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Tax decreases linearly with the price of the property. At any rate, rents and taxes are sufficiently linked that tax can be ignored for the comparison. As for
by vonmoltke 10y ago
Tax decreases linearly with the price of the property. At any rate, rents and taxes are sufficiently linked that tax can be ignored for the comparison.
As for interest and PMI (assuming you need to pay it), I'd say housing prices falling far enough where rents start looking attractive compared to these qualifies as "something deeply wrong".
- refurb 10y agoThe general rule is you buy if the rent to price ratio is lower than 15. It's currently ~35 in SF.
- mac01021 10y agorent divided by price? As the price increases you become more likely to buy? Also, the monthly rent?
- refurb 10y agoPrice divided by annual rent. $200K house than can rent for $20K per year has a rent to price ratio of 10. It would be wise to buy in this market. Sice housing prices should be linked to what they can rent for, it's a check to see if the two are aligned.
- vonmoltke 10y agoBetween Prop 13, rent control, and NIMBYism I would say there is something deeply wrong with the SF real estate market. It is terribly distorted and I want nothing to do with it, as either buyer or renter.
- bzbarsky 10y agoWhy would tax decrease linearly with the prices of the property? The residential property taxes I've seen are just a flat percentage of assessed value.