[chung8123]

The book the two income trap describes this. It talks about better schools etc but if you are competing with people that have two incomes as an individual you better have two incomes worth of salary.

The issues starts to arise that people with two income households are more likely to lose one of those jobs and that puts a lot of pressure on the finances if you need both jobs for your house payment.

[estearum]

The price of rent is set by local household wages.

If both partners typically work: rent rises to eat nearly all the gain.

If AI makes everyone 20% more productive: rent rises to eat nearly all the gain.

If minimum wages lift the bottom earners from $7.50/hr to $18.50/hr: rent rises to eat nearly all the gain.

[cheschire]

If you add more lanes to the interstate, people move further out, and the rent rises to eat nearly all the gain.

[ajkjk]

The only countervailing forces are:

* landlords not wanting as much money (unlikely, although it happens at small scales)

* rent control-type policies

* competition

And as far as I know competition is the only thing that works at scale. Although, people tend to emphasize intralocal competition as where this gets fixed. But I tend to think that the even larger issue is that so many places suck to live in (due to schools, jobs, culture, lack of prosocial governance...) that everyone with options congregates in the good ones.

There's an effect every larger than all of those, though, which is wealth disparity. If incomes differ by fewer orders of magnitude then prices can't vary as much across markets. At the end of the day when rich people can and do buy 2-5 homes and everyone else can barely buy one of course you're going to have problems.

[shimman]

This is an easy problem to solve, regulate the amount of profit you're legally allowed to make from renting land you did not create.

We do this in other industries all the time.

Health insurance is heavily regulated to ensure that there are profit caps (think 80/20 rule) this means that the company is legally compelled to actually spend a certain amount on customers of said product.

Imagine if landlords were compelled to spend 80% of their rent dollars in improving the space or helping the renters.

[globular-toast]

You need more than two incomes worth of salary in any country that does income tax bands. In the UK, two people earning 30k each will take home a combined 50k. A single person needs to earn almost 70k to take home the same. And for council tax you end up paying 75% of what an entire household would pay.

[alex43578]

In the US, two moderate incomes see a similar federal tax bill to a single person, with things actually getting worse at higher incomes for the married couple. Is the UK tax code really that different?

[torginus]

It makes more sense to me (both from a personal, and the bank's perspective), that a single person on double income goes to zero salary when he loses his job, thus its riskier lending to him with his monthly payment being 25% of his income, than say 2 people at half salary, in which case one person's income share of loans jumps from 25% to 50%, a financially difficult situation, but temporarily manageable.

[bdangubic]

I agree in principle but I would venture a guess that number of two-income families that can deal financially with a loss of one source of income is very low.

the very first financial discussion I had with my wife (fiance at the time) was that we will always live off a single salary and 2nd salary will always go into future bucket (we tap in for larger purchases or fancy vacation here and there). I don’t think many families are setup this way though - in my limited personal experiences a loss of one source of income leads to sale of the house/condo and move (rent or downsize)