Poll

What Percent of your Gross Income do you Spend on Rent or Mortgage?

Less than 10%
106 (31.5%)
10-20%
158 (46.9%)
20-30%
58 (17.2%)
30-40%
12 (3.6%)
40-50%
1 (0.3%)
Above 50%
2 (0.6%)

Total Members Voted: 332

Author Topic: What Percent of your Income do you Spend on Rent or Mortgage?  (Read 22530 times)

stoaX

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #50 on: June 23, 2016, 04:34:30 PM »
15% or so of my total income goes to rent in high cost SoCal.  Always debating with myself whether to buy or rent, but in these parts the taxes and HOA fees on a house or condo would easily be $7k or higher per year.

jjcamembert

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #51 on: June 23, 2016, 04:39:37 PM »
Why is it gross income? Obviously that makes it a very different number, but you pay rent/mortgage after-tax, so I'd think that's what matters.

I tried to find the CNN survey but the article I found (not sure if it's the same) didn't specify gross or take-home.

onlykelsey

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #52 on: June 23, 2016, 04:41:16 PM »
Why is it gross income? Obviously that makes it a very different number, but you pay rent/mortgage after-tax, so I'd think that's what matters.

I tried to find the CNN survey but the article I found (not sure if it's the same) didn't specify gross or take-home.

It's certainly different for those of us in HCOL (generally high-tax areas).  I paid over 30% effective income tax last year.

Guava

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #53 on: June 23, 2016, 04:44:28 PM »
I was all excited to post my 20% (PITI+condo fee), but I have been humbled by so many people's badassity.

Great job, single-digiters!

This. I am at 13% of gross for PITI.

Lagom

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #54 on: June 23, 2016, 04:50:04 PM »
Just over 30% of our gross income. We live in the SF Bay Area and work in nonprofit type jobs, so our combined pay is nothing especially great for the area. Plus, we decided to rent a SFH for us and our two kids because we value the space, a walkable neighborhood, and having a yard to run around in. Despite all that, we manage to live almost entirely off my wife's salary and save over 80% of mine. Within the next few years I expect us to be able to save 100% of my salary. I enjoy being an example of why people who bitch about how expensive it is here are just whiny spendthrifts. :)

JLee

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #55 on: June 23, 2016, 05:09:11 PM »
If I ignore my rental property's mortgage and corresponding rental income, my own rent is 7.7% of my gross income (all utilities included).

iluvzbeach

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #56 on: June 23, 2016, 06:31:06 PM »
PITI = 5.4% of gross. Relatively HCOL, but fairly high income and very small mortgage.

kpd905

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #57 on: June 23, 2016, 06:42:05 PM »
We are sitting at 8% right now for rent, but looking to buy a house within a year.  Hopefully PITI will be around 12%.

Although it is pretty odd to figure this out using gross income.
« Last Edit: June 24, 2016, 06:42:55 AM by kpd905 »

Rewdoalb

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #58 on: June 23, 2016, 06:52:34 PM »
Income fluctuates with commissions, but on a below average month, PITI for a 3br in LCOL is 3.5% of gross. 30 year mortgage that we will pay down in 5-10.

tobitonic

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #59 on: June 23, 2016, 07:44:55 PM »
Zero; paid it off early with no regrets.

boarder42

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #60 on: June 23, 2016, 07:50:35 PM »
Zero; paid it off early with no regrets.

So you pay no insurance no taxes and do no maintenance. Where do you love I'd like to move to a place none of these were needed

Erma

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #61 on: June 23, 2016, 10:44:04 PM »
12.5% at the moment renting including parking, but not utilities.

socalteacher

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #62 on: June 24, 2016, 12:51:19 AM »
Just paying the 30 year mortgage, taxes, insurance and HOA we are right at 27%. We pay extra so it is more like 33%.

MrMathMustache

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #63 on: June 24, 2016, 03:59:40 AM »
Condo owner here.  Including HOA + taxes + insurance, just about 13.5% of gross income.

alsoknownasDean

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #64 on: June 24, 2016, 04:27:30 AM »
renting a one bedroom apartment, rent is 29.33% of net salary


Sent from my iPad using Tapatalk

BrickByBrick

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #65 on: June 24, 2016, 05:40:39 AM »
PITI = 10.2% of Gross Income

Alf91

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #66 on: June 24, 2016, 05:49:24 AM »
24%

ugh! I hate that it's so much. But it is one of the less expensive rentals in our neighborhood and I am quite fond of this area, kid's school, etc. Also I am able to walk to work from our current location which saves money on public transit (not to mention not needing a car). I have considered getting a roommate but don't think it would be worth it.

hoipolloi

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #67 on: June 24, 2016, 05:51:21 AM »
Just over 18%, HCOL. Includes all utilities at least. 

GuitarBrian

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #68 on: June 24, 2016, 06:03:15 AM »
Zero. No rent, mortgage, property taxes, or maintenance.

$40 a month in utilities, mostly propane.

(currently living in an RV)

ender

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #69 on: June 24, 2016, 06:29:29 AM »
Why is it gross income? Obviously that makes it a very different number, but you pay rent/mortgage after-tax, so I'd think that's what matters.

I tried to find the CNN survey but the article I found (not sure if it's the same) didn't specify gross or take-home.


The house we're buying has PITI of about 15% of my gross income.

I agree that gross vs after-tax seems a bit of a silly comparison.

rubybeth

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #70 on: June 24, 2016, 06:36:38 AM »
Have never calculated it based on gross income, but it's at about 9%, and we rent a small apartment in a relatively LCOL area. This really does afford us a lot of flexibility in our budget. If we buy a house, I am hoping we can stay at about 10-12% of gross. Ideally, we both want to max out retirement accounts at work ($18k each) and then still only be spending about 25% of take home on the housing/utilities stuff.

GuitarStv

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #71 on: June 24, 2016, 06:41:44 AM »
We're at about 12% until October . . . when this drops to zero.

jda1984

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #72 on: June 24, 2016, 08:10:35 AM »
7% of gross on P&I, we don't escrow on our place, so for PITI we're at 10.5%.

biglawinvestor

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #73 on: June 24, 2016, 08:13:34 AM »
10.1% on rent, which I think is way too high (NYC). If you look at our household income it jumps up to 12%.

boarder42

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #74 on: June 24, 2016, 08:16:53 AM »
We're at about 12% until October . . . when this drops to zero.

you dont pay property taxes or insurance in canada? i knew you guys were pretty socialist but thats nice of the govt to let the income earners pay for the homeowners houses even if they arent working. maybe i'll FIRE up there.

SamIAm38

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #75 on: June 24, 2016, 08:23:20 AM »
rent about $9600 for a 1 bedroom apt,
gross - 10%
23% of take home dollars


acroy

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #76 on: June 24, 2016, 08:43:09 AM »
6.1% mortgage only
10% including insurance, taxes
13% including utilities

v8rx7guy

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #77 on: June 24, 2016, 08:54:24 AM »
Zero; paid it off early with no regrets.

So you pay no insurance no taxes and do no maintenance. Where do you love I'd like to move to a place none of these were needed
We're at about 12% until October . . . when this drops to zero.

you dont pay property taxes or insurance in canada? i knew you guys were pretty socialist but thats nice of the govt to let the income earners pay for the homeowners houses even if they arent working. maybe i'll FIRE up there.

That's not what the poll asks, It asks what you spend on rent or mortgage...  Zero is a perfectly fine answer.

RonMcCord

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #78 on: June 24, 2016, 08:57:23 AM »
What's the secret, especially for those in a HCOL area?  I live in a LCOL area and I can't find anything that is less than half my gross and roommates aren't really a thing in this area (I really want to move to a HCOL area in the future though, mainly for more opportunities for shared housing and a better job market).

boarder42

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #79 on: June 24, 2016, 08:59:57 AM »
Zero; paid it off early with no regrets.

So you pay no insurance no taxes and do no maintenance. Where do you love I'd like to move to a place none of these were needed
We're at about 12% until October . . . when this drops to zero.

you dont pay property taxes or insurance in canada? i knew you guys were pretty socialist but thats nice of the govt to let the income earners pay for the homeowners houses even if they arent working. maybe i'll FIRE up there.

That's not what the poll asks, It asks what you spend on rent or mortgage...  Zero is a perfectly fine answer.

the purpose is to determine your cost of your lodging i would think thats pretty clear.  the OP just didnt clarify that.  you could also go the step further and calc your opportunity cost but i'm sure you're against that.

mtn

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #80 on: June 24, 2016, 09:01:44 AM »
What's the secret, especially for those in a HCOL area?  I live in a LCOL area and I can't find anything that is less than half my gross and roommates aren't really a thing in this area (I really want to move to a HCOL area in the future though, mainly for more opportunities for shared housing and a better job market).

Sounds like you're not really in a LCOL area when compared to incomes.

Slee_stack

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #81 on: June 24, 2016, 09:13:58 AM »
I'm also one of those OPP COST guys.

We pay about 15% PITI.  Is that good or bad?  Meh.

I suspect many on this forum that carry a mortgage could pay it off tomorrow if they wanted to.  We could (or are at least very close to) pay it all off with after tax money. 

But would that be smart for us?  Hell no.  We'd lose the tax incentive which helps knock us down a bracket and we may also lose the interest spread on our after tax investments (factoring in risk of course, but we are comfortable with risk).

So, the poll is curious I suppose, but essentially meaningless.

We could react in shock if someone posts >50%, but they also might be a young alternative investment fiend raking it in otherwise.  Likewise, the '0%ers' may or may not be the smartest though there is always  'bragging rights'.  The savvy renters may be snickering at them behind their backs though!

Spork

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #82 on: June 24, 2016, 09:19:40 AM »
Zero; paid it off early with no regrets.

So you pay no insurance no taxes and do no maintenance. Where do you love I'd like to move to a place none of these were needed
We're at about 12% until October . . . when this drops to zero.

you dont pay property taxes or insurance in canada? i knew you guys were pretty socialist but thats nice of the govt to let the income earners pay for the homeowners houses even if they arent working. maybe i'll FIRE up there.

That's not what the poll asks, It asks what you spend on rent or mortgage...  Zero is a perfectly fine answer.

the purpose is to determine your cost of your lodging i would think thats pretty clear.  the OP just didnt clarify that.  you could also go the step further and calc your opportunity cost but i'm sure you're against that.

My answer is zero as well...  and yes, there are opportunity costs and taxes and insurance and some year in the future there will be maintenance.  Opportunity costs are a little difficult (at least for me) to calculate, but I do understand there are trade offs.

Even if I add in taxes/insurance... My house is new enough that maintenance isn't a factor (yet). My answer is still in the "under 10%" on the poll.

TheInsuranceMan

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #83 on: June 24, 2016, 09:35:44 AM »
6.7% of gross take home pay, includes PITI

I lied, this is actually of net take home pay
We are sub 4% of gross pay.

spicykissa

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #84 on: June 24, 2016, 09:37:18 AM »
Our rent is 11.5% of our base gross income (not including my overtime and husband's bonuses). It's 20.5% of base net income. We just moved out of a truly awful but cheap place and our rent increased by 50%.

Gross vs. net does make a huge difference for us, what with high taxes, retirement savings, and ESPP. Our gross is a lot higher than what I budget with!

Bettis

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #85 on: June 24, 2016, 09:37:35 AM »
16% of gross for P&I
21% of gross for PITI

Laserjet3051

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #86 on: June 24, 2016, 09:56:04 AM »
SITK household in HCOL. Excluding utilities, our rent payments consumed 26% of gross income over the past 12 months. modest rent increase goes into effect next week, so this will climb a bit over the next year. Unfortunately, there aren't an abundance of private sector neurpharmacology jobs in LCOL areas in the USA.

tobitonic

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #87 on: June 24, 2016, 10:05:50 AM »
Zero; paid it off early with no regrets.

So you pay no insurance no taxes and do no maintenance. Where do you love I'd like to move to a place none of these were needed

You must have an interesting definition of "mortgage" that includes taxes and maintenance. Mine doesn't.

onlykelsey

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #88 on: June 24, 2016, 10:07:09 AM »
Zero; paid it off early with no regrets.

So you pay no insurance no taxes and do no maintenance. Where do you love I'd like to move to a place none of these were needed

You must have an interesting definition of "mortgage" that includes taxes and maintenance. Mine doesn't.

To be equal to rent, wouldn't it make sense to include those numbers in your mortgage?  REnt implicitly covers your share of those expenses.

tobitonic

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #89 on: June 24, 2016, 10:14:45 AM »
Zero; paid it off early with no regrets.

So you pay no insurance no taxes and do no maintenance. Where do you love I'd like to move to a place none of these were needed

You must have an interesting definition of "mortgage" that includes taxes and maintenance. Mine doesn't.

To be equal to rent, wouldn't it make sense to include those numbers in your mortgage?  REnt implicitly covers your share of those expenses.

Not to me, because that varies from one situation to the next. Some rent agreements cover pretty much everything that can go wrong with a property, maintenance-wise, while others will cover next to nothing. Besides that, the decision of whether to rent or own is up to the individual, as is the decision to live in a HCOL area vs a LCOL one, or a larger property vs a smaller one, or a rented property with many / all utilities vs one with few / none included.

Too many assumptions to take into account once we start going above and beyond the OP's question. I'd rather just answer what the OP directly asked, which was the percentage of income spent on rent or a mortgage. S/he even clarified further that s/he was only referring to monthly required payments by asking people specifically not to make calculations based on pre-payments.

And to answer the rest of the OP's question, before paying it off, it varied, because we started making more income over time. By the time we paid it off, our annual income was more than the cost of our home, so I voted under 10%.
« Last Edit: June 24, 2016, 10:19:30 AM by tobitonic »

rockstache

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #90 on: June 24, 2016, 10:27:19 AM »
We rent for < 6% of gross, includes water but not other utilities.

slugline

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #91 on: June 24, 2016, 10:40:49 AM »
Depending on how you count it, we're at 14% (P+I) or 17% (P+I+T+I) for our mortgage/gross income ratio.

Zero. No rent, mortgage, property taxes, or maintenance.

$40 a month in utilities, mostly propane.

(currently living in an RV)

Are you simply shuffling around between public parking spots? Maybe you can at least count the engine fuel? :)

21runner

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #92 on: June 24, 2016, 10:58:46 AM »
I'm at 22.8% of my gross pay.

Slee_stack

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #93 on: June 24, 2016, 10:59:24 AM »
Depending on how you count it, we're at 14% (P+I) or 17% (P+I+T+I) for our mortgage/gross income ratio.

Zero. No rent, mortgage, property taxes, or maintenance.

$40 a month in utilities, mostly propane.

(currently living in an RV)
Hopefully its also a non-motorized RV that's well used.  Then depreciation and insurance is hopefully minimal as well.  People do sure love to pretend things are free don't they?
Are you simply shuffling around between public parking spots? Maybe you can at least count the engine fuel? :)

jamesbond007

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #94 on: June 24, 2016, 11:02:15 AM »
17% goes to PITI+HOA

Drifterrider

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #95 on: June 24, 2016, 11:17:32 AM »
12% and my mortgage is my only debt.

naners

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #96 on: June 24, 2016, 11:22:25 AM »
Just about 17% for a condo (co-op actually) in HCOLA, which includes taxes, common charges and some utilities (heat/HW). Seems to be toward the higher end of average here, but I'm pleasantly surprised since I feel like housing prices are insane here in Brooklyn. Looks like the average American spends about 27% of gross including utilities:

http://www.fool.com/retirement/general/2015/11/07/heres-what-the-average-americans-budget-looks-like.aspx

dalexa1010

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #97 on: June 24, 2016, 12:36:07 PM »
11.8% but I was able to get my second mortgage paid off thanks to HARP #1.  Did not even ask for it either.  I was on time and I got a notice that we did not have to pay that anymore.  Like Forrest Gump said "Good, that's one less thing"!

Inaya

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #98 on: June 24, 2016, 12:41:22 PM »
Figured I'd add % of net, since somebody brought it up: 34.3% (vs. 15.5% of gross).

tobitonic

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Re: What Percent of your Income do you Spend on Rent or Mortgage?
« Reply #99 on: June 24, 2016, 12:43:18 PM »
What's the secret, especially for those in a HCOL area?  I live in a LCOL area and I can't find anything that is less than half my gross and roommates aren't really a thing in this area (I really want to move to a HCOL area in the future though, mainly for more opportunities for shared housing and a better job market).

My rule of thumb for home-ownership (keeping in mind that I can't tell if you're looking to rent or to own) is to avoid buying in any area where homes cost more than 2x household income. It's pretty conservative (relative to US buying patterns), but it helps me keep from getting swayed by the alleged prestige of an area. This does mean avoiding HCOL areas unless roommates or renting out rooms would bring expenses within that 2x margin. Of course, buying in cash is another way to get out of the rat race.