Flutterby™! : The high cost of living

Family incomes are about 75% higher than a generation ago, and an average family spends less on clothing, major appliances and automobiles than 30 years ago. Where's it all going?

A generation ago, the one-income family committed about 54 percent of its pay to the basics—housing, health insurance, transportation, and taxes. That is, the one-income family spent about half its income to make the “nut”—the basic expenses that must be paid even if someone gets sick or loses a job. Today, these basic expenses, including child care so that both parents can work, consume 75 percent of the family’s combined income.

And The New York Times asked if it was cheaper to rent or buy, and, for good portions of California, the northeast, and Florida, found that it was cheaper to rent.

For new home buyers, prices in New York would need to rise roughly another 13 percent over the next five years for the average buyer to do better than the average renter over that span. In Northern California, where the gap between house prices and rents is largest, home values would need to go up about 19 percent by 2010.

(Both via Rebecca's Pocket)