Buying a House on a Nurse's Income: How Do Nurses Afford $450,000+ Houses?

[SilverBells]

One of my goals is to eventually be able to purchase a house.  Many of my nursing colleagues are purchasing homes that are worth $450,000, $500,000 or even more.  Sadly, my budget is about half of that or even less, which means the houses I have to choose from are not appealing.  Most of them are small, old, or both. 

I am just curious how other nurses manage to purchase decent houses? I've been looking through my income, and I just can't find a way to make it possible to incorporate such a house into my budget.  I am salary, so there are no opportunities for overtime.

What are other nurses' experience with buying houses? How did you make it work? Did it require switching jobs? Inquiring minds want to know!

Thanks ? 

[Rose_Queen, BSN, MSN, RN]

I paid $150,000 for my first house. It’s a starter home, not the one I intend to live in forever. It’s a townhome with an HOA (NEVER doing that again!) and was $25,000 under what the bank approved me for. It’s what I could afford as far as mortgage payment at the time without stretching myself too thin. Those buying $450,000 homes? One, they’re likely double income families. Two, never assume you know someone else’s financial situation. There are a LOT of people who live well beyond their means. 

[SilverBells, BSN]

12 hours ago, Been there,done that said:

This is a question for your investment counselor. We are nurses.

 

Valid point.  I just thought I would see if there were any suggestions since I figured if anyone knew how to buy a house with a nurse's income, it would be other nurses.  Plus, it doesn't seem right to reach out to colleagues with nicer homes to see how they are able to afford them.  

[SilverBells, BSN]

11 hours ago, LovingLife123 said:

I think it truly depends on the cost of living in your area.  I bought a house on my own about 10 years ago.  I would suggest speaking to a loan officer.  They can help guide you.

I could not though afford my house and my lifestyle by myself.  If I were on my own, I would have to live extremely frugally to afford my house and all that goes with it.  

The biggest problem in my area (and I am sure it is similar in other areas) is that while the cost of living and cost of housing is rising, employers are not offering increased wages to compensate for this.    Additionally, the majority of the new houses being built are quite large, with many of them nearing $1 million if not even more.  The newer homes that are a bit smaller are still in excess of $400k.  Unfortunately, if  I want nicer living arrangements, I have to settle for an apartment or townhouse.   Otherwise, if I want my own house, the only options are old, small houses built in the 50s-70s.   It's a struggle, because none of these options are ideal.  

8 hours ago, Pepper The Cat said:

Stop spending money on buying Diet Pepsi’s at work.

Budget.

 

Why am I not surprised about this answer? ?

With that said, even if I were to cut back on my Diet Pepsi purchases, I still would not be able to afford the type of house I'd like. 

[Rose_Queen, BSN, MSN, RN]

5 minutes ago, SilverBells said:

I still would not be able to afford the type of house I'd like. 

Then you need to make a plan for how to get there, whether it's starting with one of the old, small houses built in the 50s-70s (and don't knock those- in my area, they are far superior construction compared to the mass production/building of newer homes) to make the investment in equity or whether it's trimming all of your non-essential costs and putting every extra cent into a savings account for a future home or whether it's finding a way to increase income.

[SilverBells, BSN]

7 hours ago, meanmaryjean said:

Having a spouse with a decent income certainly helps.

And don't compare someone else's fifth house (bought with the equity gain from the previous four) and a typical starter house (where you start building that equity).

We gave up even the thought of annual vacations and newer vehicles to be able to afford the home we wanted for our four kids. It was a trade-off we were willing to make. Despite what media would have you believe- you really cannot have it all. 

Envy gets you nowhere except unhappy. Buy what you can reasonably afford. 

A couple of points related to the highlighted: 

1.  It makes sense to not expect that  I would be able to afford the same type of house as someone who has already owned multiple.  However, most of the people that I know of who are buying these expensive homes are purchasing them as their first houses.  They were able to skip past the starter home stage to purchase a more ideal home.   Several of them are a few years younger than myself, so it obviously can be done.  It's just a matter of how.  

2.  I understand that some people have trade-offs, but I am not convinced that it is not possible for some people to have everything that life has to offer as I've observed this among some of my colleagues who appear to have everything.   It's just become apparent that I am likely not one of those people. 

 

[amoLucia]

On 3/6/2021 at 8:28 AM, Pepper The Cat said:

Stop spending money on buying Diet Pepsi’s at work.

Budget.

The way you spend on vending machine diet Pepsi, I figure you'd have an extra $300/month for principal pay't. And then what you pay for the peanut butter cups and Snickers.

[JBMmom, MSN, NP]

13 minutes ago, SilverBells said:

but I am not convinced that it is not possible for some people to have everything that life has to offer as I've observed this among some of my colleagues who appear to have everything.

Unless you are paying or seeing all of their bills, you might be surprised at how far others are getting themselves into a hole just to look like they have "everything they want". I know people that are so far under water they will likely never be out of debt. Mortgage companies, credit card companies, etc. all exist and rely on people that will never live within their means.

I myself have a mortgage on my 60 year old (third) home, I have two cars that are paid off or were bought with cash. I recently did have to finance some home projects, but other than that and my house I am currently without debt. I pay off my credit card at the end of every month and enjoy the cash back rewards I get for free. I paid cash for my most recent schooling (post Master's APRN degree), and I'm about to send my oldest off to college and I think we've saved just about enough to cover his four years without debt (with some help from my parents). All of that was making less than $100k/ year. I'm not perfect, and I could be doing better but right now I'm okay with where we're at. Check out Dave Ramsey for some concrete suggestions on how to get to where you want to be. But you have to be ready to really tighten your belt and your wallet. Good luck.

[dream'n, BSN, RN]

I'm currently buying my first home and I am not young.  Where I am it's a huge seller's market with housing prices rising by the week, but the interest rates are so historically low it makes sense for us to buy now.  I regret not doing this much sooner in my life since I have nothing to show for all those years of rent money flying out the door.  My recommendation is to buy something you can afford (not your dream home, but something with good bones in a growing area) and live there for awhile to build up some equity. Hopefully then you will be able to sell it and purchase a nicer home.  Rinse and repeat as needed.  Don't waste your money renting if you don't have to, get a house where your money will appreciate over time.  Good Luck, the home buying process is not easy and is very stressful.

[LovingLife123]

Have you spoken with a mortgage company about rates, differing loan types, and how much you can afford?

I live in an area where a new housing development is popping up monthly.  I live in what I call a modest home.  It works for me and my family.  I do not want one of those 4-5000 square foot homes.  I don’t want to clean it.  With everyone in this house constantly on the go, I don’t have time.  
 

Don’t compare yourselves to others.  Seriously.  You need to look at more than the home.  My family and I live in a middle of the road home.  We could probably afford much more.  But, we also have newer cars, all boys in sports, we dress nicely, eat out when we want, and take the occasional trip.  We are happy and don’t have debt.  We both save well for retirement as well.  
 

Do what is right for you.  Not trying to keep up with everyone else.

[MunoRN, RN]

The median salary of an RN is a little over $4,000 per month after taxes, the monthly payment for a 30 year mortgage on a $400,000 mortgage is about $1800 per month leaving $2200 per month after the mortgage payment that seems pretty affordable, and that assumes a single income household.

[Rose_Queen, BSN, MSN, RN]

7 minutes ago, MunoRN said:

The median salary of an RN is a little over $4,000 per month after taxes, the monthly payment for a 30 year mortgage on a $400,000 mortgage is about $1800 per month leaving $2200 per month after the mortgage payment that seems pretty affordable, and that assumes a single income household.

My mortgage is more than half of that for a home less than half the value. Don’t forget about property taxes and home insurance that will jack up the monthly payment. And that $4,000 is gonna be before taxes so there goes another big chunk. Student loans? Another big chunk. That $2200 is disappearing quite quickly. 

[MunoRN, RN]

1 minute ago, Rose_Queen said:

My mortgage is more than half of that for a home less than half the value. Don’t forget about property taxes and home insurance that will jack up the monthly payment. And that $4,000 is gonna be before taxes so there goes another big chunk. Student loans? Another big chunk. That $2200 is disappearing quite quickly. 

The $4000 was after taxes, the median RN salary is a little over $6000 per month, but you're correct that there are many other costs of living, although with the mortgage being less than half the (after-tax) monthly income, it doesn't seem impossible.