It seems like everyone underestimates how much a sub-70k/yr salary in omg$$$California can do for you. I don't even make that much per year compared to my peers, and I've only been employed for 4 years now.
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I still owe approx 25k in student loans, which i'm paying off, and using the interest as deductible (I have no idea how this works. Every year, I'm given certain tax forms from the loan company I used; and input that stuff into my taxes, heh). As long as you keep your income-to-debt ratio at a certain ratio (55% is the cutoff i think?), you have a chance at owning a place. The monthly payments have been very reasonable. Hehe, it'll take me forever to pay it off, but oh well; cpa has told me paying the minimum amount in student loans is the best way for now (cut-off is 70k/yr income for this. I'm not at the cut off.. but will be in a few years).
-I bought a condo for about 60% of its ridiculously overpriced "value" when the real estate market was just too stupidly expensive. It'll never go up to that value ever again, but my place has been appraised for ~10k over what I purchased it for. The value of my neighborhood has been steadily going up in the months immediately following the purchase.
Like others have mentioned here, don't use the house as a short-term investment. Purchasing a place requires quite a bit of money up front. Even though I had around $35k in debt straight out of college, I didn't care too much about it (paid min) and started saving money from the first day I was employed; because I wanted my own damn place, damn it!
-I had no problems with paying off my car (2007 Mazda 3s, paid it off in 2 years.. no more car payments!).
-I try to be good with money. I don't have a 401k, and only invested very little in stocks (just a few grand to get the feel of it).
-I still have some cash left over to pay for my hobbies (paintballing, golf, snowboarding, reading, computer gaming, console gaming, and coming soon: motorcycling)
-My retirement comes from a separate plan with the University I work for, and I sometimes contribute to it when I have some left over cash.
-I pay off my CC's every month. NO EXCEPTIONS. I set a goal to never go over $1200/month on my CC...well, except when I bought my place, and renovated it. I incurred over $10k CC debt, but still paid it all off that month. Hehe, it was interesting to see four $25 amazon.com gift certs come in the mail all at once; followed by an automatic admission to Visa Signature club . woots (it'll help with my travels, since I travel A LOT due to the nature of my employment).
One most important thing I do, and quite possibly the simplest thing anyone can do to: I keep a log of my spending habits, prefaced with my goals. Having it written down is so much better than to keep a mental note of everything financial. I had no idea how quickly things just add up. Having my goals/priorities written down keeps me from doing spontaneous spending. If I do find something I like while I'm out and about, I just jot it down on my phone, and then see if it is practical enough to get it later after viewing my spending habits for that month. However, I'm still not immune to spontaneous shopping. I think that just happens to all of us, and I believe, our economy sorely depends on everyone doing just that.
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Oh, and I'm slowly learning to make my own food hahaha. You have no idea how much money you save just by not going out to eat.
All in all, I still think I suck with money, and could've done a lot better and lived more efficiently. Heh, I also think since my paycheck is a monthly paycheck, it helped me keep things in perspective. What I've just written down is just my own experience. If someone like me (who doesn't make that much, and has student loans to pay off) can own a condo in friggin Southern California, then you can. Just be reasonable in how you approach your income in relationship to your long-term goals.
Good luck OP.