Should Medical Residents Buy a House?

If you're a resident doctor making $65,000 a year while sitting on $250,000 in student loans, buying a house probably feels like the next logical step. You're building your career, you want stability, and homeownership seems like a smart wealth-building move. Right?

Here's what I tell residents when they ask me this question: it depends, and realistically, most should wait.

Let me explain why.

The Numbers Don't Lie for Most Residents

The average medical resident carries $200,000 to $300,000 in student loan debt, according to the Association of American Medical Colleges. When you're making $65,000 as a resident and carrying that kind of debt load, your debt-to-income ratio is already stretched thin.

Now add a mortgage on top of that.

A $400,000 home with 20% down means an $80,000 down payment. Where's that coming from when you're living on a resident salary? If you're putting less than 20% down, you're looking at PMI on top of your mortgage payment, property taxes, homeowners insurance, and maintenance costs.

Suddenly that "investment" is eating 40-50% of your take-home pay.

Why Residents Think They Should Buy

I get it. I understand why this feels urgent. You're tired of renting. You want to put down roots in the city where you're training. You've heard that renting is "throwing money away" and building equity sounds smart.

And here's the thing: that advice isn't wrong for everyone. For someone making $150,000 with no debt, buying makes total sense. But you're not in that position yet. You're in residency. Your income is about to change dramatically in a few years, and your location might change too.

When Buying During Residency Actually Makes Sense

There are scenarios where it works. I've seen residents make it happen successfully. Here's what needs to be true:

You have family money for a 20%+ down payment without touching retirement accounts
You're certain you'll stay in this city for fellowship and as an attending
Your total housing payment (mortgage, taxes, insurance) stays under 28% of gross income
You still have room to max out your retirement accounts
You have a 6-month emergency fund separate from the down payment

If all of those are true, go for it. But realistically, how many residents check all those boxes?

The Opportunity Cost Nobody Talks About

Here's what gets me. When you tie up $80,000 in a down payment during residency, that's $80,000 not working for you elsewhere.

Imagine instead you rented for those three years of residency. You lived somewhere reasonable, maybe $1,500 a month. You took that would-be down payment and invested it. At 8% annual returns, that $80,000 becomes roughly $100,000 by the time you're an attending.

Now you're making $300,000+, your debt-to-income ratio is completely different, and you can buy the house you actually want instead of settling for what you can barely afford as a resident.

Plus, you've been maxing out your 401(k) and HSA during those years instead of being house-poor.

The Mobility Problem

Residency isn't the end of the journey. You've got fellowship to consider. You might want to move closer to family. You might get your dream job offer in a different state.

When you own a house, you're anchored. Selling a house takes time and costs money, usually 6-10% in real estate fees and closing costs. If you need to move quickly for a fellowship opportunity, that house becomes a burden instead of an asset.

I've had clients who bought during residency, then had to rent out the property when they moved for fellowship. Now they're accidental landlords dealing with tenant issues while trying to focus on their specialty training. That's not the life you signed up for.

What to Do Instead

So if buying isn't the move, what should you be doing with your money as a resident?

First, lock in your insurance. You may not be as healthy at the end of residency as you are now. The stress, the hours, it takes a toll. Get your disability insurance and term life insurance locked in early while you're still young and healthy.

Second, contribute to your retirement accounts. Even if it's just 10% to start. Your resident salary is the lowest you'll ever make. If you can't save now, when will you? And realistically, if you don't build the habit during residency, lifestyle creep will eat you alive as an attending.

Third, attack your student loans strategically. If you're going for PSLF, make sure you're on the right repayment plan. If you're not, consider refinancing once you're an attending. But don't pay extra during residency if PSLF is your goal, right? That's just leaving free money on the table.

Fourth, build your emergency fund. Six months of expenses in a high-yield savings account. This is your "don't panic" money when life happens.

The Attending Years Are Different

Look, I'm not saying you should never buy a house. I'm saying wait until you're an attending. Your financial picture changes completely once you're making $300,000, $400,000, or more depending on your specialty.

At that point, a mortgage payment is a much smaller percentage of your income. You can afford 20% down without breaking a sweat. You have the income stability to commit to a location.

And honestly, you'll probably want a nicer house than what you could afford as a resident. Why buy a starter home now when you can buy your actual home in a few years?

The Bottom Line

Should medical residents buy a house? For most, no.

The math doesn't work when you're carrying six figures in student debt on a resident salary. The opportunity cost is too high. The mobility constraints are real. And you're only a few years away from having a completely different financial picture.

Focus on the fundamentals during residency. Lock in insurance. Save for retirement. Build good money habits. Let your attending salary do the heavy lifting for homeownership.

It's actually pretty simple. It's about implementing and doing it. Have a plan, stick to it, and don't let the pressure to "act like an adult" push you into a decision that sets you back financially.

Your future attending self will thank you.

Frequently Asked Questions

How much should a resident doctor save for retirement? Aim for at least 10-15% of your income, even on a resident salary. If your program offers a 403(b) with employer match, contribute enough to get the full match. That's free money you can't afford to leave on the table.

Can doctors get special mortgage programs? Yes, there are physician mortgage loans that allow 0-5% down with no PMI. These can make sense for attendings, but be careful using them during residency. Just because you qualify doesn't mean the payment fits your budget.

What if I plan to stay in this city long-term? Even if you're certain about the location, the financial math still matters. Run the numbers on renting versus buying, including all costs. If buying still wins and you have the down payment without sacrificing retirement savings, it could work.

Should I use a physician mortgage loan during residency? Physician loans are designed for attendings with signed employment contracts. Using one during residency means higher interest rates and a payment that could strain your budget. Wait until you have your attending contract in hand.

What's the best first step for resident financial planning? Start with the basics: emergency fund, disability insurance, retirement account contributions. Once those are locked in, then think about bigger moves like homeownership. Get the foundation right first.

Related: First 90 Days After Selling Your Company — If you're a founder thinking about exit planning, the same principle applies: get your foundation right before making big moves.

Sources: Association of American Medical Colleges (AAMC) student debt data, FINRA guidelines on debt-to-income ratios