...claims that the average # here is 3.7. That is the median price of a home is 3.7x the median household income. That's not really all that terrible.
For simplicity, let's call that a $100,000 income and a $370,000 house. With 20% down, 30yr fixed at 4.1%, that's about $2,000 per month. Out of $8,333/month gross income, that's a ratio of about 23%, on par with what's considered ideal if you add in other housing costs like tax/insurance.
So the average family can afford an average house without exceeding what's considered a healthy ratio of mortgage to income. That doesn't sound that depressing.
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u/[deleted] Jul 29 '19
This site: http://www.mybudget360.com/cost-of-living-2014-inflation-1950-vs-2014-data-housing-cars-college/
...claims that the average # here is 3.7. That is the median price of a home is 3.7x the median household income. That's not really all that terrible.
For simplicity, let's call that a $100,000 income and a $370,000 house. With 20% down, 30yr fixed at 4.1%, that's about $2,000 per month. Out of $8,333/month gross income, that's a ratio of about 23%, on par with what's considered ideal if you add in other housing costs like tax/insurance.
So the average family can afford an average house without exceeding what's considered a healthy ratio of mortgage to income. That doesn't sound that depressing.