>I think the problem with looking at percentages is that it doesn't
>scale. What someone with a $50k income can afford is not half what
>someone with a $100k income can afford: if you make more, you're
>often more willing to devote a larger percentage of your budget to
>housing, since getting twice as much house doesn't (typically) mean
>you pay twice as much for gas.
>
>I think it's a lot more useful to try to figure actual [net-of-tax]
>monthly costs when comparing own/rent scenarios.
According to the Consumer Expenditure Survey <http://www.bls.gov/news.release/cesan.toc.htm>, housing's share of income falls with income. Here's the share of after-tax income spent on housing in 2003 by income quintile (Q1 = poorest):
all 28% Q1 83% Q2 45% Q3 32% Q4 26% Q5 21%
Spending 40-50% of your income on housing is a sign of economic stress, except for people with a housing fetish.
(The Q1 figure of 83% is a little incredible; the CES's income measures aren't perfect, and poor people underreport their incomes - as do rich people.)
Doug