Why do so many people hesitate with high incomes and buying houses?

My spouse and I make $130,000 annually and recently purchased a $750,000 home with a 30% down payment. Our monthly fixed payment is $4,550, including HOA fees, property taxes, and insurance. We have a newborn, and while we can’t splurge on travel or luxuries, we don’t feel financially stressed. I often see households with $300,000+ incomes worrying about buying homes worth $1 million. Where does all the money go? Why is it so stressful at those income levels?

Higher home prices often mean higher expectations. People with million-dollar homes might feel pressured to spend on expensive cars, luxury furnishings, and other high-end items.

Mai said:
Higher home prices often mean higher expectations. People with million-dollar homes might feel pressured to spend on expensive cars, luxury furnishings, and other high-end items.

In Southern California, a million-dollar home often means a modest house with a five-year-old Camry in the driveway. It’s not always about luxury.

@Journey
Why does it feel like you’re describing driving handbags in SoCal? :joy:

Mai said:
Higher home prices often mean higher expectations. People with million-dollar homes might feel pressured to spend on expensive cars, luxury furnishings, and other high-end items.

True, and the upkeep can be a lot too. Fancy homes require pricey maintenance and high-end furnishings to match.

Mai said:
Higher home prices often mean higher expectations. People with million-dollar homes might feel pressured to spend on expensive cars, luxury furnishings, and other high-end items.

Exactly. Add $300K in cars and $50K in jewelry, and it’s easy to see why some feel the pinch.

Our household income is about $400K. We have no debt and save heavily for retirement and our kids’ future. Our mortgage is $5,500/month, and it doesn’t feel stressful. A lot of the advice against such spending seems out of touch with current home prices.

@Wylie
True. $1,500/month for housing won’t even get you a decent apartment in most places today. It feels like advice from a bygone era.

Noor said:
@Wylie
True. $1,500/month for housing won’t even get you a decent apartment in most places today. It feels like advice from a bygone era.

Exactly. My parents paid $1,500/month for their house in the ’90s when homes were $200K.

@Wylie
It’s also a mindset shift. Housing costs have skyrocketed, and many haven’t adjusted their expectations. If you’re not over-leveraged, a higher payment can still be manageable.

@Wylie
Your financial situation is very different from OP’s, though. With nearly double their income and a similar house cost, the stress levels won’t compare.

Wait until that newborn starts daycare or gets sick often. Expenses really add up in those first few years.

Arlo said:
Wait until that newborn starts daycare or gets sick often. Expenses really add up in those first few years.

Exactly. Daycare can be thousands of dollars per month, and if you have more kids, it compounds quickly.

Arlo said:
Wait until that newborn starts daycare or gets sick often. Expenses really add up in those first few years.

But don’t some families manage with multiple kids and less income? It doesn’t always seem so impossible.

@Marin
Childcare costs are a killer. Many families rely on grandparents or other forms of unpaid help to make it work, but it’s not easy.

Oren said:
@Marin
Childcare costs are a killer. Many families rely on grandparents or other forms of unpaid help to make it work, but it’s not easy.

And just wait until they’re older and involved in activities like sports or extracurriculars. It doesn’t necessarily get cheaper!

@Marin
Some cultures rely heavily on multigenerational support. Grandparents or extended family often provide childcare, which makes a big difference.

@Marin
Even with discounts, daycare costs can hit $1,500–$2,000 per month per child. It adds up quickly.

At $130K income, half your take-home pay is going to your house. That doesn’t leave much for emergencies, savings, or other expenses. It’s great that you’re making it work, but it’s risky long-term.

A $750K house on $130K income is a bold choice. If one of you loses your job, that could lead to financial trouble.