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Anecdote time. In 1995, my dad bought a house in Southern California for $550k. He was able to afford that on a $150K salary and my mom did not work. Today, t

Anecdote time. In 1995, my dad bought a house in Southern California for $550k. He was able to afford that on a $150K salary and my mom did not work. Today, that house is just under $3M. In order for me to afford that house today, I would have to make around $600K. Housing "market" is not a market.

dragonwriter 3y ago
> In 1995, my dad bought a house in Southern California for $550k. He was able to afford that on a $150K salary and my mom did not work. > Today, that house is just under $3M. In order for me to afford that house today, I would have to make around $600K. So, a house that you could afford on a 95th percentile household income (about 5× median) in 1995 takes about a 98th percentile household income (about 8× median) today? Not seeing a lot of significance here. > Housing "market" is not a market. Some things having demand increaae more than supply doesn't make then “not a market”.
- game_the0ry 3y ago
  > Not seeing a lot of significance here. $150K in 1995 is ~$300K in 2023 dollars. See the significance now? > Some things having demand increaae more than supply doesn't make then “not a market”. A market that benefitted from the downtrend of interest rates to ZIRP, PPP "loans" (more like grants), investors (which make up 20-30% of buyers, though they make like 1% of owners), and a Fed with $8.2 Trillion on balance sheet, is not what I would call a functioning market. Questions worth contemplating - if all the post covid stimulus did not happen, what would have happened to the housing market? And what would have happened to the economy? Shouldn't the rate of increase in income track with rate of increase in house prices?