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I have this sense that home prices all over the US are being artificially inflated. That said, if you figure 4% interest on $1 million, that works out to about
by danblick 10y ago
I have this sense that home prices all over the US are being artificially inflated. That said, if you figure 4% interest on $1 million, that works out to about $3333 per month. Q: Are there enough people in the Bay Area who are willing to spend ~$3333/month to live in a home currently priced at $1M in order to support that price level? A: Yes, I think so. (Granted, $1M would be quite low for a house near where I live in Mountain View, but maybe the numbers don't seem so crazy?)
- sagarm 10y agoInterest isn't the only cost to own a home. http://www.nytimes.com/interactive/business/buy-rent-calculator.html http://www.nytimes.com/interactive/business/buy-rent-calcula...
- deleted 10y ago[deleted]
- danblick 10y agoI think "home price appreciation" is one of the more interesting factors here. If home prices grow at 4% and wages don't keep up, it seems like that's not likely to be a sustainable over the long term.
- sagarm 10y agoThat is why housing costs have generally risen with inflation on average. Appreciation in the Bay Area and other denser areas have seen prices grow at more than inflation, which is probably attributable to restrictive zoning limiting supply over the long term. I agree that's not sustainable economically, socially, and hopefully politically.