Are You About to Be House-Poor? A Stress Test for RSU-Heavy Households

Most home affordability calculators answer the lender’s question: what is your monthly payment, and does it fit a 28/36 debt-to-income rule? That math approves you. It does not tell you whether the purchase will hold up when your RSU vests drop 40%, a layoff stretches into the next quarter, or a $40,000 repair shows up in year two.

For high-income, RSU-heavy households buying $1.5M-$3M homes in Seattle, the Bay Area, NYC, or other expensive metros, the more useful question is: can I afford this without becoming house-poor or fragile under realistic stress? Lender approval and household resilience are different tests. Below are the four stress scenarios that actually matter, plus a calculator that shows your housing burden ratio under different RSU drawdowns.

The bank approves you, life doesn’t

Lender underwriting standards are necessary but insufficient. The Consumer Financial Protection Bureau’s Qualified Mortgage rules use a back-end DTI threshold of 43% for many loans (calculated as monthly debt obligations divided by gross monthly income), with various other safe-harbor and presumption rules layered on top.¹ That standard is built around what lenders need to safely originate a loan, not what households need to safely live with one.

The Joint Center for Housing Studies at Harvard uses a different and more household-relevant standard. JCHS defines a household as cost-burdened when housing costs exceed 30% of income, and severely cost-burdened when housing costs exceed 50%. Half of U.S. renter households were cost-burdened in 2022, and over a quarter were severely cost-burdened.² Those thresholds were built from decades of empirical evidence about which households end up in financial distress. They are the right benchmark for the home-buyer side of the question, not just the renter side.

The implication: the lender may approve a house that pushes you well past the 50% severely-cost-burdened line on a base-only basis. The bank cares about your gross income and conforming-loan rules. You should care about whether the housing cost is sustainable on the income you can actually count on.

True monthly housing cost is bigger than PITI

Most monthly-payment calculators stop at PITI (principal, interest, taxes, insurance). PITI is real, but it is not the true monthly cost of an expensive home. Three categories often get missed.

• Maintenance reserve. A common rule of thumb is 1% of home value per year. For a $1.8M home, that is $18,000/year, or $1,500/month. Some homes need less; many need more. Ignoring maintenance entirely makes the house look more affordable than it is.
• HOA, special assessments, condo fees. Condominium and HOA-governed properties carry recurring fees that can rise materially over the holding period.
• Repair shocks. A $1.8M home with a 2% repair shock means a $36,000 surprise bill. Roof replacement, sewer line, foundation, HVAC, and water-damage remediation regularly land in the five-figure range. The lender does not stress test for these; you should.

For the cleanest framework on cash, economic, and exit-value views of housing cost, see The True Cost of Owning a Home.

The RSU dependence test

For tech-employee households, the most important affordability question is whether the home is affordable on salary alone, or whether the plan depends on RSU vests continuing at the current rate. RSU income is real cash flow. It is also volatile.

• The dollar value of RSU vests scales with the employer’s stock price. A 30-50% stock decline directly cuts vest income by the same percentage.
• RSU vests stop entirely on layoff. Severance may bridge a few months; it does not bridge a year.
• Holding RSUs after vest creates concentrated employer-stock exposure. For tech workers in expensive metros, that concentration is correlated with the local job market and local home prices, compounding downside risk.

For the full RSU-vs-salary framework and the sell-vs-hold decision, see equity compensation and the RSU cash flow strategy.

The base-only affordability test

Strip out RSUs and bonus. Can your base salary alone cover the true monthly housing cost at a sustainable burden ratio? This is the best leading indicator of house-poor risk. If the answer is yes, RSUs and bonus become real upside that goes to savings, debt repayment, and lifestyle. If the answer is no, the plan depends on RSU continuity, and any disruption to that continuity threatens the house.

Concretely: take base salary, apply a stylized 30% effective combined tax rate (federal + state + FICA-equivalent for high earners), divide by 12, and compare to your true monthly housing cost. If the ratio is under 30%, the home is comfortably affordable on salary alone. 30-50% is workable but depends on RSU continuity. Above 50% means the JCHS “severely cost-burdened” threshold on base salary alone, and the household is materially exposed to RSU volatility.

Post-close liquidity is the real safety net

Lender-required reserves are usually 2-6 months of PITI for conforming loans, more for jumbo. That is a floor, not a target. For an RSU-heavy household, the right standard is more like 12 months of total expenses in liquid reserves after closing. The reasoning:

• A tech downturn that hits the stock price often coincides with slower hiring and layoffs in the same sector.
• Severance plus unemployment typically buys 3-6 months for a mid-career engineer; longer for senior roles, but not always.
• Repair shocks, medical bills, and family emergencies do not wait for the rest of life to be quiet.

Down payments that drain the emergency fund into home equity convert liquid resilience into illiquid concentration. Home equity helps long-term wealth; it does not help next month’s mortgage payment. For the down-payment sizing decision specifically, see how much to put down on a house.

The four stress scenarios that matter most

For a $1.8M purchase by a household earning $300k base + $200k RSU, four scenarios cover the realistic downside.

A purchase that survives all four scenarios with reserves intact is comfortable. A purchase that fails one is fragile. A purchase that fails two or more usually pushes the household into house-poor territory.

Run the numbers on your own scenario

The calculator below is the focused version: home price, down payment, base salary, RSU income, and mortgage rate. Defaults assume a 1.0% property tax rate, $400/month insurance, 1.0% annual maintenance reserve, and a 30% effective combined tax rate. It returns your true monthly housing cost, the burden ratio under both base-only and RSU-stressed scenarios, and a verdict label tied to the JCHS cost-burdened thresholds.

The four affordability verdicts

• Comfortable. Even under a 40% RSU drawdown, the housing burden stays below the 30% cost-burdened threshold. The plan does not depend on stock-price stability or perfect employment.
• Stretch. Under RSU stress the burden enters the 30-40% range. Workable, but the plan should keep additional fixed obligations (cars, premium childcare upgrades, additional debt) tightly managed.
• Fragile. Under RSU stress the burden enters the 40-50% range. The plan can survive a moderate shock but has little margin for additional surprises. A repair, layoff, or further income drop tips the household into severely cost-burdened territory.
• House-poor. RSU-stressed burden exceeds 50%. By the JCHS definition, this is severely cost-burdened. The right responses are usually a smaller home, a larger down payment, more conservative RSU income assumptions, or waiting. Continuing as planned likely forces the household to sell into a bad market or accept severe lifestyle compression.

The tech-city correlation problem

For tech employees in expensive metros, the housing decision sits inside a larger concentration risk. The mortgage payment is fixed in nominal terms. The home’s value is correlated with the local tech ecosystem. The salary funding the mortgage is correlated with the same ecosystem. RSU compensation is correlated with the same employer within that ecosystem. Holding employer stock after vest compounds the exposure.

A San Francisco / Seattle / NYC mortgage backed by a tech salary at a tech employer with tech-stock RSUs and unsold employer stock compounds into a single concentrated bet on the same set of macro and labor-market factors. For the full treatment of how tech-employee income interacts with portfolio construction, see your portfolio is not just your brokerage account. For the inflation-protection side of the same purchase decision, see is a 30-year fixed mortgage an inflation hedge?

Five practical rules for high-income RSU buyers

1. Underwrite to base salary, not total comp. The base-only burden test is the most important number in the affordability decision. RSUs and bonus are upside, not dependable income.
2. Keep 12+ months of total expenses post-close. Lender-required reserves are a floor, not a target. The downside scenarios that hit RSU-heavy households tend to be longer than 6 months.
3. Sell RSUs at vest unless you have a specific reason to hold. Holding RSUs after vest stacks employer-stock concentration on top of an already-correlated job and home. The default should be diversification.
4. Do not let the down payment drain the emergency fund. A 25% down payment that leaves you with two months of expenses is more fragile than a 20% down payment that leaves you with twelve. PMI is a manageable cost; an empty emergency fund is not.
5. Do not buy a house that requires future refinancing or stock recovery to make sense. The plan should work at today’s rate and today’s stock price. A future refinance can be a bonus; it should never be a requirement.

When to wait vs when to buy

The calculator and verdict framework can identify when a specific purchase is fragile, but they cannot tell you whether to wait. That decision usually depends on factors outside the affordability math:

• Rate environment. Buying at a rate you can afford and refinancing later is reasonable. Buying at a rate you cannot afford and assuming you will refinance is not.
• Life stage. Schools, family, work commute-radius, and aging parents change the cost of waiting.
• Employment stability. A six-month-old role at a new employer is a different financial position from a five-year-tenured senior role.
• RSU vest schedule. Front-loaded RSU grants (large year-1 vest, smaller subsequent years) look better in year-1 affordability tests than they actually are.
• Family logistics. Daycare, school district, partner career flexibility, and elder care can outweigh financial fragility in either direction.

Most readers in the high-income, RSU-heavy demographic do not need a calculator to tell them that an expensive house is expensive. They need a framework for knowing whether the purchase is sustainable across plausible futures, and whether the plan still works when the assumptions soften. That is what the calculator and the verdict framework are for.

Frequently asked questions

What about jumbo loans?

For 2026, the FHFA conforming loan limit for one-unit properties is $832,750 baseline and up to $1,209,750 in designated high-cost areas (Los Angeles County, San Francisco County, all five NYC boroughs).³ A loan above the applicable limit is a jumbo loan. Jumbo underwriting is typically stricter on reserves, DTI ratios, and documentation, and may treat RSU income more conservatively than conforming-loan underwriting. Plan for the possibility that the lender will not give full credit to RSU income.

Should I count my employer stock toward my down payment?

Generally, sell it first and treat the cash as your real balance. Concentrated employer stock as part of the down payment compounds the tech-correlation problem: a stock drawdown reduces both your liquid reserves and your future RSU vests at the same moment.

What if my partner’s income is stable (not tech)?

That genuinely helps. A non-tech spouse income reduces the correlation between household income and the tech ecosystem. Run the calculator twice: once at full household income, once at the spouse-income-only floor. If the spouse-only test passes a 50% burden ratio, you have meaningful resilience.

How much weight should I put on the maintenance reserve?

Use 1% of home value per year as the working assumption unless you have specific information that justifies a different number. Newer homes in good condition may run 0.5%. Older homes, condos with deferred maintenance, or unique construction can run 1.5-2%+. Assuming zero maintenance for the first five years is the most common error in retail affordability math.

Does the calculator account for the mortgage interest deduction?

No. IRS Publication 936 caps deductible mortgage interest at the first $750,000 of acquisition debt for post-2017 loans ($375,000 if married filing separately).⁴ For most jumbo borrowers in expensive metros, the marginal tax benefit per additional dollar of interest is zero above the cap. The calculator’s 30% effective tax rate is the average household tax burden, not the marginal benefit.

What about renting instead?

For households where the calculator returns a Fragile or House-poor verdict, the right comparison is not "should I buy this house" but "should I buy this house or rent and invest the difference." The rent vs buy guide runs the parallel simulation that answers that question directly.

Related guides

• The True Cost of Owning a Home covers the cash, economic, and exit-value views. The maintenance and tax components live there.
• Rent vs. Buy runs the parallel simulation that determines whether to take on the mortgage at all.
• How Much to Put Down on a House covers the cash-to-close, PMI, and post-close liquidity tradeoffs that this guide’s reserve discussion builds on.
• Funding the Down Payment: Gift, Family Loan, or Sell the Stock? covers where the down-payment cash should come from once the purchase clears the stress test, including the tax cost of selling appreciated stock.
• Is a 30-Year Fixed Mortgage an Inflation Hedge? covers the asset-side resilience angle. This guide covers the liability-side stress angle of the same purchase.
• Your Portfolio Is Not Just Your Brokerage Account covers the tech-correlation framework that motivates the base-only affordability test.
• Equity Compensation Tax Strategy covers RSU vesting, sell-vs-hold, and tax mechanics that determine whether your RSU income is real cash flow or paper wealth.

Sources

1. Consumer Financial Protection Bureau. Qualified Mortgage Rules (Regulation Z § 1026.43). Back-end debt-to-income standards including the 43% threshold for many qualified mortgages.
2. Joint Center for Housing Studies of Harvard University. America’s Rental Housing 2024 and The State of the Nation’s Housing 2025. Cost-burdened (>30% of income) and severely cost-burdened (>50%) thresholds; half of U.S. renter households were cost-burdened in 2022 and over a quarter were severely cost-burdened.
3. Federal Housing Finance Agency. FHFA Announces Conforming Loan Limit Values for 2026. Baseline limit $832,750 for one-unit properties; high-cost-area cap $1,209,750 (150% of baseline) in designated counties including Los Angeles, San Francisco, and the five NYC boroughs.
4. Internal Revenue Service. Publication 936, Home Mortgage Interest Deduction. Acquisition-debt limit $750,000 for post-2017 loans ($375,000 if married filing separately); $1,000,000 grandfathered limit for older debt.
5. Freddie Mac. Primary Mortgage Market Survey. 30-year fixed-rate mortgage averaged 6.23% as of April 23, 2026.