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Our housing cost percentage to our income is about 8%. We have no mortgage or HOA. We are not very fuel efficient either. Our electric bill is higher than the average. I keep the house warm because all three of us are old. My wife and I care for her mom. She is relatively self reliant but at 84 she is plucky.
About 19% of net income. Some seasonal variation but generally that covers it. I have a water well so there is the eventual cost for a new pump or pressure tank.
I'd like to contribute since it is a sensible budgeting issue, but I don't really have any fixed income figure - I'm not collecting SS, I don't have a pension & the money I use to live on from my accounts has been increasing year by year as I switched from being overly cautious the first 2-3 years of retirement to now relaxing & enjoying my $$$ more now (not in a reckless way) while I'm younger & more active than I'll be in 10-15 years.
If I had to guess at what I think this year's income will probably be I'd say it is in the range of 20% give or take.
Same, except a 30 year. Percentage means little. If you have an income of $2000/mo, and expenses are only $1000, that’s still 50% and you only have $1k/mo left. If you have $4k/mo expenses, and $8k income the percentage is the same, but you are a lot more comfortable than with $4k left. And that is with no regard for portfolio or savings size. With a less than 4% mortgage I get paid every year to use Chase’s money, even though I could easily pay it off anytime.
Mortgage, property taxes, insurance and electric come to 19.4% of my gross income. I'm rural so water comes from my own well and goes to a septic system. Garbage is haul your own to the small dumpsters around the county, big stuff to the transfer station.
I always add something extra toward the principal on the mortgage so if that were included the percentage would be a little higher. Although I have been in the house for just over 13 years I'm past the 20 year point on the 30 year mortgage.
My housing and homeowner's insurance is about 26% of my monthly income. I don't pay taxes because my late husband was 100% military disabled. (Thank you to the Texas poster who reminded me about this benefit in 2018).
It is about 33% for us as we have a 15 year mortgage. I'm a proponent of using other people's money, if the price is right.
Quote:
Originally Posted by Perryinva
Same, except a 30 year. Percentage means little. With a less than 4% mortgage I get paid every year to use Chase’s money, even though I could easily pay it off anytime.
I did a quick spread sheet comparing our housing expenses in New York (no mortgage) vs. Idaho (15 years mortgage at 3.25%) and got 5.8% vs. 24.9% of our income then and now.
Since 56% of our mortgage payment is toward the principal, this brings the Idaho housing cost income percentage down to 11.5% which is roughly 2x of our NY housing expense. The increase is well worth it for a much nicer riverfront home (3x higher value) with fantastic views, better weather and living close to our daughter.
It is even more interesting when considering the fact that we left a stagnant real estate market in NY for one of a fast growing areas in Idaho (appreciation rates 10-15% in the last several years). We may have to down size and sell this 4,800 sq. ft, 2.2A home 10-15 years down the road. Using a modest 'average' RE appreciation rate of 5%, the 'net' Idaho housing cost comes down to -5%.
I agree with Perryinva that percentage means little when considering what is left after housing expenses. When it comes to housing, there are other factors to take into consideration like your enjoyment and the 'investment' aspect of a house.
As soon as we are completed building,and sell the house we currently reside, it will be 19%.
This includes property tax, landline, business phone, internet, trash service, prop tax & monthly subscription for an alarm system
(the alarm system, landline, business phone & internet is a bundle package from Sebastian)
.
Net income or gross??
I'm not yet retired, still have a mortgage, and for me:
% of gross is 16%.
% of net is 33%.
Last edited by ChessieMom; 05-25-2019 at 09:29 AM..
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