Next to taxes, housing is probably the biggest expense for most people. How much house to buy is an intensely personal decision, based on how many people live in a house, how much houses cost in an area etc. Most experts recommend buying a house that costs 2-3 times annual income. This article in MSN Money considers the various factors involved in making a “how much house?” decision.
It is really important to consider all the other expenses involved in owning a house: property taxes (which have a tendency to increase every year), maintenance, heating, hydro, insurance, water and sewer, all the extra furniture and a small fortune to be spent at Home Depot. Another article humorously depicts all the extra money needed to move into the new home.