When are you considered House Poor??

[acesfull]

Hi All

 

At what point are you considered to be house poor?

 

When after paying your mortgage you have no money to eat, you have no money for clothes, no car.???

 

I estimate that 50% of my take home pay goes to my mortgage.

 

So am I considered house poor?

 

What % of your take home pay goes to your mortgage?? Do you consider yourself to be house poor???

 

Hope I am not being to newsy. I was just wondering.

 

Thanks,

 

acesfull

[acesfull]

Hi

 

I forgot utilities, lawn care, HOA dues, upkeep.

 

keeping up with the community/rich neibors, etc

 

I guess I am House Poor.

 

acesfull

[Peekaboo]

my MORTGAGE itself (including taxes and insurance) is under 10% of gross

 

Don't ask about the home improvement debt, though cause it pretty much more than doubles then LOL

 

I don't think it's ever worth it to try and keep up with anyone be it neighbor, family, friends, whomever. That's a vicious cycle because it's very hard to determine whether it is you keeping up with them or the other way around. It's usually one or the other at opposite intervals...

 

If you itemize your deductions, considering just the mortgage payment against your net income isn't really fair since you do get a benefit from that interest, taxes and insurance. Besides, think of it this way, you could be paying just as much in rent to pay someone else's mortgage, hoa, etc, right?

Edited February 4, 2007 by Peekaboo

[acesfull]

Hi Peek

That's great.

Sometimes I feel I am a slave to my home.

I love the place and all the community, the schools, etc

but sometimes I feel I work only to pay my mortgage company.

Oh well I guess I long for a simpler way of life. Living at home with mom and dad.

[Athena53]

In NJ, the mortgage and escrows for property taxes and insurance took up 50% of my take-home pay. I felt house-poor then. It didn't help that my son wasn't doing well in the public schools and I ended up forking over a lot of money to send him away to a military boarding school. There was enough money to pay the bills and take care of necessary maintentance (for which I was grateful) but making improvements to the house was out of the question.

 

We live in Kansas now and mortgage, insurance and taxes are about 20% of my take-home pay. What a difference. And we have a bigger house, too.

 

One factor is the absolute dollar amount of your income, too, I think. If you have 50% of your take-home pay left over after you pay for housing, you're a lot better off if your THP is $10,000 a month than if it's $2,000.

[acesfull]

In NJ, the mortgage and escrows for property taxes and insurance took up 50% of my take-home pay. I felt house-poor then. It didn't help that my son wasn't doing well in the public schools and I ended up forking over a lot of money to send him away to a military boarding school. There was enough money to pay the bills and take care of necessary maintentance (for which I was grateful) but making improvements to the house was out of the question.

 

We live in Kansas now and mortgage, insurance and taxes are about 20% of my take-home pay. What a difference. And we have a bigger house, too.

 

One factor is the absolute dollar amount of your income, too, I think. If you have 50% of your take-home pay left over after you pay for housing, you're a lot better off if your THP is $10,000 a month than if it's $2,000.

Hi

I live in NJ, AC area. The taxes are brutal, 6k a year.I am in the casino industry so no chance of moving anytime soon. My THP is good, not quite 10k but decent.If I were to purchase a bigger home in my area,

then I for sure would be house poor. New homes in my area are starting at $459k with only 2400SF of living space.Thanks and take care

acesfull

[54regcab]

I'd say if your mortage is over 3X your annual income, becoming a slave to the house can be a real possibility. we pay about 25% of our take home pay.

Edited February 4, 2007 by 54regcab

[texastech97]

I feel it's when you don't have a descent amount of money left to save after your expenses every month.

[2BlackCats]

Housepoor to me is not having any extra money when all monthly bills are paid for emergencies, savings, retirement and "fun".

 

Severe housepoor is if you can't even scrap up enough money to pay all your bills and/or food.

[hegemony]

I've always seen "house poor" refer to people have less house than they could "afford" not MORE house than they can afford.

Edited February 4, 2007 by hegemony

[Peekaboo]

I've always seen "house poor" refer to people have less house than they could "afford" not MORE house than they can afford.

That's interesting, I've always seen it in the context of paying so much for your house it makes you poor

[angeleyeskkhr]

I am house-poor. I own no home.

[hegemony]

I've always seen "house poor" refer to people have less house than they could "afford" not MORE house than they can afford.

That's interesting, I've always seen it in the context of paying so much for your house it makes you poor

well then people who rent can also be house poor.

 

maybe my point of reference is different but I recall reading some book that advocated being house poor; i.e., having a smaller, cheaper house than you can "afford" or at least not over-buying. in other words, if someone saw your house they'd think you were poorer than you are. the rationale was to invest money elsewhere and to maintain a good budget to avoid debt.

[eiui thelus]

Every article I can find on house poor, refers to having too much house (mortgage and maintenance) for your income.

[Peekaboo]

I've always seen "house poor" refer to people have less house than they could "afford" not MORE house than they can afford.

That's interesting, I've always seen it in the context of paying so much for your house it makes you poor

well then people who rent can also be house poor.

 

maybe my point of reference is different but I recall reading some book that advocated being house poor; i.e., having a smaller, cheaper house than you can "afford" or at least not over-buying. in other words, if someone saw your house they'd think you were poorer than you are. the rationale was to invest money elsewhere and to maintain a good budget to avoid debt.

Millionaire next door?

 

I purchased my house in that bracket, but I was able to. I think in most areas people don't have that luxury as RE is so expensive whether renting or buying. I at some of the prices I see mentioned people pay.

 

My DH is stationed in Hawaii. I would SO love to live there, but the bottom line is we can't afford it. I really don't know how those folks make it.

Edited February 4, 2007 by Peekaboo

[cljohnr]

If I were to purchase a bigger home in my area, then I for sure would be house poor. New homes in my area are starting at $459k with only 2400SF of living space.Thanks and take care

If you don't mind answering, how big is your family? The "only 2400SF" comment just made me wonder.

[varay0816]

I think house poor may be when you exceed that 35% DTI threshold banks use for mortgages.

[Skipper12]

I've always seen "house poor" refer to people have less house than they could "afford" not MORE house than they can afford.

That's interesting, I've always seen it in the context of paying so much for your house it makes you poor

well then people who rent can also be house poor.

 

maybe my point of reference is different but I recall reading some book that advocated being house poor; i.e., having a smaller, cheaper house than you can "afford" or at least not over-buying. in other words, if someone saw your house they'd think you were poorer than you are. the rationale was to invest money elsewhere and to maintain a good budget to avoid debt.

Millionaire next door?

 

I purchased my house in that bracket, but I was able to. I think in most areas people don't have that luxury as RE is so expensive whether renting or buying. I at some of the prices I see mentioned people pay.

 

My DH is stationed in Hawaii. I would SO love to live there, but the bottom line is we can't afford it. I really don't know how those folks make it.

Hi Heg!

 

Agree with ya on this.

 

Hi Peekaboo!

 

I always thought that being "house poor" meant buying much less of a house that you could "afford". We do that. While we could afford to live in a primo neighborhood, we like the one we settled into, and it is very nice. While we could "afford" a much larger home, we already have a 4/2/2. We spend < 10% DTI on our mortgage.

 

Of course, we own 2 rental homes and buy others to rehab.

 

Take care,

Skipper

Edited February 7, 2007 by Skipper12

[camclearbrook]

I've always seen "house poor" refer to people have less house than they could "afford" not MORE house than they can afford.

That's interesting, I've always seen it in the context of paying so much for your house it makes you poor

 

Speaking as someone who used to be all to familiar with being "house poor". Peekaboo is correct with the "definition"

 

House Poor

 

Definition: [crh] People who are short on cash because most of their money is tied up in their homes are "house poor."

[acesfull]

If I were to purchase a bigger home in my area, then I for sure would be house poor. New homes in my area are starting at $459k with only 2400SF of living space.Thanks and take care

If you don't mind answering, how big is your family? The "only 2400SF" comment just made me wonder.

we are a family of three. present home is 2100sf. The home is 11YO when it was new it costs 185k

now the homes in my area are all built between 2400sf and bigger with a starting price of 459k.

What I meant by only 2400sf is that the new built homes are bigger and more expensive.

acesfull

[acesfull]

I've always seen "house poor" refer to people have less house than they could "afford" not MORE house than they can afford.

That's interesting, I've always seen it in the context of paying so much for your house it makes you poor

 

Speaking as someone who used to be all to familiar with being "house poor". Peekaboo is correct with the "definition"

 

House Poor

 

Definition: [crh] People who are short on cash because most of their money is tied up in their homes are "house poor."

That's me. I'm house poor.

[radi8]

That's me. I'm house poor.

 

At $500/month for taxes, you aren't "House poor"- you are "tax poor".

That is more than my entire house payment- including taxes and insurance.

I don't know how people pay those kind of property taxes without either choking or wanting to strangle someone.

[acesfull]

That's me. I'm house poor.

 

At $500/month for taxes, you aren't "House poor"- you are "tax poor".

That is more than my entire house payment- including taxes and insurance.

I don't know how people pay those kind of property taxes without either choking or wanting to strangle someone.

NJ is so so brutal. The 6k a year that I pay is low compared to some.

My neibor has 4 bedroom, we have 3. They are paying $7800.00 per year. That's Jersey.

acesfull

[Meesh]

I am in the market for a house, and being house poor is my biggest fear. I think I probably actually will be for a while, anyway. My lender is working hard to make sure I don't qualify for more than I can actually afford. Even with a decent home, I'll be paying over 50% of my income on mortgage (PITI) but this doesn't include the power bill, internet bill, water and trash bill, etc. With all of that combined I'm worried I will be in "house poverty!"

[Riskyfool]

Interesting topic. I don't think I've ever heard the term "house poor" before, though I have heard "house rich - cash poor." Meaning you have plenty of equity but are otherwise struggling.