The first question I have is, did you read the primer articles from Rich and the many threads we have so far about how the market is declining? If yes and you still want to buy, even with the possibility of going negative then lets talk about the actual numbers.

A townhouse usually have HOA. did you calculate that into your monthly payment? Buying a house for $500-520k would yield between 2700-2850/month with 70k down. Also, since that’s not 20% down, it’s definitely harder to get a loan. I know both E-Loan and E-trade don’t have jumbo loans w/ less than 20% down anymore. If you do find a jumbo loan w/ less than 20% down, you probably will be paying at least 6.5% if your credit is perfect.

We haven’t even count in taxes yet. Which should be around $400/month. If $2600/month will yield you $0 in savings, then you can’t really afford a $500k house. We also haven’t talk about maintenance and emergency fund either. What if your car break down and needs repair. If I were you, I’d rent.