Recently, housing analyst Rich Toscano woke us up with a big finding using the S&P’s Case Shiller Index: Since the boom years, current home prices had reached a post bubble low, when adjusted for inflation.
Now, check out his latest determination: When you compare peoples’ current earnings, in salary and wages in San Diego, to what the mortgage plus tax payments are, then the ratios are at the lowest they’ve been ( using available data since 1977 ).
In other words, mortgage payments, in San Diego, have never been more affordable in the context of incomes, for a generation.
Many of Toscano’s central insights over the years have come from the graphs he generates comparing per capita income to home prices and mortgage rates, in San Diego. You can check out his graphs here. During the bubble years, the ratio comparing home costs to earnings had gotten way out of hand but, he writes, “homes are now modestly undervalued.”
Courtesy of: Voice of San Diego
Looking for more Housing Analysis?
Check out a new blog that’s been introduced by Standard & Poor’s Indices. This interactive blog delivers realtime commentary and analysis from across the Standard & Poor’s organization on a wide-range of topics impacting residential home prices, homebuilding and mortgage financing in the United States.
Readers and viewers can visit the blog at www.housingviews.com, where feedback and commentary is certainly welcomed and encouraged.