“Incidentally, the $80,000 household income, as would be represented at the 75th percentile in our region, could swing a mortgage of $310,000, leading to the $345,000 median housing price. That is, of course, assuming no move-up equity and the aforementioned 6% mortgage interest rate.

In this scenario I don’t understand the “no move up equity provision.” The 75% percentile household income earners I have known through life and currently had and have money and equity.Many people in the lower percentiles do also.I would think it fair to expect a good portion of those households bring move up money and could push the median.

In the scenario where the median house has an after tax expense of $1666 dollars a month and is a 3/2 townhome in a decent neigborhood rents start to put a floor if nothing else does.

In any case I agree that incomes do not set housing prices in the long run, competition for them to the extent that an economy and the previously aquired wealth of the populace will allow for does. We have to see where that is at when the funny money effect plays out. This bubble sure did make real estate hard to talk about.