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Updated over 10 years ago,
CNN Story on Housing Affordability
I would be interested in the opinions of @dawn aceri, @James Wiseand other midwestern investors on this story:
http://money.cnn.com/2014/05/22/real_estate/home-buying-salary/index.html?iid=HP_LN
In theory, housing prices and incomes should reach an equilibrium, where no place remains consistently "affordable" or "unaffordable", relative to local wages.
But that is in a market that is not only free, but where all actors are both fully informed and rational.
And none of us, never mind all of us, are either fully-informed or fully rational in our economic activity.
So what do you guys think? Is the Midwestern norm (or is it, really, a norm?) of accessible, plentiful and therefore decent quality (true?) housing sustainable over the long term?
I have been thinking about investing in the mid-west, because I think it might be. But I realize that I HOPE that it might be, because I have that whole lingering, American-dream ideology and want to believe that a working family can buy and keep a decent house in a decent neighborhood (ideally on a single income, but that's a whole other discussion.) And I don't want that HOPE to cloud my judgement (that's the whole "rational actor" thing.)
And so that no one needs to feel shy or feels like they need to offer extensive full disclosures, I already know that if I look to buy something in the mid-west, I'll be contact both James and Dawn. I've been impressed.
Thanks for any input.