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House Price Datapoint of the Day

Borrowing has to be taken back to where it was in the late 1930's. A person may borrow 2.5 times their annual salary for a home with 20% down. The median wage (2007) is $50,233.00 (wikipedia) therefore the median house price should be 125,582.50 just slightly below the 203,100 listed in the article. Unfortunately, the dose of reality that faces the U.S. is when there is overshoot there will also be undershoot. In theory, the highest median house price was 262,600 in March of 2007 (investmenttools.com) This means that houses overshot the median by 137,015.50, therefore, the median average may undershoot the median by 1/2 the overshoot. This leaves house prices somewhere around the 57,000 range (lower if the median wage drops over time).