Help: What percentage of your income do you pay on rent/mortgage?

daniel-p

So I'm trying to find a place to rent on the other side of the country, sight unseen. I have a friend and real estate agent helping me, but it's pretty much a nightmare. They've done several walkthroughs and sent pictures of some places, but things are looking grim. It seems the only places that are decent are just out of my price range.

One townhouse is in an okay neighborhood, not as good a location as I would like, but has a yard, 2 beds 2.5 baths, built in '86. The other one is a condo right in town at a convenient location, brand new, granite counters, the whole deal, 2 beds, 2 baths, pool outside, etc. The townhouse would cost me appx 31% of my gross pay, while the condo would cost appx. 34%. I had hoped to keep it down to the same as I am paying now, which is about 25%.

What do you think?

Mad Dawg

The rule of thumb nowdays is that housing should not cost more than 30% of one's income. If your debt load is low, then going a little more is not a problem.

asilentone

zero I am the caretaker of this very large home.

TardNFeatheredJW

I pay about 15% of my gross including taxes and insurance. I am renting. The sad thing is, its a rent to own, but my ex did her best to destroy my credit, and the payments would actually decrease to about %11 of my gross if I were to actually get a mortgage. The principal is less than a years salary, the loan to value is about 50%, but since she destroyed my credit I can't even qualify for a mortgage on the place.

Very sad.

Anyway, my last house I had a little over 30% of gross for mortgage, taxes, insurance. It was okay and comfy. Banks currently don't seem to want to go higher than 28%, though. Consider that they keep these ratios to avoid writing bad debts. If you have an emergency situation with a 34% debt load for housing, you are more likely to not be able to afford the 34% than someone with 25%.

But, what the hell do I know, I can't even get a mortgage anymore.

jaguarbass

I paid my house off when I was 40 back in 92.

Thats the only way I can afford to be an ex JW with a watchtower education.

StAnn

Our goal is to pay off our home in 10 years, so we pay out 50% of our income on our mortgage (the regular payment plus extra on principal every month). We have almost no debt whatsoever and will be debt free, excluding the mortgage in 2 1/2 years, so we can afford to do this and still maintain a lifestyle we find comfortable. It really depends on what kind of lifestyle is acceptable to you. We live very frugally but that is our nature; I'm just not comfortable spending money unnecessarily. Our friends think we're odd but being debt free is more important to us than going out a lot. Only you can say how much you can afford for rent, based upon the lifestyle you wish to support.

StAnn

daniel-p

I understand people paying more of their income on a mortgage since it's an actual investment (most of the time), but if we pay too much on rent then we won't be able to save adequately to buy a house, anyway. I think I'll go for the 31%, although even that is a little high for my tastes.

techdotcom

about 22% of gross. If I ever get rid of the old house I'm renting then about 17%

cult classic

We pay about 25%. And I think that's high. I don't like paying out much on shelter. Although it's a necessity, I would pay as little as I could get away with for the nicest place I could find. Rent or mortgage payment. Life is meant to be lived. Not spent paying bills.

Cult Classic

Snotrag

The rule of thumb is 25% of gross income. That can be flexible. The max you can spend is 65% of gross income for all of your cost to live, that is note or rent, utilities, gas food, insurance,etc. Anything over 65% is taking away from your future.

Help: What percentage of your income do you pay on rent/mortgage?

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