4 ms·
...to stick to the 1/3 rule. When did that become the rule? Why, back in my day, 25% was the max amount recommended to spend on housing. Though that was also b
by mikestew 11mo ago
...to stick to the 1/3 rule.
When did that become the rule? Why, back in my day, 25% was the max amount recommended to spend on housing. Though that was also back when no one would even think of taking out a 72 month car loan. Maybe one of those new 60 month loans, if you just don't have the money, otherwise stick to 36 months.
And like you, I just don't get it. 1/3 on the house, whatever percentage comes out for the $40K car @ 72 months (granted, one doesn't need to buy new), where's this money coming from? We live in Redmond (WA), and I'm at a loss as to how there are so many newer Teslas parked in >$1MM houses. C'mon, there's only so many of those $500K total comp jobs to go around.
- lisbbb 11mo agoNew car prices are now simply outrageous. Auto makers need to start ditching features and get their unit costs back down.
- omosubi 11mo agowhat features in entry level cars do you suggest they get rid of?
- ethbr1 11mo agoUltrasonics, eye monitors, electronic locks, self-contained infotainment systems (just a screen and the interfaces for a phone would be fine), lane keeping, auto-braking
- dzhiurgis 11mo agoAll of these are required by law
- RandomBacon 11mo agoSource? Considering that not all cars for sale have all of those features, I'm pretty confident in saying that you're wrong. Back-up cameras are required by law, so that requires a screen, but the law does not require that screen do double-duty as an infotainment screen.
- ethbr1 11mo agoPerhaps. But there was a time they weren't required by law, and people still managed to drive.
- AngryData 11mo agoOnly auto-braking among those has been made law, and it won't take effect for atleast 4 more years, provided it stands intact that long.
- joestrouth1 11mo agoBefore my time but HUD upped the rent cap on affordable/public housing to 30% of income in 1980. Even 1/3rd's a stretch for most folks in most places in the US. A 25% rule of thumb isn't much use if folks can't find housing that meets the bar.
- aidenn0 11mo agoMeanwhile in areas where housing is absurdly expensive, other things aren't as expensive, so 1/2 is totally doable. E.g. if a studio is $2000/mo you have $24k/year for all other expenses, which is probably fine?
- joestrouth1 11mo agoWhat places are those? When I think of cities with expensive housing (NYC, LA, SF, Boston, London, etc) they typically also have higher taxes, fuel prices, food, etc. Maybe you can swap a costly car for public transit?
- aidenn0 11mo agoI've never lived in those, but my sister lived in Boston and didn't own a car. Income tax is progressive, so a higher income tax is probably less relevant to you if you are housing-insecure. Sales tax is regressive, but is maybe 700bp higher in places with high sales tax, so much less than the 50% bump between 1/3 and 1/2 your income. As far as food goes, if you eat out, that's way more expensive, but groceries are a much smaller difference.
- deleted 11mo ago[deleted]
- jimnotgym 11mo ago> C'mon, there's only so many of those $500K total comp jobs to go around. That presupposes that people bought the houses with their income. Family wealth might be the missing piece of the jigsaw