Two Months as Homeowners: Update

by Erika Torres

Eric and I have been homeowners for two months now and I thought I would give an update on the reality of it.

For us, it has absolutely been a dream come true.

We live in an expensive housing market. In fact, the third priciest housing market in the United States, behind only San Francisco and San Jose.

Almost 5 years ago, when we first got married, we were earning less than half the income we make now.

At that time, prices were the cheapest they had been in a decade, and it hurt so much to not be able to afford our own place. We had to pay off our debt first, work on our careers, and save up for a down payment. That we were able to accomplish all this in less than 5 years?

It absolutely shocks and awes me.

Eric and I have always wanted to be homeowners–and this is where we may differ from many other personal finance bloggers.

While we fully acknowledge that a house is a substantial financial investment, we were really buying a home.  We love to entertain, we love to host parties and have friends over, and we hope to build many, many, many memories in our home with family and friends.

So while we know that a home is of course a financial investment, we don’t believe that everything is about money. Because, yes, there are absolutely things that money can’t buy, and we get an immense amount of joy and pride in being homeowners.

When it comes to homeownership, I think there are a few ways we differ from the average homebuyer….

Homeownership is a dream

While homeownership may be a dream, or goal, for many other people, if Eric and I lived in, say, Cleveland, Ohio where the median home sales price is $58,000, then homeownership wouldn’t be a goal for us, it would be something to check off our list because it wouldn’t be that much of a financial commitment for us–we’d just pay for the house in cash.

And similarly, when I see other people buying homes for $200, 300K, I think how nice that must be! At those prices, I feel it would be much, much easier for us to purchase a home. So for us, homeownership really was a dream that five years ago, we didn’t even know if we would ever be able to afford to buy.

It’s not just about money

For us, it is a big financial commitment to purchase a home, much more so than if we were simply paying $200 or $300K for a single family home. At this point in the housing market in our area, you have to really consider your home more than just a financial investment–because housing prices are expensive, and the OC rental market is at an all-time high as well.

But I just don’t see it getting any better any time soon. I feel that when you live in an expensive area, housing will always be pretty expensive and out of reach for many.

We don’t have to worry about retirement

One thing that I don’t talk about much is retirement–because frankly, Eric and I are both pretty secure with retirement because of our pensions. At this point, if Eric and I both retire at 55, I will receive 70% of my salary for the rest of my life and Eric will make 75% of his salary for the rest of his life.

This means we only have to worry about covering less than a third of our income, assuming we don’t change our lifestyle. With 10% of my annual salary in a 401k-type account, and maxing out our Roth IRAs, we’re pretty financially covered–and we have our financial adviser to back us up on this to assure us that we are more than fine.

This means that instead of putting money toward retirement, we have more income that can go toward other investments, disposable income, and of course, our home.

We don’t want to die rich

Eric and I have no intention of dying rich. We want to leave something behind for our children, and make sure they don’t have to worry about paying for our funeral expenses (dying is expensive!), but other than that, we want to enjoy the money we earn. Work hard, play harder is our motto.

We have no plans of being millionaires in our 80s, when we can go ahead and enjoy the money we make now.


Eric and I are absolutely happy with being homeowners. It is absolutely everything we had hoped for.








Courtney Watson January 23, 2015 - 11:36 am

Congratulations on home ownership. I have been reading your blog for a few years now and enjoyed learning about your journey. I also have great admiration for your finanicial discipline. I am a 2 time homeowner and always felt it better to buy than rent, if that is a possibility for you.
However, I will say one thing that bothered me with this post. This paragraph, “While homeownership may be a dream, or goal, for many other people, if Eric and I lived in, say, Cleveland, Ohio where the median home sales price is $58,000, then homeownership wouldn’t be a goal for us, it would be something to check off our list because it wouldn’t be that much of a financial commitment for us–we’d just pay for the house in cash.

And similarly, when I see other people buying homes for $200, 300K, I think how nice that must be! At those prices, I feel it would be much, much easier for us to purchase a home. So for us, homeownership really was a dream that five years ago, we didn’t even know if we would ever be able to afford to buy.”

I think you might have a different view if you were someone who lived in these cities where the housing market is different. While it may seem “cheap” to you, the cost of living in these cities and states is very different from where you live. I am willing to bet that the salaries would much lower, thus people would be and are in the same predicament money-wise when it comes to buying a home. That part seemed a little glib and insensitive – not in a malicious way, of course but just not well- thought out. I live in Texas where the housing market is much cheaper but what, for example, a RN makes here is about half of what a RN in California might make. Buying home would be a dream for that person and not just something to “check off” their list.
Again, congratulations on buying your home! It is something that I dreamed about here in Texas and worked hard for. I am very thankful to have achieved it.
Hope you guys throw a rockin’ house party! 🙂

Misty January 23, 2015 - 12:02 pm

That thought crossed my mind as well but I just took it in the spirit in which it was meant. But I totally get your point. My salary if I lived in the greater Los Angeles area would be 4x what I currently make, thus making me able to afford a house 4x more expensive, say in the $800-900k range.

newlywedsonabudget January 25, 2015 - 6:27 pm

While it’s true that salaries in L.A. are higher than other areas of the country, there are very few jobs (and none that I can think of) where the salary is 4x in L.A. compared to other LCOL areas. With my job, I know I could still make about 60-70% of what I currently make in other places, simply because I have interviewed in other areas, and been offered decent salaries. The thing with HCOL areas is that the cost of living is significantly higher but the salaries don’t necessarily match the cost of living. So a higher portion of your salary goes toward living costs, like gas, food, rent, utilities in comparison to other areas. If the salaries really did match the cost of living, nobody would be complaining about the prices, right?

newlywedsonabudget January 23, 2015 - 1:09 pm

Courtney, thank you so much for commenting, and I’m impressed you’ve been following along for such a long time! I think I would have given up on me a long time ago, haha.

I wanted to clarify where I was coming from on this post. I have become very …disillusioned? with the personal finance blog community in recent months. I feel that every post I’ve read on homeownership has been about all the rules– ie don’t buy unless you have 20% down payment, don’t buy unless your payment is less than 20% of your expenses, don’t put money into fixing up your home, don’t buy if you can’t pay off the mortgage in 15 years, don’t buy if it’s cheaper to rent, don’t buy a house just bc you want a home bc it should really be an investment, etc, etc, etc.

It seems to me that in the personal finance community, everything is about MONEY and very few ever take into account anything else. It’s like if you buy a house because you want a HOME, you’re doomed for failure and you’re oviously doing it wrong and must be one of those millennials who is just racking up the debt and mismanaging money and living beyond your means.

Honestly? It’s exhausting and disheartening. For us, buying a home was a dream that we cared more about than saving 50% of our pay by staying in a rental. And it seems that because it was a dream, and not a sound financial investment, that it is wrong, according to bloggers.

Why should I care what they think, right? But it bugged me, and frankly, I just got so over reading about the money aspect and wanted to make a case for homeownership that is beyond money.

Somehow this post was supposed to be my justification and of course home ownership can be a dream for MANY–no matter what financial commitment it may be.

For us, we have more goals in life than simply being retired millionaires. And that really is the bottom line I was trying to get across : )

Reply January 27, 2015 - 10:35 am

I understand. Home ownership – something that I OWN and cannot be taken away from me – is very important to me! So happy for you and your hubby and I can’t wait to read more posts about your experiences. You are inspirational!

Colleen February 22, 2015 - 11:39 am

I thought the same thing about your Cleveland comment. I am a lifelong Ohio resident, and my $300k house in Ohio would probably be about $900k in OC. However my salary would also be about 3x’s the amount and I would be able to afford that $900k home. I don’t think you really thought your comments through, as you and Eric would make much less income in the mid-west. Regardless of where you live, buying a home is a dream and something to be proud of. Congrats.

newlywedsonabudget February 23, 2015 - 8:18 am

The idea that salaries are equal to the cost of living in HCOL areas is a farse. That’s just NOT how it works. ANd if you don’t believe me, here is proof: If you make $50K in Ohio, your salary in Orange COunty would be about $73K, which is not even close to double or triple the salary. IF you live in L.A., a $50K Ohio salary would equal $66K. So this whole idea that you would make 3x as much and afford a $900K house is laughable. That’s why it’s called a High cost of living area, because a much greater portion of your salary goes toward living costs.
I didn’t mean that it isn’t a dream or it isn’t a goal for others to afford houses of their own, but just that it is much more of a struggle and sacrifice to afford a home in a HCOL area.

Reply January 23, 2015 - 5:04 am

Great job on the house deal! I’m glad you love it. Owning is so much better than renting- you get to make it your own.

Chonce January 22, 2015 - 6:40 pm

Congrats on the new house!! Looks like you did a wonderful job of making your dream a reality now you get to enjoy the benefits! Glad to see you have retirement all planned out and it’s not a current worry for you right now, that’s super important.

Misty January 22, 2015 - 9:06 am

I love reading about your house journey! I was on my way but due to some new planned changes in my life, my home buying dreams are being put on hold. But that’s okay. I feel really good about the path I’m taking and, since I’ll be moving to a more affordable area, I’ll be able to rent a really nice house for less than a mortgage payment where I am now would be and still save a significant amount for buying in the future. If I’ve learned one thing from getting my finances back on track it’s that you have to go with the flow, be content with what you have, and make smart decision for where you are in your life currently. I’m so glad you and Eric were able to do that!

Emily @ Urban Departures January 22, 2015 - 6:33 am

Ah the dream! Congratulations on being home owners and even more so for how far you’ve come in just five years time- that’s a testament of hard work.

I’m an apartment, small-space dweller and I love it, though my family will outgrow our current living conditions in a few years. My husband and I are still debating what to do when we run out of space; houses in a decent neighbourhood in Toronto start at the $600-700K price point which we could afford comfortably with the equity we’ve built on our condo, but we don’t want the majority our assets tied up in a home. *sigh* I’ll just have to live vicariously through you 🙂 I’d love to see what you do with your place!

newlywedsonabudget January 22, 2015 - 7:58 am

I LOVE hearing about others’ preferences. I think that is a very smart way of looking at things!

Reply January 21, 2015 - 3:59 pm

Sounds like you guys are living the dream! Congratulations!

Reply January 21, 2015 - 12:40 pm

Yay!! I am so happy for you guys and I seriously want to come out JUST to see you guys and the house!! must happen 😉

Mark@BareBudgetGuy January 21, 2015 - 10:26 am

I loved how when I lived in southern california people would try to help us find a house or a condo. They’d say “oh you should check out this neighborhood. You can get a condo for only $400-$500K.” ONLY! Perspectives are so different out there. Congrats on the house!

cece January 21, 2015 - 8:22 am

So excited that you two are literally-living the dream!! Coming from another very expensive housing market I agree that it truly is a dream come true to be able to own. With ridiculous housing prices it is impossible for many people. I totally get the buying a house not an investment thing. I wanted a home for the space and the permanence that it could provide. Apartment dwelling is exhausting after a while. Glad you made it work-even if you missed out on those cheaper housing prices.

OFG January 21, 2015 - 5:54 am

Can you write more about your retirement plan? Do you work for the government or for a private company? I ask because pension plans are often disbanded. My company froze and then cashed out our plan so employees who thought they would see 70% of their salaries never will. I worked for an extremely stable company so this really blindsided a lot of people.

Newlyweds on a Budget January 21, 2015 - 9:47 am

We both have pension plans through the state. If we had them through a private company, I wouldn’t trust that our pension plans would be secure–too many horror stories!


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