What percentage of your after tax income is devoted to housing?


There is an age old adage that your monthly housing expense should never be above 30% of your after tax income that I think is completely irrelevant in today's rental and housing market.

I'm curious to see what the average renter's/home owner's monthly expense including everything (HOA, utilities, PITI, etc) relative to after tax income is on a monthly basis.

I am currently at 32% in a major SE metro.

Comments (111)

Jan 3, 2018 - 12:37pm


34% and I am incredibly jealous of you peeps in the Southeast that don't have to shell out 1,500 to get a decent place inside the city

Eh. If you're in Atlanta you're going to struggle to get less than that for a decent place.

Maybe Greenville, Charleston, or Charlotte you could pull it off.

Commercial Real Estate Developer
Jan 4, 2018 - 7:16pm

I'm at roughly 30%, not counting 401k contributions, healthcare, year end bonus etc. just the percentage of cold hard cash wired to my account every month. This includes utilities, internet, and streaming subscriptions.

20% gross including utilities, internet, streaming subscriptions

p.s. I have no roommates

Jan 3, 2018 - 12:42pm

Mine is around 17% gross and maybe 24%ish net salary. Bonus drives that down to 11%/16.5% respectively.

Living with a girlfriend is pretty cool. On my own you'd double all of those.

Commercial Real Estate Developer
Jan 3, 2018 - 2:12pm

I'm at about 55% net/33% gross, but have a mortgage/prop taxes, etc (living in an investment prop.), so I have been able to write off the interest (at least for now). If you factored in the write-offs for prop taxes/interest, it probably knocks me back down to between 35-40% net, but that's also not factoring in that I'm (theoretically) building equity unless the housing market blows up before I am able to sell.

EDIT: should mention that this is on monthly income only, does not include bonus.

"Who am I? I'm the guy that does his job. You must be the other guy."
Jan 4, 2018 - 9:04am

How's that working out for you? Did you have to downgrade on location/interiors/lifestyle to go this route?

I always think about it, but then I remember I'm an apartment/townhouse snob.

Commercial Real Estate Developer
Jan 4, 2018 - 12:12pm

the 30% rule is gross, not net (same math as the NYC rule that your salary should be 40x your monthly rent).

currently just under 11% gross. Live frugally with GF.

Jan 4, 2018 - 12:11pm

Chicago has really hurt people on housing costs lately.

I bought 5 years ago. My condo assessments up 50%. A good chunk of that due to minimum wage hike .

Property taxes up 50%. And no they can’t be deducted.

My best friend was also paying 3k a month rent.

In 5 years I’ve went from paying 5,500 a month on my mortgage (after value of tax deductions rent etc) where 2500 a month of that was mortgage principle to now I’m paying 11k a month with the same amount paid in principle. Though probably adding a roommate soon.

Had a lean bonus year too. NYC real estate likely to have some problems now too with end of salt deductions. But Chicago was hiking taxes etc too.

Jan 4, 2018 - 12:22pm

21-23% of gross*, depending on what you classify as housing costs vs. other expenses. House in the 'burbs in the southeast.

*Because we are wildly risk-averse, my wife and I treat my salary as our income (which functions as the denominator here). We bank her salary and bank my bonus. Including those would skew the figures lower and reveal the crazed depths of our fiscal conservatism.

Jan 4, 2018 - 12:25pm

I love having a working wife who doesn't care about having a big house.

I'm currently around 10% of gross in a major SE city

Jan 4, 2018 - 6:14pm

26.6% of gross for a 1 BR in NYC (great neighborhood, older building). I kind of have to chuckle at the people not in SF/NYC who complain about housing costs. I would give my left nut for housing as "expensive" as Chicago/Boston/Atlanta.

Jan 4, 2018 - 6:46pm

6.2% of gross for a 3-bed condo in the city. Love you, Chicago real estate prices.

when you're accustomed to privilege, equality feels like oppression
Jan 4, 2018 - 8:24pm

Really should be adding in the cost of having a car when comparing tier-2 cities to places like NYC as you probably will need a car to get around in the former and not in the latter.

For example, it you spend $1500/month on rent on a $100K salary, that's 18% gross spend on housing. But taking into account having a car at say~$500/month (payment, gas, insurance, etc), then that number becomes 24%, much closer to what people pay in places like New York.

To be fair, you should also add-in the cost of getting around in NYC too (taxis, subway, etc). But even then, I would say the difference isn't quite as pronounced as it originally may seem.

Jan 4, 2018 - 9:33pm

cars and living with ya women absolutely impact these metrics. Need to bake those in (garage, gas, insurance, sharing a bedroom) and then look at it, on a gross basis. If you want to live downtown, with walkability, alone, in a cool city, you will probably be spending 30%+ once adjusted for the factors mentioned.

"Money coming, money going, aint like you can take it with you" - Plato

Feb 25, 2018 - 5:59pm

Commissions and fees:

cars and living with ya women absolutely impact these metrics. Need to bake those in (garage, gas, insurance, sharing a bedroom) and then look at it, on a gross basis. If you want to live downtown, with walkability, alone, in a cool city, you will probably be spending 30%+ once adjusted for the factors mentioned.

"Money coming, money going, aint like you can take it with you" - Plato

-Michael Scott

Jan 4, 2018 - 9:35pm

This is also an easy question if you pull up Zillow and look at rents wherever you are interested in. Choose somewhere you can afford, but that has the amenities you want, while making tradeoffs. Roommates, next to transportation, commute, student debt considerations, etc, and do what suites you best.

Jan 9, 2018 - 2:05pm

I live in a major metro in the Midwest and I'm at about 32% if i exclude Grocery, Discretionary and Student Loans (this last one is about half my housing - worth every penny though). 52% for everything (including car payment and gasoline costs). I should also note that I don't dine out as much as I used to which has saved me a ton of money. I'm a good cook (used to be an assistant chef - not accredited or anything just got really good at it) and got back in the groove of really enjoying making my own meals (I hated commercial cooking and it took me years to shake off that damage).

"I'm talking about liquid. Rich enough to have your own jet. Rich enough not to waste time. Fifty, a hundred million dollars, buddy. A player. Or nothing. " -GG
Jan 10, 2018 - 4:39am

I live in London and I'm at about 38% of after tax. This has improved massively in the last year due to promotion etc. I have stayed in the same flat since my first year working where I was at about 50% but love the flat so much I chose to stay when my roommate moved out and and girlfriend moved in. I'm happy there so plan is to stay for the forseeable future and watch that percentage continue to drop as my salary increases.

Jan 14, 2018 - 2:47am

38% in North Dallas.

Note: I've spoken with many Class A++ Developers in the Texas market and they are rather bullish that the majority of their tenants (young professionals/millennials) will shell out up to 60% for the high-end luxury finish and amenity structure. 100+ million dollar asset manager confirmed that their best tenants are the recent graduates using their high-rise residency to network -- ie they will pay more than asking rent for the potential future benefits.

Jan 14, 2018 - 2:56pm

27%, soon to be 22%. High end hotel/residences with bars, restaurants, valet parking, batting cages, rooftop pool and bar, etc...

Jan 17, 2018 - 10:24am

16% net income not including bonus. Will most likely rent forever. Don't own much stuff, so will just keep moving if rent ever tops tops 20%

Jan 17, 2018 - 12:18pm

not saying people on this forum/thread are lying (I'm assuming most people here are financially literate/savvy) BUT...being a Sr. Mortgage Banker who is ranked as one of the top producers in my area, AND working directly under the Top mortgage banker in the state....I'd say everyone reporting their DTI ratios is doing an EXCELLENT job. Most people we see closing on home loans here in SE VA...back end ratios are well above 40%. In fact, the last 5 pre-approvals I've issued, have all been over 50% back-end ratios. Not saying I recommend this type of reckless spending, just reporting the facts. I myself-- my primary residence is only 1.27% of my Gross...if I include water, electric, internet, etc...maybe 1.5%...and I live "Down Town" (if you lived here you would see why I have quotes around it) In an upscale condo/loft. This is only including my salary+ commission from doing mortgages, not my investments, rental income, etc

Wise Men Listen & Laugh While Fools Talk
Jan 18, 2018 - 5:42pm

you couldn't be more correct. in fact...most people I say "you're pre-approved up to 250k" ....call me back later and say.... "hey I found a home at 260k, can we still make an offer?"
very rarely am I adjusting my pre approval letters downwards....which is saddening at times--- as I always tell my clients "I can **always **approve you for more than you can afford" .

Wise Men Listen & Laugh While Fools Talk
Jan 24, 2018 - 12:01pm

If I play my cards right, I'm about to go from 39% net/26% gross to 12% net/8% gross, and that will include parking. Northern Virginia

Quant (ˈkwänt) n: An expert, someone who knows more and more about less and less until they know everything about nothing.

Feb 15, 2018 - 3:24pm

Rent: 10.3% (excl. bonus)
Rent + Utils (electric, water, internet): 11.76% (excl bonus)

Rent: 14.35% (excl. bonus - factoring for 401k+insurance)
Rent + Utils (electric, water, internet): 16.35%

I either live in a low cost of living city, or I make a shitload of money. I'll let you guys figure that out.......... (it's the former)

Feb 27, 2018 - 11:13pm

Own a 1BR in Chicago. Above average but not luxury unit. 24% of combined monthly salary for fiance and me. That includes HOA + gross interest and taxes + insurance + cable/internet/utilities. Doesn't include principal payments. Bonuses would knock that number down but principal inclusion would cancel out a portion of it. Fiance = economies of scale.

Feb 26, 2018 - 1:06pm

I'm in London and it's c22% inclusive of all bills.
I share an apartment but have my own bathroom. I suppose I could get my own place, but right now I don't see the point as during the week I barely spend any time at home aside from dinner and sleeping and the apartment is nice enough to bring girls to.
Plus I'm on a very favourable contract that I'll surely step down on if I move. I'd rather just save for now.
When I first started working, the same place was c40-45% or so of my net income, but over time that has risen while as my rent really hasn't.

Nov 1, 2018 - 11:33am

Moved to Austin a year and a half ago from NYC. After concessions, we were initially paying $1,600 for a 900 SF one bedroom in one of the newest buildings downtown. Definitely beats the $3,000 we were writing on the UWS...

Have since bought a 3 BR 3 BA home just outside of downtown and are now paying 21% of our net monthly pay (inclusive of HOA and utilities), not including year end bonus. Have recently received a sizable promotion that skews that percentage somewhat, but definitely still favorable.

Nov 1, 2018 - 12:53pm
Start Discussion

Total Avg Compensation

September 2020 Investment Banking

  • Director/MD (17) $704
  • Vice President (45) $323
  • Associates (257) $228
  • 3rd+ Year Analyst (37) $203
  • 2nd Year Analyst (142) $153
  • Intern/Summer Associate (134) $141
  • 1st Year Analyst (566) $129
  • Intern/Summer Analyst (547) $82

Leaderboard See all

Jamoldo's picture
LonLonMilk's picture
Secyh62's picture
CompBanker's picture
Addinator's picture
Edifice's picture
redever's picture
frgna's picture
NuckFuts's picture
bolo up's picture
bolo up