Quote:
Originally Posted by freeAgent 
My mortgage is my only debt, so I can swing it but it has forced me to stop contributing to my 401(k) and other retirement plans until I bring in more. The recession provided me with a deal that was hard to turn down. I bought in a nice, new construction building that had the worst possible timing...move-ins started in January 2009. Around June 2009, the developer slashed the prices, so what started out as a nearly $400k 1br+den (including parking) unit turned into a nearly $300k unit. On top of that, they had put together a deal with a mortgage company to buy down the rates on 30-year fixed mortgages. I put 20% down, got my $8k check from the gov't, and got a 30-year fixed rate mortgage at 3.875%.
So while it is sucking up a pretty large portion of my income, it's worth it to me. My unit is nice, the building is nice (and full of amenities), and I can walk to and from work. That's worth a lot to me. I don't plan on moving anywhere in the foreseeable future, and I expect that we'll probably start seeing some inflation in the years to come, making my 3.875% loan a very good investment
So while it is sucking up a pretty large portion of my income, it's worth it to me. My unit is nice, the building is nice (and full of amenities), and I can walk to and from work. That's worth a lot to me. I don't plan on moving anywhere in the foreseeable future, and I expect that we'll probably start seeing some inflation in the years to come, making my 3.875% loan a very good investment
Well a mortgage is a different animal altogether from rent. If 30% of my income went towards a mortgage, that would be much more acceptable. When we're talking about rent:income ratio, though, I think that 30% - 40% is a little outrageous, considering there are always other things to pay for, i.e. utilities, transportation, food, insurance, etc. Plus, I figure the vast majority of people that are currently renting aspire to own a home one day, so you also have to figure that some portion of that income probably gets squirreled away for a down payment.
