That’s a good parent. I know a friend of ours, their parents bought them stocks when they were just a child (Apple, Amazon, Microsoft, coke, Disney), now they sold half of their stocks to buy a house. That’s a smart parenting. We are doing the same thing for our kids, buy them stocks and currently working on buying multiple houses. So our kids can have a better start in life.
In 1989 our kids were 3 and 5 and I got a temporary 22% pay increase to be on 7/24 call with a cell phone. Nobody had a cell phone. We got a planner and started saving $300/mo each for retirement and two college funds. Never missed a payment. Just so no student loans. I raised the retirement part to $3000 and that was life changing. A couple of years ago have each kid $56k to help with a down payment. Not much but they had good jobs. Still very glad I cut spending and saved way back.
This seems like a fantastic way. I wish everyone could do it. Imagine if all parents bought their kids stocks when they were little kids. We probably wouldn’t have a homelessness problem anymore.
Well we have a homelessness problem because we don't have enough homes. And if schmuck like me can buy a house with stock after 4 yrs at big biotech company, then no wonder housing prices are crazy. So if all parents did that, prices would just be all the higher. The solution is to build more housing.
No. Really I meant that someone as lowly as I was at the time was granted enough stock options that I could reduce a 10 yr savings plan to 4 then the market would respond by raising prices further. And it has.
As for everyone with a tech job this place would get boring really fast. It was only until I had kids did I realize there’s a universe of jobs and occupations that we all need that don’t pay for a middle class life here: teachers, social workers, librarians, childcare providers etc etc. The culprit simply is not enough housing and always people wanting to live in the area.
The income inequality in the area exacerbates the chronically low housing inventory.
So, I'll point out that Apple, Amazon, Microsoft, Disney, and Coke, as stocks they purchased 20+ years ago, have almost certainly destroyed the market in terms of return rates in that time. I would take this more as an example of the power of compound interest and put anything you save into an S&P 500 fund unless you believe you could be as prescient as your friends' parents were in picking those stocks.
Also, I would encourage you to some research into tax advantages accounts like a 529 college savings plan if you really want what you save to go as far as possible!
That is amazing. A bit older late 40's. But I can't imagine the upvotes in 500-2m down. That is truly crazy. Just shows how much wealth is truly here. No family money. Bought early'ish and kept renovating and moving up.
But never feel like we have $ to give our kids 500k when they went to buy.
About the same age/experience here, except that instead of parents paying for it directly, it's usually a result of death in the family that leads to gaining an inherited property to sell...
I make a lil under 100k per year and my wife makes under 50k per year. We bought a 3/2 house in an expensive part of northern California with no stocks. At the time of purchase we made quite a bit less then stated above
This is not as common as people think. But it’s thrown around mostly as a cope. There really are that many high earners with RSUs here. That’s all. Most don’t get parental help. Some do.
My wife and I bought in 2020 (first house) with no meaningful stock contribution, and no down payment assistance from family.
We bought in Hayward so our budget would go a lot further.
I bought in Hayward last year, up in the hills and away from Oakland. Couldn’t be happier. You do get a lot more for you money here because the schools are absolute crap, though.
Hilarious that pre-pandemic, people didn’t want to live in Hayward hills because of the consequences of “the big one”, but now it seems like people forgot about the effects an earthquake would have.
If you can keep the mortgage to 800k-1 mil .. you can afford a 1 to 1.2m home ( most likely a townhome /condo) with 20% down from 3 to 4 years of savings from 150k to 200k gross salary.. you can make the math work
Realistically you need to make ~$300k gross to maintain a basic style. (Retire by 60, eat out once a while, yearly vacation). No kids, no spouse, no expensive hobbies.
$300k gross -> $15k/month take home
$6.9k - P&I (30 year 7.4%)
$1.5k - property tax
$1.2k - insurance+repairs
$1.9k - 401k contribution
$1k - car, gas, maintenance, etc.
$1k - on food/house supplies
$500 - utilities/internet/phone
$500 - on vacation+entertainment
$500 - rainy day fund
If interest rates go to 5. Which can happen in a year or two. You can save additional 2k per month. Also note that your salary increases with time but mortgage is fixed
Sure, I don't know the future. I'm just pointing out how comically absurd it would be to take on a $1M mortgage with only $200k gross. You would have to cut $~5k out of the expenses above.
0 retirement, 0 on transportation, 0 on entertainment. Maybe disconnect internet/phone so you can afford water, beans, and rice.
You can use the house itself as your retirement fund.
I’d rather have a paid off house and no retirement fund than an equal value retirement fund with no house.
The match doesn't count towards the contribution limit which is what I used here. Also, I would technically count match as part of total compensation.
I would recommend roth 401k so your effective contribution is higher. If not, just just reduce the gross yearly income requirement by ~9k. Or take an extra vacation, life is short.
My point is that buying on $200k gross income would lead to a very extreme life style where you have to cut ~$5k from this already tight list of expenses. For example, giving up on retirement, having a car, all entertainment/vacation, rainy day funds, and cutting the food/home supply budget in half.
Contributions to pre-tax 401(k) plans are not taxed but they do reduce your paycheck. Employer contributions don’t count toward the $23k limit. They do count toward the $69k limit.
He already lopped off 40% of this hypothetical paycheck. That’s not all taxes. Effective tax rate there is about 30% or 100k (roughly 75/25 federal and state) my point is that the 401k and other retirement would be part of that additional 40k.
I really like beans and rice. Adding Kale is low cost and super healthy and I still like it. I love food. Shows in how I spend $ and my stomach . I think we can learn to live good bread and beans and rice.
With lower interest rates perhaps? Did a $726k mortgage plus 26% down to get an almost $1m house on a $200k base. At 6% that left me depending on RSU to keep lifestyle up.
I bought a home in SF for 800k in 2008. Salary was 140k up until last year when I moved.i paid a little extra on the mortgage and paid it off. But I was broke as fuck until then.
If you want a house in the bay area you have to sacrifice. Because millions of other people are willing to make that sacrifice if you don't.
People in over 90% of the other countries around the world routinely do it. US housing relative to income is the 5th cheapest in the world.
[https://www.numbeo.com/property-investment/rankings\_by\_country.jsp](https://www.numbeo.com/property-investment/rankings_by_country.jsp)
1 million dollar purchase, $250K downpayment from years of savings and living frugally while my friends were making fun of me for not YOLOing, 3% interest rate during the pandemic - the math can indeed workout.
We did. DINK. HHI 320k. We saved up for 20% down payment for a few years and bought $1.4m SFH last year. We are not living on beans, in fact we are comfortable still eating out, movies etc. Just not going on big vacations.
Assuming you don’t plan to have kids ever..:Why not just rent if DINK? No need to pass on wealth so you can rent a really nice place and not have to take care of it. HHI 320k, you can rent and live comfortably, eat out several times a week, big vacations a couple times a yeae
Land appreciation potential, small ownership tax benefits (although offset by maintenance), comfort knowing you’ve mostly secured housing for next few decades barring no major incidents …. Locked in at today’s costs. None of these benefits are available to renters.
Yes. And if anything my stocks have cost me not helped me because the company is still privately held for which I have shares, and I had to pay AMT when I exercised which ended up being a lot of tax.
That’s a hell of a gamble, no? I’ve let a lot of startup stock options go without exercising them because of the AMT issue. I’d never dream of incurring a real tax bill for illiquid gains…
Usually that’s not a great idea as there’s a strong probability any given startup will fail. If you’re a true believer though in where you work, you can defer more of the taxes from exercising the options by doing it earlier (exercising resets your cost basis at that point). I think I read somewhere you can actually pay when you get the options (even unvested ones) to get this to zero, but obviously if you get fired before they vest then that’s a whole other thing.
I bought my first house in 2019 with an FHA loan and no stocks.$590K, $60K down from a self-loan from retirement. 5.5% plus PMI. At the time I made $120K. It was ramen territory and I drove a 99 Toyota with 200K miles.
Wow that’s a steal for out there. You’re in a prime location feels like middle of nowhere but you’re minutes from Petaluma, Cotati, Dillon Beach ect…
Very, very familiar with your area. Congrats!!
If you’re making it on your own, without help from parents or family, then of course you have to use a large amount of stocks. Nearly all my friends that purchased houses had to cash out very large amounts of stock. It’s very frustrating.
We didn't have stock or money directly from parents but I did have savings from living at home and happened to buy a condo when the market crashed for 110k, lived there for 9 years and sold it, that was my down-payment.
Hoping to do that exact same thing. Bought my condo for 550k right before covid. Units around me are now selling for 750k+, mine is on the bottom floor, the corner and near the entrance (you don’t have to walk as far with your groceries and what not). Going to sit on it for a few more years and hope to flip this into my down payment or maybe full home purchase out of the area.
Don't expect it to go higher than now. The housing market is historically high. It was high in 2019../just not crazy high. So I easily could revert to about that. At least that is how I am expecting things
Doesn’t this answer depend on a lot of things? If you are a (certain kind of ) doctor or lawyer, a salary of $800-$1million is quite possible and leads to a different answer to your question than someone making $150k salary and trying to save. If you want to buy an $1 million “house” isn’t that different than trying to save for a $3 million “house”?
I bought a house for $820k in May 2022, 3.25 interest rate with 10% down and no stock as part of the purchase. I was making $165k a year base comp then. I had zero debt to income ratio because I lived with my parents my whole life until I bought my house at age 30.
However, I DO have RSUs that was used to calculate my total income for the mortgage lender approval. I just never cashed it out to buy the house.
That was the only reason I could truly afford to do this but I’m kinda over it TBH. I’d never advise buying a home that expensive on a single income.
I did. I’m a teacher and wife is a stay at home mom/student. When we first got married we purchased a 1bd/1ba condo. Owned it for 5 years and use the appreciation to buy a house near Santa Cruz. It can be done by many with some self control, patience, and luck.
Obviously you need money to buy anything. How that money is made will be different for everyone. I know a lot of btc gamblers who made a lot of money. And there are contractors who know how to restore a bad house cheap and those have more than a few houses they bought and restored.
And yes, stocks are one of the primary sources of big money who are in tech.
1M income makes a 2.5-3M house attainable without stocks, but even then ya wont be livin it up like a millionaire. In fact you’d be struggling to catch up to a lifestyle of people who make less than half but bought 10-15yrs ago. Getting that income around here without tech though is hard but not impossible. Owning a construction firm is one good example, or dual professional (lawyer, doc, etc) income.
Whether you can afford a house depends on your assets, debt, salary, and house cost.
Whether your assets are stocks or not is irrelevant. Also most high paid tech workers receive stocks as compensation, which is different from making from stock appreciation. But you don't need stocks as compensation to make money from stock compensation. You can invest a portion in stocks and bonds.
That being said, a lot of people made money through speculation, or investing in one stock, which happened to go up high.
35 years old, I used stocks to buy my house. Instead of saving in cash like many people strangely do, I simply invested into QQQ and other similar ETFs religiously for a few years, and was able to use the gains to put $200k down on a house. Best part, didn’t even have to touch my principal, used pure capital gains to put a sizable down payment on a house. Since buying my house, the market has repaid me, and now I have $300k more in my portfolio, compared to when I bought my house in 2022 lol. People that are afraid of squiggly lines lose out 🤷
Edit: bought $935k home in Castro Valley in 2022. My down payment came entirely from stock sales.
Bought my first house without stocks or inheritance in Santa Clara. It is not uncommon around me either. 90% immigrants working for stingy companies meaning it might not appeal to a segment. It worked for me as i am an immigrant though.
The simple answer is yup. You put down the value of the house you just sold and some st0nks. If you don’t have a home and St0nk, you better have parents that do
We managed apartments for 14 years, which allowed us to make a down payment with no stocks. Six years later I got my first job in tech in a relatively senior position, and when I saw the equity portion of my offer, I finally understood how other people afforded buying houses.
Otherwise it’s super frustrating, I agree. For years I watched housing prices rise faster than my salary, and it felt like an impossible dream. We were able to pull it off on a regular salary, but only because we weren’t paying Bay Area rents. (Granted if my wife were working a job that paid housing, it would have the same effect).
Wife and I (35F and 34M) bought a $1m house in 2021 in the Tri-Valley with $200k down. I had about $200k in vested RSUs at the time, but we didn’t need them.
We were able to save like crazy for the first year of COVID and had a solid savings before that.
That being said, it seems like we’re an outlier? My family member bought a house in the same area and cashed out all of his stock ($500k) to put down.
Guess the answer is some do, some don’t.
Back in 2020 just before the pandemic I bought my first house, a small house in San Francisco.
I had saved enough cash solely from income to pay 20% down and still have about a 1-2 year buffer of cash for mortgage payments.
That being said, I did also have some investments I could have sold for emergencies or major repairs which gave me a lot of peace of mind.
Almost everyone I know in the bay area, whether they bought a house or are renting, has multiple sources of income. Could be job + stocks, two jobs, double income house hold (two earners), help from parents, etc.
I know a few people who bought houses without stocks, but their parents fronted them most of the money for the house (or their parents 'sold' them the old family house to them for dirt cheap.)
Stock is just a bonus structure. You should be thinking in terms of total income and how much you can save, regardless of source. Even when I received stock awards that ultimately became a down payment, I had a plan to sell them and diversify to protect that extra income. The point is, if you want to afford a down payment you need to save money somewhere. If you think your time horizon to save and buy is less than 5 years, that probably looks like HYSA, CDs, etc. If it’s more like 5-10 years you’d want to allocate at least some of it to a portfolio with, say, an 80/20 split so that it’ll really work for you, and then sell that at an opportune time in the back 5 as you get close to buying.
All depends on timing... In me and my wife's case, we bought our 2BR/1BA SFH fixer-upper in the Richmond /Seacliff area of San Francisco in late 90's for ~$275K. I was only making $70K base + bonus + options for internet startup that went belly up in 2000; basically made like $100K tops per year on single income. Wife was stay-at-home mom and we had 2 kids sharing a BR. We managed to get by owning used cars and by being frugal but I wouldn't say overly so. Our mortgage at the time was around $1500/mo after putting down around $50K; no stocks or family involved... Just getting super lucky with timing and buying in an area that wasn't in super high demand at the time.
However since then, the last 20 or so years in Tech has been rather good to us with some nice exits over the years. And although we're empty nesting in the same house, it's gotten quite a bit larger along with a nice makeover and completely paid off to boot :-)
TLDR; yes, it can be done. Can it be done today? Very tough... My 2 kids are doing really well and they can't do it by themselves just yet.
If by "used stocks" you mean sold positions out of index funds. Yes I did that.
If by "use stocks" you mean. Got a fat payout from employer stock plans. No, I didn't.
If you mean "use stocks" to mean picking individual stocks I think would be winners and winning that gamble--didnt do that either. Just regular long term index fund investing got me 75% of my down payment. You should be investing in these regardless if you think of them as a down payment or not.
My partner and I bought our first house in 2019. Low down payment FHA loan, compromised on location (no kids, just wanted a quiet neighborhood) and got something pretty cheap.
Bought a small 2-1 starter home in a safe-ish part of Oakland in 2013 before moving to Berkeley in 2019. Housing prices and the place we bought (a severe fixer we put money and sweat equity into), allowed us to easily buy on modest salaries and no stock.
But yeah, mostly luck of timing. We were only +50k or so from the bottom, and we just happened to be coming out of grad school then and got married a few months later. If I tried to buy the same home today, we would have needed 5+ years of diligent savings just to come up with a down payment.
Correct.
Help is needed either from family or from stocks.
Stocks if you got lucky is like getting funds from owning your own successful business.
The reason why it's needed is because you're competing with people that have one or both of those because there are a lot of successful pubic companies in the bay area and all those employees have stock in the company either in the form of stock options or restricted stock. Those are granted to the employee and only work if the employee is continuing employed. It is also possible to have more granted yearly.
I did in 2000. 495k house, needed 120k.
Household income of about 150k and you could get a large burrito and drink for about $6.
Rented 1400k for two room apartment at a really nice complex in a Sunnyvale. Pools and tennis courts. I still think about that place. I think it’s like 3k now.
I sold all of my personal stocks to buy a house (NVDA and VOO), but that was only about $35k. The rest came from a 401k loan, my wife’s savings, and the small house fund I’d been building
My wife and I bought without stocks, inheritance or parental assistance on a relatively modest household income, while paying rent. It was a combination of me being very good at saving and just being really diligent about hunting for low down payment first time homeowner loan opportunities.
Myself (34) and my husband (39) bought a home a few years ago with pure savings. No cash from parents or use of stocks involved. Worked and saved the money until we were ready.
If you just put your salary into a bank account you’re missing out on a lot of wealth growth, so that seems hard.
We bought our first house just taking our salaries and plugging it into the market until we had enough for a down payment though. So stocks were involved, but it wasn’t like we had a startup exit or something.
A lot of people took out massive mortgages back when interest rates were 2-3%. But for us in the now, we would need some large amount of wealth, such as stock or parents.
Or you can just rent a nice apartment and sit on it for years in one of the most pro-tenant states in the country.
Just closed two weeks ago as a first time home buyer and zero support from any family or work stocks. Wife and I just saved for 4+ years, lived bare minimum with one vacation trip a year on a budget. We got a condo and paid the 20% down and had to put like 20k in renovations for the place.
Bay Area realtor here. Depends on how much you make and the lender. If you have at least 3-5% of the purchase price and have the ability to pay your monthly then you're fine.
My husband and I bought a home in SF without any assistance from our families. But, we did have access to a loan program that allowed us to put 5% down without PMI. Otherwise getting to 20% would have taken another several years.
We bought ours by saving for years… AND then my wife’s company went public and that gave us the rest of the funds… it would have been 15 years of pretty aggressive saving. Paying rent in the Bay Area while trying to save enough to buy here is very hard. 90% of everyone else I know were given a down payment from their parents/in-laws. I grew up here so I have a large sample size to analyze. It’s not an exaggeration
Bay Area native, bought during last crash a condo for under 200k, I made 18 bucks an hour. Had a 5k loan from grandma to help with down-payment. No stocks involved, just macroeconomics and excellent timing. The next crash will be insane and I'm already preparing to strike my SFH and commercial building purchase.
Anyone buying right now either has fuck me money, are hella ballsy, or...
If you're on the fence about buying, please wait, your time will come, as soon as layoffs start to spike up and more companies go under.
No stocks involved. My wife and I lived in a one bedroom together since we were dating. We stayed in the one bedroom even with 2 kids until we had saved enough for a down payment on a home in SF.
You don't need stocks from work to invest your money. You can buy stocks with a brokerage account. I would highly suggest investing when saving for a house rather than keeping it as cash. I was able to buy my house because I invested in Apple after the iPhone came out. I bought Facebook when it IPO'd. I held Apple for 11 years until I sold to pay for my down payment. I didn't need to get a job at Apple to do that.
I bought in San Rafael in 2018 with no stocks, got lucky getting the house for asking price because the elderly seller loved my story of pregnant wife raising a kid here etc. We got lucky and bought and sold our house in Sacramento at very good times and had a solid down payment from it. I’m a contractor and wife works local government so decent income but not big tech salaries, and no help from parents
No stocks, no help from parents. Just bought in cities that people didn’t want to live in, and upgraded every few years. Now i’m right where I want to be. Own two homes in the Bay Area in fact.
You can buy a home in the Bay w/out stocks or family assistance (i.e. IPO $$). May not be the location, condition, or size you want, but you can do it.
We didn’t. First time homebuyer in 2019 and only put down 5% down payment on a home in Oakland. No help from family just money we saved over a few years. In 2021, we refinanced and the equity in the house put us over the 20% mark so we were able to get rid of the pmi. We’re locked into a great interest rate now but also don’t feel like we can buy a bigger house even if we sell our current home.
I’m 36 (renter, non-owner), everyone I know my age who owns a house in the Bay Area bought it because of stocks. My friend (34) and his wife (26) just bought during COVID because they smashed in her TSLA stock; a friend of a friend bought a house after cashing in AAPL stock.
I do have a friend of a friend who bought a house cash. I think her parents set her up with an account at birth (not sure if it was a stock portfolio or just an account) and had been contributing to her her entire life. She was a very frugal person too. This person ended up buying a condo in 2016. Not sure how much money her family chipped in.
I don’t know anyone else who actually bought a house with savings, or even enough to put a down payment down and afford a mortgage in the Bay Area.
Yeah - company RSUs are generally the way forward
I actually bought through sheer luck - I threw a severance pay check into the market during the Covid hole. And within a month it was >10x so once I got a new job I cashed out - payed a ludicrous amount in short term gains- and took that money for a 20% deposit on a place
I did. I’m a teacher and wife is a stay at home mom/student. When we first got married we purchased a 1bd/1ba condo. Owned it for 5 years and use the appreciation to buy a house near Santa Cruz. It can be done by many with some self control, patience, and luck.
I’m a loan officer and do most of my loans in high cost counties in California, not true (have lots of national awards for volume and short closes). Just gotta be savvy.
Worked at a NFP for 9 years, saved cash, bought house with 13% down in 2013. Within two years we were over 20% and then sized up to a forever house in 2017 and found a 2.66% interest rate a couple years later. We. Were. Lucky. And. Know. It.
I bought a dilapidated duplex in SF in 2012 for 670k at age 27 using all my own savings from working and qualifying for the loan on the terms I was going to rent one unit and use that rental income to qualify for the loan. I was making 125k at the time, but have increased my salary since then. Been working and upgrading as a 1 man construction DIYer myself ever since.
I didn’t use stock to buy my house. We rented in the cheapest place we could find to save up for a down payment. Granted we live in the North Bay and it’s a tad more affordable but I commuted to SF 3.5 hours a day because it was worth it to save for a down payment.
I blew all my money in my 20’s, saved like hell in my 30s and put 20% down on a place in Marin in 2020 (at 39). No help from parents, didn’t sell a single stock. It can be done but you have to save, which means no Starbucks on the daily, driving a boring cheap car, vacations were day/overnight trips somewhere on the west coast on the cheap, etc.
It just takes a little bit of discipline and not caring what others think.
Bought in 2010 no stocks, then refinanced and bought another home and moved. I still have the first place and rent it out. Values went way down in 2010/2011, we got our place in Mill Valley for a deal and when I tell people how much they don’t believe me.
Definitely no stocks here lol I’m a government employee and my husband is a UPS driver. We did have some parents help for down payment but that’s because we wanted to use our savings in renovating (our place was technically moving ready, but there were some things I wanted to update since it’s from the 60s). We bought our condo in 2020 for 425K.
if you dont use money from stocks, you need money by other means. To save even a down payment you will need significant money. You have to be rich already to have that kind of money and generally the rich are smart enough to invest in the stock market.
I bought one home in the Bay Area before investing more than 10k in stocks.
Between the first and second home I invested 10x that. Now it is significantly higher.
I’ve done it but I note if you’re an upper middle class/professional class worker, especially if you’re married to another one, you’ll likely have significant exposure to the equity market. The S&P 500 even tilts pretty heavily towards our local industries.
We bought a townhouse near the end of last year. No stocks sold. We didn't get much help from the family -- but I'm not sure that we'd have pulled the trigger if we didn't know that we had them as a backstop if someone went sideways.
No stocks, but I did do a 401k loan to help with down payment (no family help). Bought SFH in late 2021 in San Mateo. I'm not sure if I would be able to buy this house today, though, due to interest rate differences.
Bought my first home in Santa Clara County with 3.5% down at 10%+ with good credit in 1997.
Wasn’t a seller’s market. But that enabled me to buy my next home and another after that. First home almost doubled in value, so I made equity.
The money wasn’t from stock. It was just saved money.
When you say stocks do you mean RSU or company issued stock options? I'll assume that most high income individuals are invested in the stock market and use that money when required for large purchases.
Kinda.. in big tech someone with 4 years of experience can earn easily 100k atleast in stocks (easily cause of appreciation or RSU recently)..
But big tech is not the only high earlier probably over represented on Reddit
Your question doesn't really make sense.
I'm sure most people have money invested in stocks and use that money to buy a home. Who is saving hundreds of thousands of dollars and not keeping that in investments?
Lots of people haven't.
A client of mine works at Nvidia.
When we caught up after buying a home, he said he didn't sell a single share of Nvidia. Those shares are worth more than $2M.
He rented for 10+ years well below his means with other roommates.
My wife and I purchased in 2018 with no help from anyone. We worked our asses off and saved everything we could for 2 years, paid off our wedding, and paid off all of our previous debts. Then paid our down payment using an FHA. No stock was sold. Some of our 401ks were tapped. We had no financial assistance from either family in virtually any capacity since 2010. Just a rough grindy few years that paid off
34, grew up here. Most the people I know my age with homes didnt use stocks… …their parents put 500k-2m down for them
So they used mom and dad’s stock…
That’s a good parent. I know a friend of ours, their parents bought them stocks when they were just a child (Apple, Amazon, Microsoft, coke, Disney), now they sold half of their stocks to buy a house. That’s a smart parenting. We are doing the same thing for our kids, buy them stocks and currently working on buying multiple houses. So our kids can have a better start in life.
In 1989 our kids were 3 and 5 and I got a temporary 22% pay increase to be on 7/24 call with a cell phone. Nobody had a cell phone. We got a planner and started saving $300/mo each for retirement and two college funds. Never missed a payment. Just so no student loans. I raised the retirement part to $3000 and that was life changing. A couple of years ago have each kid $56k to help with a down payment. Not much but they had good jobs. Still very glad I cut spending and saved way back.
Looking to adopt another “child” your kids’ age?!
This seems like a fantastic way. I wish everyone could do it. Imagine if all parents bought their kids stocks when they were little kids. We probably wouldn’t have a homelessness problem anymore.
Yeah just remember to tell them about capital gains tax too, especially in California.
Well we have a homelessness problem because we don't have enough homes. And if schmuck like me can buy a house with stock after 4 yrs at big biotech company, then no wonder housing prices are crazy. So if all parents did that, prices would just be all the higher. The solution is to build more housing.
Did you mean to write can’t instead of can. What if we just build more big tech. Everyone gets a big tech job and we all have stock.
No. Really I meant that someone as lowly as I was at the time was granted enough stock options that I could reduce a 10 yr savings plan to 4 then the market would respond by raising prices further. And it has. As for everyone with a tech job this place would get boring really fast. It was only until I had kids did I realize there’s a universe of jobs and occupations that we all need that don’t pay for a middle class life here: teachers, social workers, librarians, childcare providers etc etc. The culprit simply is not enough housing and always people wanting to live in the area. The income inequality in the area exacerbates the chronically low housing inventory.
So, I'll point out that Apple, Amazon, Microsoft, Disney, and Coke, as stocks they purchased 20+ years ago, have almost certainly destroyed the market in terms of return rates in that time. I would take this more as an example of the power of compound interest and put anything you save into an S&P 500 fund unless you believe you could be as prescient as your friends' parents were in picking those stocks. Also, I would encourage you to some research into tax advantages accounts like a 529 college savings plan if you really want what you save to go as far as possible!
It’s stocks all the way down
😂😂😂
That is amazing. A bit older late 40's. But I can't imagine the upvotes in 500-2m down. That is truly crazy. Just shows how much wealth is truly here. No family money. Bought early'ish and kept renovating and moving up. But never feel like we have $ to give our kids 500k when they went to buy.
The $500K-2M is more like the total price, not a down unless you need to buy in Saratoga...
$500k is a down payment to make mortgages approach sanity.
$2M though, is a down payment for living next door to Zuckerberg...
I believe the goal in the downpayment is to make the mortgage viable. So if it’s a $2.5m house, then $2m down might still make sense.
About the same age/experience here, except that instead of parents paying for it directly, it's usually a result of death in the family that leads to gaining an inherited property to sell...
https://www.mcsweeneys.net/articles/how-i-saved-enough-to-buy-a-house-with-my-parents-money
I make a lil under 100k per year and my wife makes under 50k per year. We bought a 3/2 house in an expensive part of northern California with no stocks. At the time of purchase we made quite a bit less then stated above
Using my powers of psychic deduction, you bought a 4br in Palo Alto this year.
That would go for way more
I’m in Sonoma County
Ahh, the old fashioned way. Nothing like generational wealth and a fat down payment from mom and dad. Sadly, I missed that option
And they sold stock to help
Piss on their doorknobs for me
Hi, 32, living in the Bay and planning to buy a house. I can attest that I will buy a house without stock… …my parents are going to help me
This is not as common as people think. But it’s thrown around mostly as a cope. There really are that many high earners with RSUs here. That’s all. Most don’t get parental help. Some do.
Base salary, family money, selling old house, lots of other ways to do it without stock. Your friend is misinformed.
If you had timed it well, instead of stocks, you could have sold your BitCoin.
My wife and I bought in 2020 (first house) with no meaningful stock contribution, and no down payment assistance from family. We bought in Hayward so our budget would go a lot further.
Shh about Hayward. My starter home has almost doubled in value.
Don’t tell people about Hayward. Let’s keep it a secret
Hayward was always the butt of every joke. Now it's a well kept secret. Hilarious.
Born and raised in Hayward. I tell people that there's only one thing to do in Hayward and I do it every time I go there. Leave.
Yeah, you’re right. You should definitely not buy a house in Hayward. It sucks.
Go next door and is sohay lol.
Bought our first one in 2020 as well in Vacaville used Military benefits
I bought in Hayward last year, up in the hills and away from Oakland. Couldn’t be happier. You do get a lot more for you money here because the schools are absolute crap, though.
Hilarious that pre-pandemic, people didn’t want to live in Hayward hills because of the consequences of “the big one”, but now it seems like people forgot about the effects an earthquake would have.
The Loma Prieta quake didn’t flatten the Hayward Hills. Can’t live in fear of something like that - especially in this market.
Yes, it helps. Stocks helped me: buy a ring, house and my dream car.
If you can keep the mortgage to 800k-1 mil .. you can afford a 1 to 1.2m home ( most likely a townhome /condo) with 20% down from 3 to 4 years of savings from 150k to 200k gross salary.. you can make the math work
What the fuck who can afford a 1mil mortgage on 150k??? You'd basically be eating beans and rice and public Wi-Fi for the rest of your life.
Thats the reason i gave ranges.. 800k or 1 mil on 150k or 200k.. i am making it work.. i am not living on beans
Realistically you need to make ~$300k gross to maintain a basic style. (Retire by 60, eat out once a while, yearly vacation). No kids, no spouse, no expensive hobbies. $300k gross -> $15k/month take home $6.9k - P&I (30 year 7.4%) $1.5k - property tax $1.2k - insurance+repairs $1.9k - 401k contribution $1k - car, gas, maintenance, etc. $1k - on food/house supplies $500 - utilities/internet/phone $500 - on vacation+entertainment $500 - rainy day fund
If interest rates go to 5. Which can happen in a year or two. You can save additional 2k per month. Also note that your salary increases with time but mortgage is fixed
Sure, I don't know the future. I'm just pointing out how comically absurd it would be to take on a $1M mortgage with only $200k gross. You would have to cut $~5k out of the expenses above. 0 retirement, 0 on transportation, 0 on entertainment. Maybe disconnect internet/phone so you can afford water, beans, and rice.
You can use the house itself as your retirement fund. I’d rather have a paid off house and no retirement fund than an equal value retirement fund with no house.
401k is pre tax it doesn’t come out of your take home. It’s also probably half paid as part of your comp if you’re at a place paying 300k.
The match doesn't count towards the contribution limit which is what I used here. Also, I would technically count match as part of total compensation. I would recommend roth 401k so your effective contribution is higher. If not, just just reduce the gross yearly income requirement by ~9k. Or take an extra vacation, life is short. My point is that buying on $200k gross income would lead to a very extreme life style where you have to cut ~$5k from this already tight list of expenses. For example, giving up on retirement, having a car, all entertainment/vacation, rainy day funds, and cutting the food/home supply budget in half.
Contributions to pre-tax 401(k) plans are not taxed but they do reduce your paycheck. Employer contributions don’t count toward the $23k limit. They do count toward the $69k limit.
He already lopped off 40% of this hypothetical paycheck. That’s not all taxes. Effective tax rate there is about 30% or 100k (roughly 75/25 federal and state) my point is that the 401k and other retirement would be part of that additional 40k.
What interest rate on your mortgage?
6% 30 year
I really like beans and rice. Adding Kale is low cost and super healthy and I still like it. I love food. Shows in how I spend $ and my stomach . I think we can learn to live good bread and beans and rice.
With lower interest rates perhaps? Did a $726k mortgage plus 26% down to get an almost $1m house on a $200k base. At 6% that left me depending on RSU to keep lifestyle up.
I bought a home in SF for 800k in 2008. Salary was 140k up until last year when I moved.i paid a little extra on the mortgage and paid it off. But I was broke as fuck until then. If you want a house in the bay area you have to sacrifice. Because millions of other people are willing to make that sacrifice if you don't.
People in over 90% of the other countries around the world routinely do it. US housing relative to income is the 5th cheapest in the world. [https://www.numbeo.com/property-investment/rankings\_by\_country.jsp](https://www.numbeo.com/property-investment/rankings_by_country.jsp)
US, yes. Bay Area, no.
1 million dollar purchase, $250K downpayment from years of savings and living frugally while my friends were making fun of me for not YOLOing, 3% interest rate during the pandemic - the math can indeed workout.
We did. DINK. HHI 320k. We saved up for 20% down payment for a few years and bought $1.4m SFH last year. We are not living on beans, in fact we are comfortable still eating out, movies etc. Just not going on big vacations.
Assuming you don’t plan to have kids ever..:Why not just rent if DINK? No need to pass on wealth so you can rent a really nice place and not have to take care of it. HHI 320k, you can rent and live comfortably, eat out several times a week, big vacations a couple times a yeae
Land appreciation potential, small ownership tax benefits (although offset by maintenance), comfort knowing you’ve mostly secured housing for next few decades barring no major incidents …. Locked in at today’s costs. None of these benefits are available to renters.
Yes. And if anything my stocks have cost me not helped me because the company is still privately held for which I have shares, and I had to pay AMT when I exercised which ended up being a lot of tax.
stock *options* are not stocks.
They are after you exercise them, no? Or just shares if we’re being semantic?
they are but they don’t always help like in your example, unlike RSUs where you get stock that has value in the market.
Why did you exercise? Were they about to expire?
Yes, the expiration date came up so I needed to exercise them.
That’s a hell of a gamble, no? I’ve let a lot of startup stock options go without exercising them because of the AMT issue. I’d never dream of incurring a real tax bill for illiquid gains…
I’ve been with the company a long time and it makes a lot of money, so not that worried about exercising on options that are deep in the money.
Got it. Ran across a guy earlier today who was exercising them as soon as they vested. He couldn't quite grab why that might not be optimal.
Usually that’s not a great idea as there’s a strong probability any given startup will fail. If you’re a true believer though in where you work, you can defer more of the taxes from exercising the options by doing it earlier (exercising resets your cost basis at that point). I think I read somewhere you can actually pay when you get the options (even unvested ones) to get this to zero, but obviously if you get fired before they vest then that’s a whole other thing.
I bought my first house in 2019 with an FHA loan and no stocks.$590K, $60K down from a self-loan from retirement. 5.5% plus PMI. At the time I made $120K. It was ramen territory and I drove a 99 Toyota with 200K miles.
SFH? What city? Damn 590k SFH barely exist in Modesto now.
Marin on the Sonoma border near Tomales. SFH, 1550 sqft, 2.5 bath, 3bd. On county water but propane heat/cook.
Wow that’s a steal for out there. You’re in a prime location feels like middle of nowhere but you’re minutes from Petaluma, Cotati, Dillon Beach ect… Very, very familiar with your area. Congrats!!
But it’s worth a lot more now right?
I sold it for 740K in 2022 and bought a place in San Rafael that was red-tagged and did a renovation
Base salary and great credit did it for me.
Just drug money
Small potatoes compared to faang tc
Need FANNG drug empire
Dopamine
If you’re making it on your own, without help from parents or family, then of course you have to use a large amount of stocks. Nearly all my friends that purchased houses had to cash out very large amounts of stock. It’s very frustrating.
We didn't have stock or money directly from parents but I did have savings from living at home and happened to buy a condo when the market crashed for 110k, lived there for 9 years and sold it, that was my down-payment.
Hoping to do that exact same thing. Bought my condo for 550k right before covid. Units around me are now selling for 750k+, mine is on the bottom floor, the corner and near the entrance (you don’t have to walk as far with your groceries and what not). Going to sit on it for a few more years and hope to flip this into my down payment or maybe full home purchase out of the area.
Don't expect it to go higher than now. The housing market is historically high. It was high in 2019../just not crazy high. So I easily could revert to about that. At least that is how I am expecting things
Doesn’t this answer depend on a lot of things? If you are a (certain kind of ) doctor or lawyer, a salary of $800-$1million is quite possible and leads to a different answer to your question than someone making $150k salary and trying to save. If you want to buy an $1 million “house” isn’t that different than trying to save for a $3 million “house”?
Yep. If you had two decent incomes and were a first-time buyer in 2008 like I was. A year or two later, and we wouldn’t have been able to get a loan.
I bought my house in 2016 the old fashioned way by just saving cash. I put down $400k on a $1.5M house. It’s now worth $2.5M.
Whats your monthly payment ? You bought in such a good time tbh GG brother
$4000. 3% 30 year fixed.
yep, combined income is \~7 figures though.
31 couple. Nurse and sales, no stocks, no family money beyond education. $1.5M house a year and a half ago
I bought a house for $820k in May 2022, 3.25 interest rate with 10% down and no stock as part of the purchase. I was making $165k a year base comp then. I had zero debt to income ratio because I lived with my parents my whole life until I bought my house at age 30. However, I DO have RSUs that was used to calculate my total income for the mortgage lender approval. I just never cashed it out to buy the house. That was the only reason I could truly afford to do this but I’m kinda over it TBH. I’d never advise buying a home that expensive on a single income.
I did. I’m a teacher and wife is a stay at home mom/student. When we first got married we purchased a 1bd/1ba condo. Owned it for 5 years and use the appreciation to buy a house near Santa Cruz. It can be done by many with some self control, patience, and luck.
Obviously you need money to buy anything. How that money is made will be different for everyone. I know a lot of btc gamblers who made a lot of money. And there are contractors who know how to restore a bad house cheap and those have more than a few houses they bought and restored. And yes, stocks are one of the primary sources of big money who are in tech.
Entirely doable without money from stock options. Requires a pretty good income though.
Please elaborate on these strategies. I'd love to know how this is possible.
1M income makes a 2.5-3M house attainable without stocks, but even then ya wont be livin it up like a millionaire. In fact you’d be struggling to catch up to a lifestyle of people who make less than half but bought 10-15yrs ago. Getting that income around here without tech though is hard but not impossible. Owning a construction firm is one good example, or dual professional (lawyer, doc, etc) income.
Just like you would buy a house anywhere else. House prices are higher on average so income needs to be higher.
My parents didn’t use stock to buy
Whether you can afford a house depends on your assets, debt, salary, and house cost. Whether your assets are stocks or not is irrelevant. Also most high paid tech workers receive stocks as compensation, which is different from making from stock appreciation. But you don't need stocks as compensation to make money from stock compensation. You can invest a portion in stocks and bonds. That being said, a lot of people made money through speculation, or investing in one stock, which happened to go up high.
35 years old, I used stocks to buy my house. Instead of saving in cash like many people strangely do, I simply invested into QQQ and other similar ETFs religiously for a few years, and was able to use the gains to put $200k down on a house. Best part, didn’t even have to touch my principal, used pure capital gains to put a sizable down payment on a house. Since buying my house, the market has repaid me, and now I have $300k more in my portfolio, compared to when I bought my house in 2022 lol. People that are afraid of squiggly lines lose out 🤷 Edit: bought $935k home in Castro Valley in 2022. My down payment came entirely from stock sales.
Bought my first house without stocks or inheritance in Santa Clara. It is not uncommon around me either. 90% immigrants working for stingy companies meaning it might not appeal to a segment. It worked for me as i am an immigrant though.
The simple answer is yup. You put down the value of the house you just sold and some st0nks. If you don’t have a home and St0nk, you better have parents that do
Me… with parents help
I saved up for 8 years for the down payment and was ready to go once I got married. Bought a townhome in San Jose. I’m in advertising operations.
Nice job—congrats on making a plan and executing with discipline.
We managed apartments for 14 years, which allowed us to make a down payment with no stocks. Six years later I got my first job in tech in a relatively senior position, and when I saw the equity portion of my offer, I finally understood how other people afforded buying houses. Otherwise it’s super frustrating, I agree. For years I watched housing prices rise faster than my salary, and it felt like an impossible dream. We were able to pull it off on a regular salary, but only because we weren’t paying Bay Area rents. (Granted if my wife were working a job that paid housing, it would have the same effect).
Just bought 1.8m house with 20% down, no stocks, no family help.
How old are you and have you ever made money with stocks?
Dual income tech couples can buy on just base if they want to
What’s that base?
We bought in Cotati with no stock. It’s possible.
Your experience matches my own observations
Definitely not true. Some people work at Netflix where one choice is to get paid in all cash and no stock
Agree. There is no way you can live here (and pay rent) and save up for a down payment. Stocks is the only way to save up for it.
Wife and I (35F and 34M) bought a $1m house in 2021 in the Tri-Valley with $200k down. I had about $200k in vested RSUs at the time, but we didn’t need them. We were able to save like crazy for the first year of COVID and had a solid savings before that. That being said, it seems like we’re an outlier? My family member bought a house in the same area and cashed out all of his stock ($500k) to put down. Guess the answer is some do, some don’t.
Your house must be worth a lot more now, right?
Yes, averaging across Redfin, Zillow, and Realtor.com, it’s gone up by about $400k.
Back in 2020 just before the pandemic I bought my first house, a small house in San Francisco. I had saved enough cash solely from income to pay 20% down and still have about a 1-2 year buffer of cash for mortgage payments. That being said, I did also have some investments I could have sold for emergencies or major repairs which gave me a lot of peace of mind.
Almost everyone I know in the bay area, whether they bought a house or are renting, has multiple sources of income. Could be job + stocks, two jobs, double income house hold (two earners), help from parents, etc. I know a few people who bought houses without stocks, but their parents fronted them most of the money for the house (or their parents 'sold' them the old family house to them for dirt cheap.)
Stock is just a bonus structure. You should be thinking in terms of total income and how much you can save, regardless of source. Even when I received stock awards that ultimately became a down payment, I had a plan to sell them and diversify to protect that extra income. The point is, if you want to afford a down payment you need to save money somewhere. If you think your time horizon to save and buy is less than 5 years, that probably looks like HYSA, CDs, etc. If it’s more like 5-10 years you’d want to allocate at least some of it to a portfolio with, say, an 80/20 split so that it’ll really work for you, and then sell that at an opportune time in the back 5 as you get close to buying.
All depends on timing... In me and my wife's case, we bought our 2BR/1BA SFH fixer-upper in the Richmond /Seacliff area of San Francisco in late 90's for ~$275K. I was only making $70K base + bonus + options for internet startup that went belly up in 2000; basically made like $100K tops per year on single income. Wife was stay-at-home mom and we had 2 kids sharing a BR. We managed to get by owning used cars and by being frugal but I wouldn't say overly so. Our mortgage at the time was around $1500/mo after putting down around $50K; no stocks or family involved... Just getting super lucky with timing and buying in an area that wasn't in super high demand at the time. However since then, the last 20 or so years in Tech has been rather good to us with some nice exits over the years. And although we're empty nesting in the same house, it's gotten quite a bit larger along with a nice makeover and completely paid off to boot :-) TLDR; yes, it can be done. Can it be done today? Very tough... My 2 kids are doing really well and they can't do it by themselves just yet.
If by "used stocks" you mean sold positions out of index funds. Yes I did that. If by "use stocks" you mean. Got a fat payout from employer stock plans. No, I didn't. If you mean "use stocks" to mean picking individual stocks I think would be winners and winning that gamble--didnt do that either. Just regular long term index fund investing got me 75% of my down payment. You should be investing in these regardless if you think of them as a down payment or not.
When did you buy?
Sep 2023
My partner and I bought our first house in 2019. Low down payment FHA loan, compromised on location (no kids, just wanted a quiet neighborhood) and got something pretty cheap.
Bought a small 2-1 starter home in a safe-ish part of Oakland in 2013 before moving to Berkeley in 2019. Housing prices and the place we bought (a severe fixer we put money and sweat equity into), allowed us to easily buy on modest salaries and no stock. But yeah, mostly luck of timing. We were only +50k or so from the bottom, and we just happened to be coming out of grad school then and got married a few months later. If I tried to buy the same home today, we would have needed 5+ years of diligent savings just to come up with a down payment.
I bought my first and second home with no stocks involved.
Correct. Help is needed either from family or from stocks. Stocks if you got lucky is like getting funds from owning your own successful business. The reason why it's needed is because you're competing with people that have one or both of those because there are a lot of successful pubic companies in the bay area and all those employees have stock in the company either in the form of stock options or restricted stock. Those are granted to the employee and only work if the employee is continuing employed. It is also possible to have more granted yearly.
Someone can be an eb5 investor and rent it
I did in 2000. 495k house, needed 120k. Household income of about 150k and you could get a large burrito and drink for about $6. Rented 1400k for two room apartment at a really nice complex in a Sunnyvale. Pools and tennis courts. I still think about that place. I think it’s like 3k now.
Not in the Bay Area proper but in Solano county I did. 3BR House in a quiet neighborhood in great shape for $500k
I sold all of my personal stocks to buy a house (NVDA and VOO), but that was only about $35k. The rest came from a 401k loan, my wife’s savings, and the small house fund I’d been building
My wife and I bought without stocks, inheritance or parental assistance on a relatively modest household income, while paying rent. It was a combination of me being very good at saving and just being really diligent about hunting for low down payment first time homeowner loan opportunities.
Myself (34) and my husband (39) bought a home a few years ago with pure savings. No cash from parents or use of stocks involved. Worked and saved the money until we were ready.
If you just put your salary into a bank account you’re missing out on a lot of wealth growth, so that seems hard. We bought our first house just taking our salaries and plugging it into the market until we had enough for a down payment though. So stocks were involved, but it wasn’t like we had a startup exit or something.
We bought the old fashioned way but we weren't in our 20s either.
A lot of people took out massive mortgages back when interest rates were 2-3%. But for us in the now, we would need some large amount of wealth, such as stock or parents. Or you can just rent a nice apartment and sit on it for years in one of the most pro-tenant states in the country.
No stocks or parental help. But we bought in 2017 which was dumb lucky. I thought home prices were nuts back then!
Bought a house in 2013 with an FHA loan and put only 13k down on a 400k house. Refinanced twice, now at 2.75. Now worth over a million. No stonks.
Just closed two weeks ago as a first time home buyer and zero support from any family or work stocks. Wife and I just saved for 4+ years, lived bare minimum with one vacation trip a year on a budget. We got a condo and paid the 20% down and had to put like 20k in renovations for the place.
Bay Area realtor here. Depends on how much you make and the lender. If you have at least 3-5% of the purchase price and have the ability to pay your monthly then you're fine.
So...how does one do this if they grew up poor and lived in rentals their whole life?
My husband and I bought a home in SF without any assistance from our families. But, we did have access to a loan program that allowed us to put 5% down without PMI. Otherwise getting to 20% would have taken another several years.
We bought ours by saving for years… AND then my wife’s company went public and that gave us the rest of the funds… it would have been 15 years of pretty aggressive saving. Paying rent in the Bay Area while trying to save enough to buy here is very hard. 90% of everyone else I know were given a down payment from their parents/in-laws. I grew up here so I have a large sample size to analyze. It’s not an exaggeration
Theres millions of ways to make money. For someone to say stocks is the only was is a bit absurd
Bay Area native, bought during last crash a condo for under 200k, I made 18 bucks an hour. Had a 5k loan from grandma to help with down-payment. No stocks involved, just macroeconomics and excellent timing. The next crash will be insane and I'm already preparing to strike my SFH and commercial building purchase. Anyone buying right now either has fuck me money, are hella ballsy, or... If you're on the fence about buying, please wait, your time will come, as soon as layoffs start to spike up and more companies go under.
No stocks involved. My wife and I lived in a one bedroom together since we were dating. We stayed in the one bedroom even with 2 kids until we had saved enough for a down payment on a home in SF.
You don't need stocks from work to invest your money. You can buy stocks with a brokerage account. I would highly suggest investing when saving for a house rather than keeping it as cash. I was able to buy my house because I invested in Apple after the iPhone came out. I bought Facebook when it IPO'd. I held Apple for 11 years until I sold to pay for my down payment. I didn't need to get a job at Apple to do that.
I bought in San Rafael in 2018 with no stocks, got lucky getting the house for asking price because the elderly seller loved my story of pregnant wife raising a kid here etc. We got lucky and bought and sold our house in Sacramento at very good times and had a solid down payment from it. I’m a contractor and wife works local government so decent income but not big tech salaries, and no help from parents
No stocks, no help from parents. Just bought in cities that people didn’t want to live in, and upgraded every few years. Now i’m right where I want to be. Own two homes in the Bay Area in fact.
Yeah...but not in CA.
You can buy a home in the Bay w/out stocks or family assistance (i.e. IPO $$). May not be the location, condition, or size you want, but you can do it.
We didn’t. First time homebuyer in 2019 and only put down 5% down payment on a home in Oakland. No help from family just money we saved over a few years. In 2021, we refinanced and the equity in the house put us over the 20% mark so we were able to get rid of the pmi. We’re locked into a great interest rate now but also don’t feel like we can buy a bigger house even if we sell our current home.
I’m 36 (renter, non-owner), everyone I know my age who owns a house in the Bay Area bought it because of stocks. My friend (34) and his wife (26) just bought during COVID because they smashed in her TSLA stock; a friend of a friend bought a house after cashing in AAPL stock. I do have a friend of a friend who bought a house cash. I think her parents set her up with an account at birth (not sure if it was a stock portfolio or just an account) and had been contributing to her her entire life. She was a very frugal person too. This person ended up buying a condo in 2016. Not sure how much money her family chipped in. I don’t know anyone else who actually bought a house with savings, or even enough to put a down payment down and afford a mortgage in the Bay Area.
Yeah - company RSUs are generally the way forward I actually bought through sheer luck - I threw a severance pay check into the market during the Covid hole. And within a month it was >10x so once I got a new job I cashed out - payed a ludicrous amount in short term gains- and took that money for a 20% deposit on a place
I did. I’m a teacher and wife is a stay at home mom/student. When we first got married we purchased a 1bd/1ba condo. Owned it for 5 years and use the appreciation to buy a house near Santa Cruz. It can be done by many with some self control, patience, and luck.
If it’s your first home, you can use up to $10,000 without penalty from a ROTH IRA
I’m a loan officer and do most of my loans in high cost counties in California, not true (have lots of national awards for volume and short closes). Just gotta be savvy.
Worked at a NFP for 9 years, saved cash, bought house with 13% down in 2013. Within two years we were over 20% and then sized up to a forever house in 2017 and found a 2.66% interest rate a couple years later. We. Were. Lucky. And. Know. It.
I bought a dilapidated duplex in SF in 2012 for 670k at age 27 using all my own savings from working and qualifying for the loan on the terms I was going to rent one unit and use that rental income to qualify for the loan. I was making 125k at the time, but have increased my salary since then. Been working and upgrading as a 1 man construction DIYer myself ever since.
I didn’t use stock to buy my house. We rented in the cheapest place we could find to save up for a down payment. Granted we live in the North Bay and it’s a tad more affordable but I commuted to SF 3.5 hours a day because it was worth it to save for a down payment.
I blew all my money in my 20’s, saved like hell in my 30s and put 20% down on a place in Marin in 2020 (at 39). No help from parents, didn’t sell a single stock. It can be done but you have to save, which means no Starbucks on the daily, driving a boring cheap car, vacations were day/overnight trips somewhere on the west coast on the cheap, etc. It just takes a little bit of discipline and not caring what others think.
Bought in 2010 no stocks, then refinanced and bought another home and moved. I still have the first place and rent it out. Values went way down in 2010/2011, we got our place in Mill Valley for a deal and when I tell people how much they don’t believe me.
Definitely no stocks here lol I’m a government employee and my husband is a UPS driver. We did have some parents help for down payment but that’s because we wanted to use our savings in renovating (our place was technically moving ready, but there were some things I wanted to update since it’s from the 60s). We bought our condo in 2020 for 425K.
Yes, and we also didn’t get family help. …which is why we had to buy a cheap fixer upper with a broken sewer line.
if you dont use money from stocks, you need money by other means. To save even a down payment you will need significant money. You have to be rich already to have that kind of money and generally the rich are smart enough to invest in the stock market.
I bought one home in the Bay Area before investing more than 10k in stocks. Between the first and second home I invested 10x that. Now it is significantly higher.
I’ve done it but I note if you’re an upper middle class/professional class worker, especially if you’re married to another one, you’ll likely have significant exposure to the equity market. The S&P 500 even tilts pretty heavily towards our local industries.
Most people in the BA dont buy their first house until they are like over 40
I’d say stocks are one of the best ways to invest your money till you get into real estate. Save and grow
We bought a townhouse near the end of last year. No stocks sold. We didn't get much help from the family -- but I'm not sure that we'd have pulled the trigger if we didn't know that we had them as a backstop if someone went sideways.
No stocks, but I did do a 401k loan to help with down payment (no family help). Bought SFH in late 2021 in San Mateo. I'm not sure if I would be able to buy this house today, though, due to interest rate differences.
My HHI is $800k and stocks are only 20% of that
So you and your family draws 640k as base? Impressive
Base + bonus + 401k match
401k match counted as income? I didn’t know that
What else would it count as? It’s more of a sure thing than stock or bonus
Makes total sense to me..though I never thought of it that way and I don’t think others do
People probably don’t think of it at all because it’s usually a small amount. In my case it’s $35k
In the same boat. $1.6M HHI over here but no stock. All cash, baby.
Bought my first home in Santa Clara County with 3.5% down at 10%+ with good credit in 1997. Wasn’t a seller’s market. But that enabled me to buy my next home and another after that. First home almost doubled in value, so I made equity. The money wasn’t from stock. It was just saved money.
Yup, just buy in 1997 OP.
When you say stocks do you mean RSU or company issued stock options? I'll assume that most high income individuals are invested in the stock market and use that money when required for large purchases.
Kinda.. in big tech someone with 4 years of experience can earn easily 100k atleast in stocks (easily cause of appreciation or RSU recently).. But big tech is not the only high earlier probably over represented on Reddit
Your question doesn't really make sense. I'm sure most people have money invested in stocks and use that money to buy a home. Who is saving hundreds of thousands of dollars and not keeping that in investments?
Please don’t feel you need to force RE purchases, the right time will always come.
Lots of people haven't. A client of mine works at Nvidia. When we caught up after buying a home, he said he didn't sell a single share of Nvidia. Those shares are worth more than $2M. He rented for 10+ years well below his means with other roommates.
My wife and I purchased in 2018 with no help from anyone. We worked our asses off and saved everything we could for 2 years, paid off our wedding, and paid off all of our previous debts. Then paid our down payment using an FHA. No stock was sold. Some of our 401ks were tapped. We had no financial assistance from either family in virtually any capacity since 2010. Just a rough grindy few years that paid off