dark-haired-hamlet:

dark-haired-hamlet:

is-the-post-reliable:

elierlick:

I think about this a lot.

requested by anonymous:

RATING: RELIABLE

Source: ‘The math checks out. In 2019, the median annual earning for women was $47,299. For men, it was $57,546. Averaged together, that’s about $52,423.The cost of the average home in the same time was $377,700. That is about 14 percent of the median salary.’

As of Oct 2022, the median annual earnings for women in the United States was $50,492 (extrapolated by multiplying weekly earnings by 52 weeks). For men, it was $60,528. Average together, that’s about $55.640. The average purchase price of a home in the United States during Q3 of 2022 was $542,900.

The average salary in the US is now about 10.2% of the cost of a home.

But that’s not even the whole story, because “income earned” means pre-tax income, and mortgage payments are not tax deductible unless you itemize (which people w/ average salaries do not do bc it’s usually less than the standard deduction).

In 1936, following FDR’s income tax hikes, the median annual salary for a single person was $830, taxed at 4% Income + 1% Social Security. The take-home median pay was therefore ~$790. The average home value was $4,766. So take-home pay was about 16.5% of home cost in 1936.

In Oct 2022, taxes are a bit more complicated. Assuming you take the standard deduction, file single, and only pay federal income tax, the take-home pay from a salary of $55,640 is about $51,584.

(Using H&R Block’s 2022 tax estimator)

So really, the average take-home pay is now 9.5% of the average home price.

Meanwhile, the person earning $2M/yr in 2022 would end up taking home at least $1,289,600. He is taxed at 35.3% of his earnings. The person earning the inflation-adjusted equivalent of in 1936 (~$95,000) would be taxed at 60% of his earnings.

Tl;dr: It’s an even more dire situation than that tweet suggests. Taxes on the middle class have skyrocketed, taxes on the ultra-rich have been slashed in half, and housing is nearly twice the ratio to income earned that it was in the middle of the Great Depression.