% of income on mortgage payment and % of income on total housing costs?

[88CRX]

What % of net (take home) pay are you paying towards your monthly mortgage payment?

And

What % of net (take home) pay are you spending monthly on housing costs? Housing costs being mortgage + property tax + condo fee’s (if applicable) + utilities (not including cable/internet) + insurance.


Read lots of stuff online about total housing costs to not exceed 30% gross salary which seems absurdly high! Is 30% of net salary for all housing costs more reasonable/safe or is 30% of net still crazy?

Obviously the amounts of other debt one has will make a huge difference in these calculations but interesting topic to see roughly where people are actually at.

Edit: In before 10% net salary payments towards $1m house baller posts!

[vengie]

I was ~40% of net income on my condo living alone, however its now rented and it pretty much covers itself.

I now split a place with my GF so I am closer to ~20%. Although with her income she is closer to ~40% on our current place.

At 40% I felt pretty trapped, I don't think I would personally exceed 30% of net going forward.

[infected]

I'm 24% mortgage and 48% housing. After savings and all, pretty trapped too :cry:

[KappaSigma]

0% house is paid off.

[Masked Bandit]

For a long time the total housing costs would have been about 25% of net household income.

FWIW, I would re-define total housing costs as mortgage, property tax, all utilities including cable & internet plus monthly savings to build a cash reserve of about $10K for large repairs like a new furnace, HWT, condo cash call, etc. That should probably be another $250 - $300 a month until the cash reserve is built up.

[s_havinga]

Hmm, never actually ran those numbers.

If I go straight off my Net pay, my total housing costs (mortgage, insurance, utilities and property tax) take up around 64% of my paycheque.

My wife does work part time so if I factor that in I am down to around 54%

Looks like we are around 40% of gross Salary and live pretty comfortable.

We own 100% of everything else we have so no car loans. LOC's or CC debt.

Seeing as I obviously have a higher ratio then the internet suggests, my question is, what do people spend their money on if they actually are under that 30% mark? We have decent savings, make monthly RRSP and RESP contributions, send our kids to private school and take a few vacations a year (mostly camping but the occasions all inclusive winter get away) and the cash flow works?

[jwslam]

Bachelor checking in here. I'm over 40% net for just mortgage :eek:

[88CRX]

Originally posted by s_havinga

Seeing as I obviously have a higher ratio then the internet suggests, my question is, what do people spend their money on if they actually are under that 30% mark? We have decent savings, make monthly RRSP and RESP contributions, send our kids to private school and take a few vacations a year (mostly camping but the occasions all inclusive winter get away) and the cash flow works?

The smarter ones probably have larger savings accounts/investments and meaningful/maxed out RRSP/TFSA contributions.

The not so smart ones have $500-$1000/month car payments I bet :rofl:

[vengie]

Originally posted by s_havinga
Hmm, never actually ran those numbers.

If I go straight off my Net pay, my total housing costs (mortgage, insurance, utilities and property tax) take up around 64% of my paycheque.

My wife does work part time so if I factor that in I am down to around 54%

Looks like we are around 40% of gross Salary and live pretty comfortable.

We own 100% of everything else we have so no car loans. LOC's or CC debt.

Seeing as I obviously have a higher ratio then the internet suggests, my question is, what do people spend their money on if they actually are under that 30% mark? We have decent savings, make monthly RRSP and RESP contributions, send our kids to private school and take a few vacations a year (mostly camping but the occasions all inclusive winter get away) and the cash flow works?

I think you're in a slightly different scenario than most considering you have everything else paid off.

I believe the internet's % is based off the assumption of an $XXX/ month car payment and minor other debts.

I just paid off my other debts so I will be in a similar position to you on our next house. Pumped up to start socking away some major cash!

[BavarianBeast]

What constitutes as pay?

About 30% of my income is from salary/full time work and 70% of it is from investments/dividends/small business/etc.

I only spend my salary on my mortgage/housing costs, and that ends up being around 25% of my pay cheque.

Everything else is dumped into travelling, future children's university fund, investments and bad habits..

[88CRX]

And I guess total debt vs net salary ratio would be more interesting to know. But I'm not sure if people would honestly share that information.

[never]

Looks like we are at 26% of net for mortgage...which is pretty good because our payments are higher than needed. With everything else factored in, it's around 34%.

And the nice thing is...no car payments, no loans, nothing on the HELOC, no balance carried on the CCs, and no kids.

[ExtraSlow]

Now that we are SI2K's it's around 30% for total housing costs, maybe a little more. When we were DI2K's it was under 15%.

Although I do run a very "cash conserving" mortgage of the longest amortization. Back when we were a two income family we also put some extra mortgage payments in to hit the principal. The flexibility to stop those and how quite low monthly payments now is quite welcome.

[XylathaneGTR]

'bout 27% for mortgage, and 40% on housing costs as described by OP.
Live alone, inner city condo. No other debt.

[Manhattan]

21% and 31% for condo living. Might upgrade to a house in which case that number will obviously go up. I'd say don't worry too much about cash flow as long as you are able to pay mortgage payments relatively comfortably. You spend a significant portion of your life in your home and its one of the few things in life where you get to enjoy and use it and it retains or appreciates in value. Just keep a rainy day fund just in case of some financial calamity.

[botox]

We are not big spenders, most shopping is done at Costco, this includes clothes LOL. Wife just came back from china and got all our blinds done, tons of savings there :)

Dual full time income, married with 2 kids
25% Mortgage
25% Housing

- Have a rental that's breaking even with mortgage payments.
- Max out RRSP contributions yearly thanks to work match program
- Max out RESP for kids
- No other debts or loans. Cars are paid off.

[mr2mike]

Single person.
22% for my total housing costs. Don't feel like figuring out just my mortgage stuff.
I have renters.

Edit: Single vs couple makes a massive difference in lowering your costs.

[riander5]

One and a half income w/ gf

Total housing costs 25%

[flipstah]

Single and ready to mingle

2/5 mortgage
Almost half on total housing.

Condo fees :cry:

[cycosis]

Gross salary, before taxes is 15.4% mortgage, 21.4% total housing. BUT, I dont actually take possession f the house until June :D

We own both our cars outright and no other debt

Thats just the forecast

[Xtrema]

30% Net isn't that crazy. Median household income is around $98K (before the crash). Should net around $80K (based on 2 incomes).

30% of 80 is $24K or $2k/month. That should service a $400K mortgage (or a pretty good detached home).

Calgary Median detach price is $503K. 20% down yields a $400K mortgage, all numbers make sense.

And if you try the TD Affordability calculator, they will even push you to $550K house with these numbers.

[hampstor]

Single income, 3 kids, wife, and father in law. I excluded bonuses/shares and stuck with straight salary...


What % of net (take home) pay are you paying towards your monthly mortgage payment? ~25%



What % of net (take home) pay are you spending monthly on housing costs? Housing costs being mortgage + property tax + condo fee’s (if applicable) + utilities (not including cable/internet) + insurance. ~35%

[mr2mike]

I'm more just disgruntled on utility costs continuously increasing at a substantial rate across the board. Insurance costs increasing and property taxes jumping up or so they say, for 2018.
Place that against my salary been cut and no raises for 3 years and lower rental income.
I should probably be closer to 17-20% total rather than upper 22%.

[nickyh]

I'm at 30.6% of net income on total housing, I use the Till Debt do Us part model which states 35% as the max, so just below that a little.
But, that doesn't take into account long term savings for maintenance which I really should look into (roof etc).

Just on the mortgage, 20.8% of net income.

[Disoblige]

I'm more concerned about how much goes towards your principal vs. interest when talking about the mortgage. It's crazy when you look at it. Annual lump sum payments FTW, or increase monthly amount.

[max_boost]

Originally posted by Disoblige
I'm more concerned about how much goes towards your principal vs. interest when talking about the mortgage. It's crazy when you look at it. Annual lump sum payments FTW, or increase monthly amount. ya the interest payments really add up but it is a loan after all.

Personally I wouldn't go over 30% of net income for mortgage payment but it also depends on your other expenses.

I feel relatively free without a mortgage payment right now but utilities+condo fees+property taxes still total $1k per month.

[sabad66]

25% of net for mortgage only
40% of net for all housing costs

[msommers]

When I was working previously, I was right at 20% (19.4% to be exact) for everything housing related vs. my net pay.

[Swank]

Originally posted by sabad66
25% of net for mortgage only
40% of net for all housing costs I'd say that's about the same for me.

[dirtsniffer]

16% of net for mortgage (both incomes), including condo fees, ptax nad utilites its 25%. If I include groceries and cable its 30%.

[timdog]

i'm paying 43% but on purpose- accelerated the shit out of the payments to pay it down faster. if i needed to back off, i could easily drop it down to 30% or less.

[killramos]

~30% not including the wife's income

[tonytiger55]

Single Peasant

20% goes on Mortgage. Accelerated. This on Gross.

But I don't calculate my budget like that. I focus on Net.
Bi Weekly paycheque. One covers Mortgage, condo fees, car insurance, cable, cell, electric. All related to the roof.

Second cheque covers, Gas, Food, RSP contribution, whatever is left goes into short term savings.
There is er.... not much left..


:cry:

Edit. Adjusted for Gross.

[03ozwhip]

SI1K 25% accelerated bi weekly on a 20 year mortgage, net. really not sure what my other housing costs are lol maybe around 35% with everything.

[Tik-Tok]

Dual income

31% for mortgage alone
45% for housing (averaged out, Gas/Elec obviously vary by month)

[Kloubek]

Right now is a bad time to ask that because we are in transition between our new build and selling our old house.

Once all is said and done, I personally will be sitting at around 15% net income for my half of the mortgage, and about 20% for my half of mortgage+expenses once all taxes and utilities are factored in. Once I get my raise in a month, it's probably closer to 12%/16%.

But a lot of this depends on how quickly one is trying to pay their mortgage off. It is entirely possible we will be doubling up payments, in which case that 15/20% can increase significantly. Edit: I see others had the same idea.

Personally, I don't mind the 20% figure as it will sit. Our vehicles are paid outright and in fact we have zero debt otherwise, so paying that 20% is relatively easy.

[RX_EVOLV]

Right now 27% to the mortgage on my own net income, excluding my soon to be wife's income.

Once we combine into dual income, we are going to do some major reno at the house to get it ready for family expansion, but will try to keep the new mortgage total to <30% of net total income.

[Buster]

Leverage is flexible and can be a sliding scale depending on if you have a good use for capital outside of home equity.

A more useful ratio is home value vs. income.

[flipstah]

My income lowered at a greater rate than my expenses, so that's why the high variance.

30% of income dedicated on mortgage alone is high IMO.



Originally posted by Buster
Leverage is flexible and can be a sliding scale depending on if you have a good use for capital outside of home equity.

A more useful ratio is home value vs. income.

Yeah, home value should be 2x your income for a 'safe' bet. Any higher and you're not floating well.

[J-hop]

Originally posted by flipstah

Yeah, home value should be 2x your income for a 'safe' bet. Any higher and you're not floating well.

My metric is similar although slightly higher home value. My personal metric is mortgage should be no greater than ~2.5 your household income.

Anymore than that and you probably aren't going to save much.

[max_boost]

Originally posted by flipstah



Yeah, home value should be 2x your income for a 'safe' bet. Any higher and you're not floating well.

lol that's very conservative no? but agreed that's very safe.

make $100k, live in a $200k condo? or am I missing something?

[88CRX]

Originally posted by flipstah


Yeah, home value should be 2x your income for a 'safe' bet. Any higher and you're not floating well.

Except that doesn’t account for a larger down payment (say >20%).

And I don’t think 2x is remotely reasonable in Calgary. As posted above “Median household income is around $98K (before the crash)”. 2x that doesn’t even put you at $200k (which is a 1 bedroom condo in the burbs). I’d say 3-5x salary is more reasonable assuming you've saved up a decent down payment OR dont have other consumer debt.

[tirebob]

I would have to calculate all relevant costs exactly, but I am between 25% to 30% at most including Mortgage, taxes, and utilities plus average upkeep expenditures.

[FixedGear]

I'm at 24% of my net (after taxes plus 20% direct to investments) - so I'm actually less than 24%. I can only do it cause I'm single w no kids and try to live frugally.

Edit: after that, most of my net goes into savings and investments too, I'm able to save most of my earnings fortunately. :clap:

[colinderksen]

Mortgage+property tax+ house insurance+ utilities/net pay=28%
Plus 75,000/month investments+ 38,000/month high interest savings + max out resp+ max out rrsp+just in case 10,000 in case furnace, hot water tank, ac, panel all crap out+$300 in case water bed bursts

[flipstah]

2.5 to 3x if as others mentioned, no other consumer debt or large down.

Accomplishing either is uncommon; both are rare.

Life is sweet at 2x so time for me to hustle.

And anyone can afford anything at dual income. You'd be way over your head if you buy too high.

[timdog]

i know people that are Dual Income No Kids, with over $100k salary each, and they are in crippling debt and living paycheck to paycheck.
sort of a tangential point, but jesus christ how do you allow that to happen?? these people i know probably only spend 20% of their income on mortgage too. so it's more about how you spend in other areas. and how much you are saving to cover your ass in emergencies.

[blownz]

I have no mortgage so 0%, and prop taxes, ins, and utilities is probably around 5% of net or so.

I live in a very average house compared to our household income though which is why it is so low. 12 years in the same place! I don't have a single other friend that has stayed that long without upgrading. lol

[Twin_Cam_Turbo]

Single guy, townhome, originally put 20% down. 55.1% of net earnings going towards mortgage and 62.8% of net earnings towards total housing costs currently. I also put 19.6% of my net earnings into savings or RRSP.

[Kloubek]

Originally posted by Twin_Cam_Turbo
Single guy, townhome, originally put 20% down. 55.1% of net earnings going towards mortgage and 62.8% of net earnings towards total housing costs currently. I also put 19.6% of my net earnings into savings or RRSP.

Good lord man... how do you live? You gotta be an Ichiban kinda guy.

As far as Timdogs comments, that couple he mentioms has the opposite issue..... They have a spending problem and living far outside their means.

Personally I try to avoid any debt realistically possible. Had a car payment 20 years ago, then that was it. Can't stand paying avoidable interest.

[FixedGear]

^see that's the thing though, food costs more or less the same regardless of your income. That's why low income folks must spend a large proportion if their income in food, while high income folks can get by spending far less. If you $400k/year, you could live quite comfortably off 10-20% and save the rest.

[flipstah]

You can eat healthy for cheap. The key is not being picky, eating the same thing for a while, and cooking stews.

[Twin_Cam_Turbo]

Originally posted by Kloubek


Good lord man... how do you live? You gotta be an Ichiban kinda guy.

As far as Timdogs comments, that couple he mentioms has the opposite issue..... They have a spending problem and living far outside their means.

Personally I try to avoid any debt realistically possible. Had a car payment 20 years ago, then that was it. Can't stand paying avoidable interest.

I basically have no life outside my job and car stuff. I work 10-12 hours a day on average then I come home and go to bed. On the weekends I go to Ice Dice/Autoslalom/Car Shows or I tend to find a nice spot and sit in my car, listen to music and read.

[swak]

I'm just under 45% (mortgage, condo fees and all home expenses), bought a place with a close friend downtown edmonton.

I have student debt, car payment and other debt that messes with me aside from that a little bit. But i get by, and eat out and go out more than i know i should. :dunno:

[ercchry]

Imho I think it has to be a sliding scale, most day to day expenses are fixed for most people and even to an extent (assuming you're only getting a better location and finishes for your increased cost vs bigger home) supporting home expenses are fixed

So as far as a mortgage goes, if you make over a certain threshold you can afford to increase % of income

I'd put that number around $120k household income, well in this city

Also comes down to lifestyle, people all choose different ways to spend their time... is your vacation a one week 4 star Mexico all inclusive? Or a $10k+ euro adventure? Or just camping and hiking around town?

Do you eat out? Or prefer eating at home?

Or do you want to retire at 35? :rofl:

[muse017]

Total housing cost is about 17% of household income
40% down payment on townhouse and accelerated mortgage payment(Weekly + 10%)
Pretty comfortable living plus 2 vacations per year and such.

[ExtraSlow]

Relevant discussions of housing affordability in the news:
http://vancouversun.com/news/local-news/vancouver-housing-affordability-got-bad-fast-according-to-study

[Twin_Cam_Turbo]

Since last posting I’m closer to 70% net earnings combined. Hoping to pay the first mortgage off before I turn 31.

[C4S]

Say half ... and mortgage payment is always the same ...

But phone bill, internet bill, cable bill, shovel bill, heat, water, electricity, property tax and insurance, (house insurance has went up more than double lately with no reason!!) etc are killing!

[max_boost]

What's the % of income to spend on women. Or where do I find one I don't have to spend any money?!

[gpomp]

Currently at 60-70% on total housing costs. Thanks Nenshi!

[taemo]

From past calculations, about 23% of income goes to the mortgage.
Another 20% for utilities/home expenses

[msommers]

Currently 0% income, 50% rent, 25% on rental property to cover costs. Per month.

School seemed like a good idea when I started. At least I have job come May :rofl:

[ExtraSlow]

What's the % of income to spend on women. Or where do I find one I don't have to spend any money?!

Dude get a woman that makes more than you, and get married and loose your job. #winning

[msommers]

No.

Max needs to lose the idea that all he has to offer to a woman is his money. This attitude attracts woman that really only want money to feel loved.

There is so much more to you than your wallet my friend.

[RealJimmyJames]

Go Dutch on first date and all dates after that. Problem solved.

[max_boost]

No.

Max needs to lose the idea that all he has to offer to a woman is his money. This attitude attracts woman that really only want money to feel loved.

There is so much more to you than your wallet my friend.

Relationship expert right here :D

[nzwasp]

What % of net (take home) pay are you paying towards your monthly mortgage payment?

And

What % of net (take home) pay are you spending monthly on housing costs? Housing costs being mortgage + property tax + condo fee’s (if applicable) + utilities (not including cable/internet) + insurance.


Read lots of stuff online about total housing costs to not exceed 30% gross salary which seems absurdly high! Is 30% of net salary for all housing costs more reasonable/safe or is 30% of net still crazy?

Obviously the amounts of other debt one has will make a huge difference in these calculations but interesting topic to see roughly where people are actually at.

Edit: In before 10% net salary payments towards $1m house baller posts!

20% if you count both our incomes just for mortgage and 30% if you include all the other things you listed.

625k house cost in 2012

[Xtrema]

Say half ... and mortgage payment is always the same ...

But phone bill, internet bill, cable bill, shovel bill, heat, water, electricity, property tax and insurance, (house insurance has went up more than double lately with no reason!!) etc are killing!

House insurance probably have doubled since 2013 flood. Cars has been up 20% last year alone. This is for someone with 0 claims in 2 decades.

[Twin_Cam_Turbo]

House insurance probably have doubled since 2013 flood. Cars has been up 20% last year alone. This is for someone with 0 claims in 2 decades.

I noticed my car insurance went down but my house insurance went up so it was even this year.

[jwslam]

The numbers here are pretty telling as to who lives with a ladyfriend on dual income and who's livin the bachelor life LOL.

[Feruk]

Or where do I find one I don't have to spend any money?!
Prison

[Abeo]

13% and 20%. Living that ghetto neighborhood lyfe.

When I bought, I was very risk adverse (still am), so I made sure to have enough down payment that I could survive a large pay cut.

[s_havinga]

The numbers here are pretty telling as to who lives with a ladyfriend on dual income and who's livin the bachelor life LOL.

And who has a stay at home wife and kids...

[zaider]

When we bought our new place last year, we calculated it so that I was comfortable paying the mortgage myself. So with that in mind, mortgage is about 20% of net take home. Knock it down to 15% if you count what my wife contributes.

Additional costs you listed add about 10%, so 25-30% of net take-home pay depending if you count what my wife contributes.