Home ownership will remain out of reach for millions of Americans, despite slumping house prices

[w¡n9Nµ7 §£@¥€r 123]

Guys, the bubble is bursting. Prices will come down to 2002-2003 levels in many (not all) parts of the country. In my neck of the woods, the most overbuilt segment of the market (condos and townhouses) are already down to 2004 prices and dropping. Be patient and save, speculative bubbles don't last forever.

[one...two...tree 2,762]

Guys, the bubble is bursting. Prices will come down to 2002-2003 levels in many (not all) parts of the country. In my neck of the woods, the most overbuilt segment of the market (condos and townhouses) are already down to 2004 prices and dropping. Be patient and save, speculative bubbles don't last forever.

If I could find a 3 bedroom single family home for under $300 g's in the LA/OC area, I'd be happy.

[w¡n9Nµ7 §£@¥€r 123]

Guys, the bubble is bursting. Prices will come down to 2002-2003 levels in many (not all) parts of the country. In my neck of the woods, the most overbuilt segment of the market (condos and townhouses) are already down to 2004 prices and dropping. Be patient and save, speculative bubbles don't last forever.

If I could find a 3 bedroom single family home for under $300 g's in the LA/OC area, I'd be happy.

It's my sense that (roughly speaking) prices will stabilize when median household income allows for a mortgage equaling 75% of the median home cost. I've heard that before and it makes intuitive sense to me... unless the 'exotic' mortgages of the last few years are now par for the course, which I find hard to believe.

So for a $300,000 home, that means a mortgage equaling $225,000 (assuming a 25% DP) - which in turn will require a household income of $90,000 (assuming 2.5 x income = mortgage).

How much higher or lower than $90,000 is the median household income in Orange County?

Edited June 12, 2007 by Gupt

[one...two...tree 2,762]

Guys, the bubble is bursting. Prices will come down to 2002-2003 levels in many (not all) parts of the country. In my neck of the woods, the most overbuilt segment of the market (condos and townhouses) are already down to 2004 prices and dropping. Be patient and save, speculative bubbles don't last forever.

If I could find a 3 bedroom single family home for under $300 g's in the LA/OC area, I'd be happy.

It's my sense that (roughly speaking) prices will stabilize when median household income allows for a mortgage equaling 75% of the median home cost. I've heard that before and it makes intuitive sense to me... unless the 'exotic' mortgages of the last few years are now par for the course, which I find hard to believe.

So for a $300,000 home, that means a mortgage equaling $225,000 (assuming a 25% DP) - which in turn will require a household income of $90,000 (assuming 2.5 x income = mortgage).

How much higher or lower than $90,000 is the median household income in Orange County?

I have no idea, but once Jinky's working, we would clear that no problem. I'm hoping that we'll be in a position to buy a home in about a year, although I doubt we'll have much if anything to put down.

[w¡n9Nµ7 §£@¥€r 123]

According to the census, median household in OC is $57,791. The 90% confidence range is 53,683 to 61,899.

[one...two...tree 2,762]

According to the census, median household in OC is $57,791. The 90% confidence range is 53,683 to 61,899.

Wow. I imagine the median is a lot higher in the coastal areas - people out here are either really loaded or they are up to the ears in debt (Huge homes, big expensive new cars, and they eat out a lot).

[Hilarious Clinton 452]

It always made me so sad- As a single woman who had worked very hard at my Proffession for 16 years- there was still no way I could afford a home on my own. I may have been able to scrape by with the Mortgage and car payments and maybe a few boxes of Kraft Dinner every week.

The houses far Chicago burbs are afforadable. My home town has doubled in size since I graduated High school 10 years. There weren't even town house here and back in the day all we had to shop at was a Walmart and JCpennys. Now we have everything its great!! I bought my first house at 25. I read Dave Ramsey's book and now try the hardest to pay for everything in cash. I don't believe in car payments anymore and we stopped eating out. All our furniture is second hand and very nice. I have one full time job and one part time job and life its great. I also invested in a Schwab account. People can't settle for a minimum wage jobs. This is America and you can make great money every where. My husband just got here and I have saved cash for his 1st year to attend the local community college. California is to expensive and nuts.

I love your retirement home!!!

I love Dave Ramsey!

[Scott & Lai 12]

According to the census, median household in OC is $57,791. The 90% confidence range is 53,683 to 61,899.

Wow. I imagine the median is a lot higher in the coastal areas - people out here are either really loaded or they are up to the ears in debt (Huge homes, big expensive new cars, and they eat out a lot).

We're just under the median

[one...two...tree 2,762]

According to the census, median household in OC is $57,791. The 90% confidence range is 53,683 to 61,899.

Wow. I imagine the median is a lot higher in the coastal areas - people out here are either really loaded or they are up to the ears in debt (Huge homes, big expensive new cars, and they eat out a lot).

We're just under the median

And you both live off of your salary. Wow. Hats off to you, Scott - it's got to be difficult. I still can't figure out what everybody in places like Aliso Viejo do for a living that can afford such lifestyles. It's crazy.

[Scott & Lai 12]

According to the census, median household in OC is $57,791. The 90% confidence range is 53,683 to 61,899.

Wow. I imagine the median is a lot higher in the coastal areas - people out here are either really loaded or they are up to the ears in debt (Huge homes, big expensive new cars, and they eat out a lot).

We're just under the median

And you both live off of your salary. Wow. Hats off to you, Scott - it's got to be difficult. I still can't figure out what everybody in places like Aliso Viejo do for a living that can afford such lifestyles. It's crazy.

We do have two salaries; Lai has been working for over two years. We are fortunate to have a reasonably-priced apartment in Mission Viejo...a house in a livable area is not a realistic option at present.

[broma25 2]

It always made me so sad- As a single woman who had worked very hard at my Proffession for 16 years- there was still no way I could afford a home on my own. I may have been able to scrape by with the Mortgage and car payments and maybe a few boxes of Kraft Dinner every week.

The houses far Chicago burbs are afforadable. My home town has doubled in size since I graduated High school 10 years. There weren't even town house here and back in the day all we had to shop at was a Walmart and JCpennys. Now we have everything its great!! I bought my first house at 25. I read Dave Ramsey's book and now try the hardest to pay for everything in cash. I don't believe in car payments anymore and we stopped eating out. All our furniture is second hand and very nice. I have one full time job and one part time job and life its great. I also invested in a Schwab account. People can't settle for a minimum wage jobs. This is America and you can make great money every where. My husband just got here and I have saved cash for his 1st year to attend the local community college. California is to expensive and nuts.

I love your retirement home!!!

Thats great 2 jobs to pay for it. When I was in the UK I had a house, car, new furniture a vacation each year, saved and paid cash and only had 1 job......life is hard enough without having to have 2 jobs to pay for things.

Not getting at the poster here just the principle!

[homesick_american 1]

Thats great 2 jobs to pay for it. When I was in the UK I had a house, car, new furniture a vacation each year, saved and paid cash and only had 1 job......life is hard enough without having to have 2 jobs to pay for things.

Not getting at the poster here just the principle!

Chicago isn't a cheap place to live. Your standard of living in the USA depends largely on your education and background but your profession and location play a large part too.

[Trompe le Monde 1,107]

I refuse to buy in SoCal until the prices approach something resembling sanity. A very modest home in my neighborhood (Westside LA) will cost about 800,00. The super-rich do not buy these houses, nor do real people spend that much money on a wood shack when you can rent for a fraction of what that mortgage would cost. My guess is that speculators are driving prices up in my area.

The market must come down.

[~Nini~ 2]

I'm hoping that the prices come down around my fiance's suburb near Philadelphia. Right now I couldn't imagine paying upwards of $500k on a house with our combined salaries. Yeepers!

[GaryC 7]

I am lucky to be above the median for CA and live in the Illinois sticks. The average price for a 3br 2ba house in a good neighborhood is about $150K here. Next year I plan to buy or build a home.