is should the thread starter buy in SF. I'm not saying he should look for rent:buy ratios that match East Oakland or Vallejo (>10%), but you never know what the future holds in terms of job loss or financial distress. If I can't at least break even on my mortgage with rent on any given property, I really have to think twice if it is a move I want to make.
If you can't make money renting, then you are banking on the value of the house rising. With this latest bubble, I'm not sure that's a bet I'd want to make, at least for the not too distant future.
Of course there is the counter argument that if you are ready to buy, and you can afford it, and you have/want to start a family, and there's value for you in being in SF, then by all means...
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Longtime SF renter here, tried to buy a couple of years ago (missed the "bottom" but to be fair, there wasn't much inventory) and thinking about it again this year
Status: Married with no kids and pretty steady job
Here are the numbers:
Current rent: $4,500 for a pretty nice large 2BR in Marina. Rent controlled, just moved in this year.
Yearly Income: $250K combined. Save about $50K/year now into 401K and brokerage account.
Combined savings: $1.3M, $620K in brokerage, rest in retirement accounts
Live and work in the city, comparable places to my rental go for about $1.2 to $1.6M. Would like to put about $300K down. Leaves us with a very large mortgage however.
Can someone run all of the numbers and figure out whether this makes sense? Or am I better off staying where I am?
#housing