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.
