The housing expenditure to income ratio is the ratio between a household's expenditure on housing and its income.
Expenditure on housing includes for home-owners debt service concerning loans for the acquisition of the main residence, real estate taxes on the main residence and utilities. For renters, it includes rents and utilities. For everyone, it includes housing taxes as well and expenses for water and energy.
Income includes wages, income from self-employment, replacement income (sick leave and unemployment allowances), retirement and early-retirement pensions, welfare and family benefits and wealth income. It does not include housing benefits and is computed before taxes.
The housing expenditure to income ratio is called "net" if the housing allowance that the household receives is deducted from the expenditure on housing, and "gross" if it is not.
This indicator makes it possible to measure the burden related to housing expenditure on the household budget and how housing benefits help in mitigating it.