Apartment / House Purchase Price
For those who have bought an apartment or a house, how did you assess the purchase price relative to your net worth and income? What is a good rule of thumb to figure out a reasonable / affordable price range?
ran a calculation on the implied forward rate and refi'ing in the next couple years what my monthly take home is, and then not only looked at that but maintenance cost, taxes going up, insurance increasing. Then, I looked at it without my bonus or carry. Looked at comparables to see if the value was inflated. And looked at something reasonable that was 25-32% of take-home. I realized I could save money renting and being closer to the office and investing the leftover. Don't let the realtor say oh your approved for this lets look at this. Nope I stayed 20-35% below my approval knowing about hidden sunken costs. Just not worth it when I saw once place that needed a new HVAC and we were negotiating escrow for the new system. Was able to walk away.
This is a very good framework to work within.
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