All very fair points. I think one thing that makes a huge difference is whether you rent or own. There's obviously so many nuances to this all. I realize that

All very fair points. I think one thing that makes a huge difference is whether you rent or own. There's obviously so many nuances to this all. I realize that we (or at least I am) also mixing up various things, even though I chose to quote a particular city's median income for the example. If you are renting and your rent goes up 10% that obviously has a large effect. If you have a house and rent goes up 10% you don't care at all. If rent goes up like that, it's probable that house/condo sale prices go up too and you have to pay more in taxes. I bet the increase in taxes makes a smaller hole in your pocket, though I might be completely wrong. But this also depends on whether we stick with the example or move on to other countries, where there's no such thing as separate municipal/school taxes or where rent control is in place.