You mention low interest rates. Be careful there. I believe, as do many Piggs, that buying when prices are low and interest rates high is much better than buying high when rates are low. You will achieve better asset growth buying at a low price, and you will be able to later refinance.
Also whether prices are low or high may depend heavily on the ‘hood where you buy. If I take the $390K price one of the posters mentioned, those neighborhoods may have already been hit pretty hard. Still, economic uncertainty should make you take pause, for sure.
Lastly, you’ll do so much better waiting until you have 20% down. Most importantly, you’ll avoid PMI and can go for a conventional loan. I’m not sure of why, but I know HLS is not fond of FHA loans and that is good enough for me to suspect you may not want one.
My best advice is this. I have given this advice to many both on and off this board:
Take the monthly payment of a house you would buy (include monthly principal, interest, prop tax, insurance, maintenance). Take your current rent amount. Subtract the two. (I’m assuming the payment is higher). Put that much into the bank every month until for at least a year, or until you have a 20% down payment – whichever comes later. When you reach 20%, you will be very close to ready to buy.
An obvious benefit is that you force yourself to save money, build a down payment, and thereby lower your payment when you do by.
A hidden benefit of this plan is that it makes you feel comfortable about making the house payment, because you effectively have been making it for a year. You lived without that extra money so you will be 100% confident that you can manage the payment.
If you find it difficult to put that much money away, you certainly aren’t ready to buy.
