How to know if we can actually afford a house
Evaluating whether a home purchase is financially safe requires balancing the down payment, remaining emergency savings, and existing debt against future income shocks like job loss. Without a clear way to weigh these risks, buyers are left questioning whether a large purchase leaves them in over their heads or taking on too much.
What people tried
Every workaround mentioned in the threads below. We haven’t tested any of them — and nobody here is claiming they worked.
- 1Calculating debt-to-income ratios and housing rule-of-thumb percentages
- 2Running scenarios on job loss and single-income feasibility
- 3Accelerating car loan payments to free up monthly cash flow
- 4Compiling detailed income and expense breakdowns for public peer review
- 5Isolating baseline earnings while excluding variable overtime and side work
- 6Budgeting aggressive monthly principal paydowns for bridge financing
- 7waiting a couple more years to save a larger down payment
- 8living as frugally as possible for a few months to test financial discipline
- 9dialing down discretionary spending significantly
- 10Renting instead of buying
- 11Waiting to marry someone wealthy or hoping to win the lottery
- 12Staying put in rentals
- 13Consulting the personal finance subreddit wiki flow chart
- 14Buying a house on a 15-year loan, fixing it up, selling it, and repeating
- 15Renting an apartment and investing the money instead
- 16Defining the threshold for comfortable with written numerical expenses to complete the remainder of the budget.
- 17saving aggressively in a low-interest savings account
- 18maximizing 401k contributions
- 19keeping rent low
- 20Keeping mandatory expenses very low to allow for career freedom
- 21Considering income stability, other debts, savings, and down payment amounts
- 22Saving between £1500-£2000 a month to prepare for the jump in outgoings
- 23Analyzing take-home pay versus monthly bills and future rate adjustments
In their words
Unedited, most upvoted first, each linked to the thread it came from.
“i make 30k a year, and i am looking at a 60k house. Would that be feasible?”source ↗
“Afraid of being house poor; what do you think about viability of purchasing a home?”source ↗
“I'm quite insecure about the fact that I am not able to get a 20% downpayment, much less even 10%.”source ↗
“Im really trying to figure out as a single male if this is a realistic goal and if it would ever be possible for me to try an own a home in my current situation.”source ↗
“Aside from a 6-12 month emergency fund and a car sinking fund, what other financial milestones should we aim to achieve before we’ll be “ready” to buy a house?”source ↗
“So my Take home pay after taxes and insurance is 3200 and I’m not in major debt and I own my own car. So I’m looking at an Apartment that’s 1250 a month and 162 with utilities including internet.”source ↗
“Curious how to even save up for a 20% down to avoid mortgage insurance.”source ↗
“I don’t even have a kid and I can’t afford to buy.”source ↗
“I bought a house and it’s kind of a scam between the mortgage, hoa and fixing broken stuff I’m pretty much paying rent every month”source ↗
“I live in Southern California and make about the same amount and I don’t expect to ever buy a house unless I marry someone wealthy or win the lottery.”source ↗
“We will have about 20k emergency fund after the downpayment. We could afford it but it would be hard if one of us was fired.”source ↗
“My wife and I are planning to build a new house while keeping our current two-family as a rental. I’m looking for outside opinions on whether we’re financially in a good position to do this or if we’re taking on too much.”source ↗
“I'm still going over budget some months. I'm not in debt (aside from the mortgage, of course), but i only have like 300 bucks after my *disappears from my paycheck before I ever touch it* savings.”source ↗
“Want advice on what do to with my money”source ↗
“I saved up the money anticipating I would use it to buy a house but now I am having second thoughts, I realize now it would have been better to invest that over time but it is what it is. What would you do in this situation? Go for a house or get into an apartment and invest the money until I could buy a house in cash or something else?”source ↗
“Looking to close on a home, wanting some insight on if we are in over our heads.”source ↗
“It’s a big purchase and a lot of numbers to think about.”source ↗
“I'm trying to decide if it will be a big mistake to take on this mortgage. If my income falls to the level of previous years, the home would cost 50% of my income.”source ↗
“Me and my partner are going to buy a house together, I earn around £62,000 between 2 jobs including a shift allowance and she earns £47,000. We are buying a house worth £500,000 with a 30 year mortgage at the amount of £358,000 at 4.99% fixed for 2 years.”source ↗
“I am excited to be making this move together but I can't help but feel intimidated by the monthly payments. Currently we save between £1500-£2000 a month to prepare ourselves for the jump in outgoings but doing that stretches us to our limit.”source ↗
“I'm worried that without the extra money our savings will dwindle and we'll have to sacrifice possibly more than we realise.”source ↗
Where this came up
People with this problem also raised
- 5Can I afford to move out on my own?
- 5Why are even old used cars so expensive now?
- 2How to estimate home repair costs before buying
- 2How to pay a mortgage after a sudden drop in income
- 5Should we renovate our aging home or buy a new construction house?
- 5Should I buy a house with conflicting roof damage reports?