Jeff Smith 10:30 a.m., Feb. 21
You're still paying fat percentage of income for your home
Consolation: it's a bit lower than in the pre-bubble years
Because of the startlingly low interest rates (3% to 4% mortgages), Americans are devoting a lower percentage of their monthly income to servicing their mortgages than they were in the pre-bubble years, according to information released by Zillow.com this morning (April 10). Nationally, families spent 12.6% of their income on their mortgage in the fourth quarter of last year, versus 19.9% in the pre-bubble years of 1985-1999. But in coastal California metro areas, homeowners are still shelling out fat portions of their income to service their mortgages. San Diegans, for example, were paying 25% of income in last year's fourth quarter to pay for their mortgages. Sure, that was down from 31.3% in the 1985-1999 years, but that's small consolation. In the fourth quarter, residents of San Jose were shoveling out 29.5% of income to take care of their mortgages. In San Francisco it was 28.8% and Los Angeles 29%. Those were the three highest percentages among the major 30 metro areas. Residents of Dallas, Atlanta, Detroit, Pittsburgh, Cincinnati, Cleveland, and Columbus, Ohio were all paying less than 10% of income to service mortgages in last year's fourth quarter.