The Cost Of Home Ownership Has Never Been This Bad, Especially If You Want To Live The Semi-Retired Life

What a difference nearly two years makes.

I was looking at something I wrote in December, 2021—

If I came up with the $100,000 down payment, I’d be looking at something like a $900,000 mortgage with a monthly payment of about $4,000.

I was talking about purchasing a $1 million home in Los Angeles. Taking the optimistic route, I assumed a 10% down payment. I didn’t include property tax and insurance and was working with a 3.25% interest rate.

Something like $4,000 was actually $3,917 at the time. Factor in property tax and insurance and the real monthly payment—not counting maintenance and such—would have been $5,664. In December, 2021.

Using the spend no more than 30% of your income on housing standard, you’d have to make $18,880 a month, or $225,600 a year, to afford that level of housing expense.

As I’ll discuss in this post—and touched on the other day—if me and my partner succeed in buying an apartment in Spain, we hope and intend to keep our threshold meaningfully under 30%:

To that last point, I just ran the numbers on a Spanish mortgage calculator. The one I showed you not long ago. Based on me and my partner’s anticipated income when we hit land for good in Spain, we can—technically—afford a lot more house than we’re hoping and planning to buy. If our income increases by then—as I think and hope (knock on wood) it will—we could—technically—afford even more house.

Anyhow, fast forward to August, 2023 in America, and the updated housing numbers are truly the stuff of blown minds.