Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Short answer: because a bureaucrat somewhere a long ways away in a time long ago decided so. Doesn't mean it's not still generally good advice, but it's nothing written in stone and less relevant than it once was. We pay a lot less for food and clothing than we used to. The big thing that costs more is healthcare, which most of us receive mostly paid for through employment. As long as you're getting your healthcare mostly paid for, you can spend a lot more than 30% on housing and still have plenty left over. It does cut into discretionary income, however.
Short answer: because a bureaucrat somewhere a long ways away in a time long ago decided so. Doesn't mean it's not still generally good advice, but it's nothing written in stone and less relevant than it once was. We pay a lot less for food and clothing than we used to. The big thing that costs more is healthcare, which most of us receive mostly paid for through employment. As long as you're getting your healthcare mostly paid for, you can spend a lot more than 30% on housing and still have plenty left over. It does cut into discretionary income, however.
And car expenses. VMT is still quite high and cars are bigger than they used to be ( a few decades ago).
And car expenses. VMT is still quite high and cars are bigger than they used to be ( a few decades ago).
But not really anymore expensive and more efficient. 1988 Accord in 2014 dollars would cost $20,700. A 2016 Accord costs $22,100. 1988 Accord got 26 mpg combined (24 for the automatic). The 2016 Accord gets 31 combined (automatic) or 27 combined for the manual. It's also more reliable, safer, and has many more luxury features. Air conditioning wasn't standard on the Accords in the '80s.
Cars are kind of difficult to factor in to the 30% "rule" for housing as it predates when automobiles were something most households had.
But not really anymore expensive and more efficient. 1988 Accord in 2014 dollars would cost $20,700. A 2016 Accord costs $22,100. 1988 Accord got 26 mpg combined (24 for the automatic). The 2016 Accord gets 31 combined (automatic) or 27 combined for the manual. It's also more reliable, safer, and has many more luxury features. Air conditioning wasn't standard on the Accords in the '80s.
Cars are kind of difficult to factor in to the 30% "rule" for housing as it predates when automobiles were something most households had.
Perhaps because people often make tradeoffs between housing and transportation costs - e.g. spending more on one in order to reduce costs on the other - one metric I've seen recently used by government planners and their ilk is that the sum of housing and transportation costs should not exceed 50% of one's income, without breaking out a recommended percentage specifically for transportation.
My readings suggest that for most Americans, total housing and transportation costs are optimized with a relatively short commute, i.e. increasing your commute generally does not reduce your housing cost enough to offset your increased transportation cost.
Recent trends of central city gentrification could be a clue that people are catching on to this and that suburbs have peaked.
Perhaps because people often make tradeoffs between housing and transportation costs - e.g. spending more on one in order to reduce costs on the other - one metric I've seen recently used by government planners and their ilk is that the sum of housing and transportation costs should not exceed 50% of one's income, without breaking out a recommended percentage specifically for transportation.
My readings suggest that for most Americans, total housing and transportation costs are optimized with a relatively short commute, i.e. increasing your commute generally does not reduce your housing cost enough to offset your increased transportation cost.
Recent trends of central city gentrification could be a clue that people are catching on to this and that suburbs have peaked.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
