Early 30's. Just purchased (not yet moved in). In Australia (stupidly high house prices).House is 57% of net worthHouse is 3.7 years income.I have an expensive house :(
On their own, I'm not sure what these ratios tell us. For example, when I bought my house, my HomeVal/Income was 1.7:1. My income has gone up, but not as fast as the value of my home, and I'd estimate that ratio is now 2.7:1
It's also probably obvious but the Home:NW and Home:Income ratios and time to FIRE are probably highly correlated (i.e. the lower the home value as % of net worth and income, the quicker one could retire)
Quote from: Undecided on July 31, 2014, 04:48:18 PMOn their own, I'm not sure what these ratios tell us. For example, when I bought my house, my HomeVal/Income was 1.7:1. My income has gone up, but not as fast as the value of my home, and I'd estimate that ratio is now 2.7:1where do you live such that home value gained 60% more than income? is that over a very long time period?
Age 54Home: net worth 1:3.6Home: income 14:1Because I am retired.Quote from: God or Mammon? on August 01, 2014, 04:14:59 AMQuote from: Undecided on July 31, 2014, 04:48:18 PMOn their own, I'm not sure what these ratios tell us. For example, when I bought my house, my HomeVal/Income was 1.7:1. My income has gone up, but not as fast as the value of my home, and I'd estimate that ratio is now 2.7:1where do you live such that home value gained 60% more than income? is that over a very long time period?London? Not very long?
Not sure I understand this.Everyone seems to be expressing diffrent things.Are we talking ratio of home equity:net worth or home value:net worth?What is the income ratio comparing?
No responses from the Bay Area? We don't own yet but most of our friends here have houses that are >6x annual income. Starter houses in our neighborhood start at 700K.
Quote from: madmax on August 01, 2014, 03:23:14 PMNo responses from the Bay Area? We don't own yet but most of our friends here have houses that are >6x annual income. Starter houses in our neighborhood start at 700K.We're in South Bay, Home:Net Worth ~1:1, Home:Income ~2:1 (assuming combined gross income).I didn't know the first was a ratio people tracked, what are the implications?