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Comment by mikestew | Hacker News Reader

...to stick to the 1/3 rule.

When did that become the rule? Why, back in my day, 25% was the max amount recommended to spend on housing. Though that was also back when no one would even think of taking out a 72 month car loan. Maybe one of those new 60 month loans, if you just don't have the money, otherwise stick to 36 months.

And like you, I just don't get it. 1/3 on the house, whatever percentage comes out for the $40K car @ 72 months (granted, one doesn't need to buy new), where's this money coming from? We live in Redmond (WA), and I'm at a loss as to how there are so many newer Teslas parked in >$1MM houses. C'mon, there's only so many of those $500K total comp jobs to go around.

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New car prices are now simply outrageous. Auto makers need to start ditching features and get their unit costs back down.

what features in entry level cars do you suggest they get rid of?

Ultrasonics, eye monitors, electronic locks, self-contained infotainment systems (just a screen and the interfaces for a phone would be fine), lane keeping, auto-braking

All of these are required by law

Only auto-braking among those has been made law, and it won't take effect for atleast 4 more years, provided it stands intact that long.

Source? Considering that not all cars for sale have all of those features, I'm pretty confident in saying that you're wrong.

Back-up cameras are required by law, so that requires a screen, but the law does not require that screen do double-duty as an infotainment screen.

Perhaps.

But there was a time they weren't required by law, and people still managed to drive.

Before my time but HUD upped the rent cap on affordable/public housing to 30% of income in 1980. Even 1/3rd's a stretch for most folks in most places in the US. A 25% rule of thumb isn't much use if folks can't find housing that meets the bar.

Meanwhile in areas where housing is absurdly expensive, other things aren't as expensive, so 1/2 is totally doable. E.g. if a studio is $2000/mo you have $24k/year for all other expenses, which is probably fine?

What places are those? When I think of cities with expensive housing (NYC, LA, SF, Boston, London, etc) they typically also have higher taxes, fuel prices, food, etc. Maybe you can swap a costly car for public transit?

I've never lived in those, but my sister lived in Boston and didn't own a car.

Income tax is progressive, so a higher income tax is probably less relevant to you if you are housing-insecure. Sales tax is regressive, but is maybe 700bp higher in places with high sales tax, so much less than the 50% bump between 1/3 and 1/2 your income. As far as food goes, if you eat out, that's way more expensive, but groceries are a much smaller difference.

> C'mon, there's only so many of those $500K total comp jobs to go around.

That presupposes that people bought the houses with their income. Family wealth might be the missing piece of the jigsaw

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