Are You House Poor? Here Are Four Ways To Tell

“House poor” describes a house so expensive that it requires a significant percentage of your cash flow every month. It's a position you want to avoid being in.

Generally, financial experts recommend spending at most about 30% of your monthly budget on your house – including your mortgage, utilities, and property taxes. If you spend more than 30% of your budget on your home, you might be house poor.

What’s Wrong With Being “House Poor”?

The problem with being house poor is you lack financial flexibility, especially when times are tough. For instance, someone who spends 20% of their monthly budget on their house is in a far better position to endure a job loss or an unexpected expense than someone who spends 50% or more on their home.

Maybe your dream of owning a big beautiful home is catching up with you. Or, you didn't account for the total cost of ownership before you bought the house. For instance, homeowners association fees, property taxes, utility costs, and maintenance all account for your home's total cost of ownership. Lastly, maybe a change in your income has made you house poor.

Here is the bottom line: The more you spend on your home, the fewer options you have if you need extra cash. We need to be comfortable with our homes, but we also must avoid letting those homes reduce our financial stability.

This means having an emergency fund ready to account for unexpected expenses is essential even if you aren't house poor. I recommend saving at least three months' worth of living expenses in a separate savings account. Separating your emergency fund makes it more challenging to accidentally spend that money while keeping it easy to access when needed.

If you think you’re “house poor,” what can you do about it?

How To Stop Being “House Poor”

If you're house poor, your #1 priority for the rest of 2023 should be improving your financial position. Here are four ways to keep your home from taking a substantial portion of your budget and reducing your financial stability.

Reduce Spending

Try to save more money by reducing your discretionary spending. For instance, cut back on restaurant meals, going to movies, or buying things on Amazon. To cut your spending, the first step is to track your spending. Use tools like Personal Capital, Mint, or You Need A Budget to help determine where your money is going. Then, take an active (and non-judgmental) role in deciding where to trim your monthly expenses.

Refinance Your Mortgage

Depending on the financial climate, refinancing your mortgage could be an easy way to reduce your mortgage payments each month, bringing down the total cost of your home. Sometimes, mortgage lenders will cut you a check if you're borrowing more than you owe on your current loan. This can be an excellent way to lower your monthly mortgage payments and put extra cash in your pocket. Opt for a fixed interest rate mortgage to avoid getting caught off guard by unexpected interest rate hikes.

Boost Your Income With Side Hustles

Starting a side hustle is a great way to boost your income monthly by offering value. There are many ways to create a side hustle, including landscaping services, driving for Uber or Lyft, pet sitting, designing websites, teaching an online course, etc. If you don't mind doing some driving, consider joining a grocery-delivery service such as Instacart. Instacart says that the average driver gets paid about $17 per hour, including tips and the delivery charge.

Move to a Lower-Cost-Of-Living Home/Neighborhood

Sometimes, selling your current home and moving to a cheaper house in a more affordable area is the best way to cut your monthly home expenses. Of course, this is a drastic step and requires moving your family and furniture. However, it might be the best solution to improve your financial situation.

Being a house poor homeowner reduces your financial stability because your home takes a substantial amount of your monthly budget, leaving less money if times get tough. Are you house poor? If so, start by reigning in your spending habits to free up more money. Then, consider refinancing your mortgage, starting a side business to increase your income, or even moving to a lower-cost-of-living area to bring your expenses down.

This article was produced and syndicated by Wealth of Geeks.


Steve Adcock is an early retiree who writes about mental toughness, financial independence and how to get the most out of your life and career. As a regular contributor to The Ladders, CBS MarketWatch and CNBC, Adcock maintains a rare and exclusive voice as a career expert, consistently offering actionable counseling to thousands of readers who want to level-up their lives, careers, and freedom. Adcock's main areas of coverage include money, personal finance, lifestyle, and digital nomad advice. Steve lives in a 100% off-grid solar home in the middle of the Arizona desert and writes on his own website at