How did u come up with the money for your house down payent?

Blessing1

Sun, Dec 27 2015, 1:31 pm

And what so wrong with renting for a while? U don't must buy a house as a young couple.
We're saving for years but things keep on coming up & prices keep on rising, so it doesnt look like we'll be able to buy in the near future. I'm perfectly happy renting.

Maya

Sun, Dec 27 2015, 1:42 pm

We're renting for eleven years, and will be buying something now after saving up money for a down payment.
I don't either understand why newlyweds think they must own a home soon after getting married, especially if they're still in their 20s.

amother

Seagreen

Sun, Dec 27 2015, 1:56 pm

Maya wrote:

Because rent is viewed as wasted money. It doesn't go anywhere. Yes, you have a roof over your head for now but you don't own it and can't sell it later. The money goes nowhere.

amother

Hotpink

Sun, Dec 27 2015, 1:59 pm

At a certain point the rent u pay will be more than a mortgage. I rented an apt for 2 years. It was a 1 bedroom 1k a monthih. I bought a house. Rented the basement out for 1k. I only paid 1200 out if pocket. Was a 3 bedroom. If I rented that easily 2k
Next house. Rented basement...pay around 1500 out of pocket. The space I have would be 3.5k to rent easily. 6 bedrooms.

Blessing1

Sun, Dec 27 2015, 2:43 pm

I don't view the rent Money as waste. I have a roof on my head & in my area it's way cheaper then a mortgage. & the taxes here are very high so the mortgage plus taxes will come out to 3 times as much rent as I'm paying now for my decent 3 bedroom home.

mha3484

Sun, Dec 27 2015, 3:29 pm

DH had a lot of success with the stock market when he was single. A lot of it was lost in the market crash but there is enough for something small. Only issue is to upgrade from our 2br apt to either a condo that has an assessment or a house would be a bigger monthly payment and with tuition it's not practical for us now.

Maya

Sun, Dec 27 2015, 3:58 pm

Blessing1 wrote:

Agree. Even in areas where rent and mortgage are similar, it's not a waste of money if you have use out of it.

tigerwife

Sun, Dec 27 2015, 4:04 pm

amother wrote:

Because rent is viewed as wasted money. It doesn't go anywhere. Yes, you have a roof over your head for now but you don't own it and can't sell it later. The money goes nowhere.

We thought so too, and we're looking to buy a house in the area we wanted to live in for this reason- rent would be more than a mortgage. However, there are so many other costs involved, like closing, interest and taxes that we realized it would cost the same to buy and to rent for a five year period.

amother

Khaki

Sun, Dec 27 2015, 4:26 pm

Building equity is a reason to buy a house.
I see it as a place to borrow money when I make Chassunahs.

I know many people who only manage as they have a house to borrow from and since for the vast majority saving for retirement is difficult, owning a house is a nest egg.

mille

Sun, Dec 27 2015, 5:22 pm

We don't have the house yet, and that's perfectly ok. We have a plan - we are both employed, and we worked on making sure we have a 6 month emergency fund first, then we budget each month towards a down payment. We also both pay into 401ks. We have no debt like credit card debt or whatever, so we just budget with what we earn. Maybe it's cultural, but the majority of my friends bought houses without any help from family at all. I know very few couples where only one works (and if that's the case, there's usually a temporary reason - like a recent layoff with no new job, or one partner is in an intense school program and it's temporary), and it's a lot easier to save when you have two incomes rather than one. Most people in my community also wait to have children at least 2 years if not more (which means you save more in the beginning), space their kids further, and have less kids overall compared to other communities. I only bring up this last point because people above are mentioning Brooklyn. I imagine it's a different story here when couples marry after college, both with full time jobs, wait 3 years to have kid #1, then they buy a house when pregnant with kid #2, 2 years later - so 5 years after marriage and probably around age 30-32ish.

MagentaYenta

Sun, Dec 27 2015, 5:32 pm

I bought my own house at the age of 21 with savings. In my family and community at the time it was pretty normal to buy a small condo or home as soon as possible, even if you became a homeowner prior to marriage.

amother

Tangerine

Sun, Dec 27 2015, 5:49 pm

We bought a 2 bedoom condo in Brooklyn when we were married for 2 1/2 years. I had been working for 3 years and my husband had been working for 2. We didn't spend money on ANY extras. Our down payment was $40,000 and we did the minimum renovations for $10,000.
It was amazing that we bought because to rent would cost us a couple of $100 more then what we pay our mortgage every month.

justforfun87

Sun, Dec 27 2015, 7:41 pm

Like most people said they are lent the money by family or paying mortgage insurance. For me personally my father passed away and I used the money from his insurance policy to put down 20% plus a bit came out of stocks I had in my name from childhood. I truly believe we would rent forever if my circumstances were different. We have way too many loans to pay off for school I have one friend that owns and was former military so they do not even need a down payment.

amother

Lavender

Sun, Dec 27 2015, 8:01 pm

Blessing1 wrote:

I'm the amother who lived in a studio apartment for a few years.

I think that if they can swing it financially, it makes a lot of sense for a young couple to buy a house. It's so much easier for people to save up for a down payment when they have minimal expenses. Without children and tuitions and looming bills for simchas, as long as a young couple is making a decent living and not spending much on frivolities, then it's much easier to save up enough money in a shorter amount of time.

Even if they can only afford a "starter home," then at least they build up equity to afford a larger home when they need it. As you say, prices are only rising. So it just gets harder and harder to save that down payment.

That said, I think it's extremely entitled to expect parents to buy a house or even contribute significantly to the down payment.

amother

Mistyrose

Sun, Dec 27 2015, 8:10 pm

I got married when I was 23, I lived at home until then, so I had saved most of my earnings. We bought a cheap condo on a newly frum block about a year after we got married. We used the money I had saved, plus our chasunah money. We also borrowed about $15,000 with a plan to pay it back over 5 years. We were able to pay for the condo in full.

By the time we were ready to buy a larger house, the block was almost fully frum, the condo had gone up in value by a lot, and it was fully paid off. We were able to put about half down on our new house, b"h. The only problem is that our bigger house is no longer big enough, and everything in town went up so much, that in order to buy a bigger house we will have to move out of the frum area. We don't want to do that with bigger kids.

HonesttoGod

Mon, Dec 28 2015, 2:02 pm

I don't even know what $K look like.
We save and save and save, we always save, but something always comes up and we never have more than $5k. I can't see myself buying a house in the near future and I don't think rent is a waste of money. It IS going somewhere - to a roof over my head, to a place for my kids to live and eat and be happy. Waste is garbage, my rent isn't garbage.

I also believe that the young couples buying houses in Brooklyn are doing so with assistance from parents or grandparents. Or a really high mortgage. It is practically impossible to get a house otherwise (even for some older couples, its hard to get a down payment on a $1.5 million house).
Unless they are buying a $700k condo.

Chayalle

Mon, Dec 28 2015, 2:19 pm

My grandparents started a mutual fund for me with 5K when I was born. As a teen I added to this with summer jobs, and when I was single I put as much of my salary as I could into it. By the time I got married I had enough for a downpayment, and left some for savings.

LiLIsraeli

Mon, Dec 28 2015, 4:23 pm

Ruchel wrote:

Many people can't, so they buy without. It makes for a longer bank payment, and/or more money every month and higher rate of interests.

There are very few options for buying without a down payment. In most cases if you don't put down 20% of the cost of the house, there will be no house.

There are certain programs for first-time homebuyers or lower-income people but in most cases, you need the down payment.