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My paid off home is 13% of my nest egg (defined as my investment portfolio plus house, not including SS, pension, other belongings, and so on).
But then, I live in the South where the cost of housing is moderate. If I lived in San Francisco, for example, I would probably spend at least 35%-40% of my nest egg on housing because the cost of housing is higher there. This is assuming that for some reason I didn't want to move, an unlikely assumption.
My home is important to me so if I had to spend more to live in a house I enjoy, I would do it.
... probably have less home and/or share it with another.
Well, maybe less home as far as square footage goes. I could be just as happy in a home 1/2 the size of my present home, if it made me happy in other ways. So, I could do that as long as the home was nice, although I would not share it with anyone. Mostly I'd cut back in other types of spending if need be.
If I was so pressed for money that I could not afford a nice home without a roommate, I'd not retire there at that time. I'd either work longer or live someplace else. (Since I have lived in SF before, and happen to prefer living nearly anyplace else, I'd probably go someplace else, barring the unforeseen.)
My point is that IMO, local cost of housing needs to be taken into account when trying to decide what is reasonable. I'd spend a larger percentage on housing in a location with higher housing prices, all else being equal.
I agree with Polyphasic9's view: rather than look at a percentage, look at how much money you need to generate the income you need to live on (which will be offset by SS income). When I look at my situation that way, I can afford more that I would normally be comfortable with on a percentage basis. Despite that, I still get uncomfortable when I look at the numbers for property taxes and maintenance ... and also the possibility that I may have bought when prices were abnormally high. I tend to be a bit on the conservative side, so all that would steer me away from being too grandiose.
I am heavy on property, buying my 2nd house this year with a 3rd being eyed in 5 years. I'd say it's 75-25.
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