THE GLOSSARY · HOUSING
Housing ratio
The share of your income that goes on housing. The figure lenders look at first, and the one that decides your room to manoeuvre.
By the Yoseri News desk · · 1 min read
Housing ratio — the share of your income spent on housing: rent, or the mortgage instalment plus taxes and insurance. On $1,250 of housing out of $4,400 of income, it comes to 28.4%.
This figure decides everything else, because housing is the one expense you can neither cut nor push to next month. The higher it climbs, the less the budget absorbs the unexpected.
It becomes decisive at a mortgage renewal. On a balance of $206,180, going from 4.64% to 5.64% adds $118 a month — and lifts the housing ratio from 28.4% to 31.1%. At 6.50% it reaches 33.5%, and what is left of the month melts from $640 to $415.
In Yoseri, the housing ratio is shown next to the savings rate on the Budget page, and the instalments that make it up on the Debt page.
Yoseri News is an educational publication. Nothing in this article is investment advice, a recommendation to buy or sell, or tax advice. Yoseri is registered as neither an adviser nor a dealer with any market authority.