i always heard the adage home price = 2X annual salary of the people who life there. I suppose with really low interest rates that could go up to 3X.
someone told me 6X at one point in 2020!
i just don't see where all the people who can afford such houses are coming from. so IMO, the house prices in most places will all have to fall relative to median income.
Take a look at wtfhappenedin1971 (https://wtfhappenedin1971.com/)
So much good data to show how real income has diverged. This chart eg shows how it's now 10x income to house price
We see this type of trend globally
At some point it will re-correct, I totally agree, the question is when...?
another metric i find interesting is
the Median home price/Median salary
i just asked Gemini this morning, and here are some values i remember off the top of my head from the hot 2021 market
Austin, TX, being close (8.6) versus to water-bound Seattle (9) was always mind-boggling to me.
these ratios have now dropped and i can only see that happening more in the future.
