Channon

Financials: How - And When - We Reached the Bottom

PLEASE: I beg of you, if you want to tie housing to income, do it in monthly terms, like home buyers do. Long term (equilibrium) housing prices are a function of income, tax treatment of mortgage costs (interest, PMI) and mortgage rates. A $250,000 house costs a dramatically different price when mortgage rates are 12% than when they are 6%. A $1MM house becomes significantly more expensive when Congress caps the tax-deductibility of mortgage interest.

To view it otherwise is a foolish "analyst mistake" repeated over and over by our innumerate journalists.