I know there are a ton of other factors but play along.
What is your ratio of house value to gross income. Our house is about 2x what our annual income is.
Example: House is $400K, income is $200k; (400/200) = 2x
-
Currently, our house is worth about 1.33x our income. But when we bought it, it was about 2x.
-
Ours is about 1.5, although we'll hopefully be moving to a larger house this summer.
-
@T.H.O.U.: ours is 2.5
It is suppose to be low?
-
Ours is 2.3 times our income!
Edited to add: we live in medium cost of living (central Texas)
-
1.3
We live in a low cost of living area
-
@Mamaof2: I think higher just means you have more money tied in in your house. Not a bad thing, just curious. Other factors like debt, taxes, etc all play into what you can/should afford.
-
@yellowbird: I'm thinking this should somewhat take into account cost of living though right? Because if you live in a LCOL area, wouldn't your income AND house value be low but the ration be comparable to a HCOL area?
-
@T.H.O.U.: gotcha!
-
@Adira: Yea, when we bought our income was lower too, so it was like 2.375 and now with the house appreciation and income raises its like 2x
-
@T.H.O.U.: I think you are actually trying to ask debt to income ratio or housing ratio (your payment divided by your gross income). How much your house is worth vs. your income means very little in terms of how much money you have tied up. I could make no money, have a $600,000 house that is completely paid off, and it wouldn't give a very informative picture.
Either way, it's 3.5x.
-
4x when we bought. After renovation, probably 5x!
-
@LBee: No I know about debt to income ratio, but I was curious about this ratio.
That situation would obviously be extreme (600x) but it would bring up a lot about how you afford to pay off such a expensive house with such little income. I thought asking that type of question would be way too personal.
-
1.5 now, 2 when we bought the house.
ETA that's what we owe on it. Value to income is 2.5.
-
Our homes assessed value is roughly 2.6x our gross income. I wouldn't be surprised if a professional assessment was done that it's more than 3x since we did a ton of renovations.
-
Mine is currently 2.4x per the percentage asked for in the question. But I didn't buy it for that much and housing prices are soaring in my area. My mortgage payment is actually the only reasonable payment I currently have. When we move to the next house, it will be over 4x our current annual income!
-
@T.H.O.U.: I don't mind answering it... We afforded a house out of our price range b/c both of our parents were extremely generous to help us, and also we're paying interest free back to my parents (so they essentially bought the house).
And to add.. We did this with our parents' blessings b/c we just wanted to be in our forever home since we weren't waiting long to have kids after being married. So we all agreed it didn't make sense for us to get an 'affordable' place then having to move, etc.
-
Well, ours is worth 5x our yearly income but our mortgage is really low because we paid for half of it in our down payment. So it may sound like we're in too deep, but really we're not.
-
Our house value is currently about 3.5x our income. But property values continue to rise steadily in our area, so we are hoping to see that increase!
-
1.25x. The funny thing is we bought a house 3 times more expensive than my husband originally wanted to look at even! I guess he is cheap when it comes to homes. Had we bought in the price range he wanted it would only be 0.4x. Yikes! Glad I talked him up.
-
@T.H.O.U.: living in a LCOL area doesn't mean you have a lower income (or in comparison to those in HCOL areas). I have friends in LCOL cities in FL and IA making 6 figures, in line with what others make in HCOL cities. I have to agree with @LBee: in that i don't think it really tells you anything. With the Canadian housing market as crazy as it is, you may have purchased a house at 400k only to now have it valued at $1.5 million, even though a combined household income is 200k. I think it would be more reasonable to look at your remaining mortgage vs income.
-
2.7, based on my guess of valuation from neighborhood comps
-
3x conservatively valued. But our mortgage is less than that, which is most important!
I don't know that this ratio gives much insight though (?) For example, my MIL's ratio would be like 7.5x, but she paid for her home in cash so carries no mortgage. Then again, she's still out almost $1k a month in property taxes, which is as much as some people pay in mortgage + taxes combined each month.
-
What we mortgaged is about 2.5x our gross income currently.
-
Our house is valued 2.1x and our mortgage is 1.2x.
-
Almost 5.0 when we bought it, but our mortgage is far less than that.
-
5.5x. We bought it at 4x. Our house is highly valued with the market increase. We currently owe 3x and will be paid off in 11 years. We refi'd a couple times so we have been paying for almost 7 years.
-
Currently its 0.85X but we are going to move soon and it'll probably end up being closer to 2X.
-
Our home value is less than our gross income. So like 0.85-0.9x? We live in a LCOL area.
-
About 2x
-
Ours is 5x. But we put down a decent amount, so the payments really aren't that staggering (cheaper than a lot of rents actually). And we barely have any other debt so it's affordable.
-
4.5x. we live in a high cost of living area and while our salaries are high, it never seems like enough. We obviously don't owe that much but the housing market is pretty crazy in our area. we moved a year ago and our house has already gained $60k+ in value since.
-
House debt to income is probably about 1.5. Value to income is probably 2.
-
Our home is valued 1.49x higher than our income.
-
2.4x. It gives me anxiety! Want to be debt-free so so bad, and I worry what would happen if I lost my job. Guess I should get back to work then
-
Check my math logic, someone explain this to me. IF most people owe 2x their income (or less) and are paying 25% of their income to housing- could they theoretically be paid off in 8 years?
-
1.24- We bought a starter house low in our budget because we knew we would be paying double daycare for a while. Daycare is WAY more than our mortgage. We will definitely upgrade when the kiddos start school .
-
@T.H.O.U.: oh I see what you mean. My income would be the same no matter where I am really so that doesn't apply to me.
-
About 2x our annual income.
-
About .61 x, we only bought this house to live in for a few years and wanted less space, but now we love it so maybe we'll stick with less then we could afford?
Subscribe to our newsletter
- Google Plus
- Stumbleupon
- Twitter
- Facebook
- Pinterest
- Favorite0
105 comments