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okcknight t1_iu5m70d wrote

Reply to comment by jennbo in RVA Real Estate AMA - "What The H*ll Is Happening?" Edition by Kindly_Boysenberry_7

If you plan on staying long term, but what you can afford. You may not be able to afford it later.

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Kindly_Boysenberry_7 OP t1_iu5ortj wrote

I 100% agree with the advice buy what you can afford. Do not stretch for a house. Make sure you figure in all the additional costs (utilities, a "slush fund" for unexpected repairs, and then another cushion just to be safe, like for increases in your real estate taxes or homeowners' insurance premium). The general rule of thumb is you should not be spending more than 30% of your gross income on housing. But if you have huge student loans, or major childcare expenses, or love to take expensive vacations 2x a year, you may need to spend less than that 30% rule of thumb. Whatever you do, just make sure you are not going to be house poor. That's how things go off the rails.

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ohihaveasubscription t1_iu632tj wrote

Is it 30% gross, not 30% net?

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Kindly_Boysenberry_7 OP t1_iu66nwp wrote

I thought it was 30% of gross, but certainly 30% of net would be more conservative. It's really only a rule of thumb, so you have a rough way to measure. At the end of the day, what are you comfortable with?

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