1. If there is one thing we have learned over time it is that history tends to repeats itself.
2. Interest rates for mortgages above $4147K are lower here than areas that dont benefit from the 697K super conforming rates. The jumbo rates area couple percetnage higher.
Here is the other thing you are missing. Even though interests may be the same elsewhere there is more demand here from outside the area. When affordability rises here, people come here that couldnt before. Demand prices drives higher here in ways it cant in Paducah.
3. Real estate taxes are a big deal in keeping people in place. While some things are more expensive here back east my car insurance would be double, my health insurance would be a few hundred dollars more, my heating/ac bill at least $300/month more, my car would need to be replaced more often, snow removal, my brother in law spends close to $1000 a year for a Fall leaf clean-up on his 1/3rd acre property (thats what my total annual bill is for a weekly landscping service), vacations would be more often/expensive (we get to live where people come for vacations of a lifetime) and dont even get me started with the keeping up with the Jonses menatality back there (my kids are fine with clothes from Target where as that is unacceptable to my nieces/nephews in NJ). Relative to other major metro areas in this country I dont find it expensive here except for housing and gas.
4. When supply is low what little sells goes at a higher price. The whole shadow inventory/constrained supply we have been going through pretty much proves that.
5. My point was not about people coming to retire here but rather staying in their homes after retirement which happens far more often here than other prime metro areas.
I was not asking you to leave but rather asking you to look in the mirror and ask yourself why you are here. The reason is because it’s a great place (which you said) and people are willing to pay more for great things. It is not denying the basic rules of accounting in anyway. It is about priorities. Of course we all have to eat but there are lots of other more discretionary items. People are willing to devote a higher percentage of their income here than other places.
It sounds like you are evaluating those priorities right now and may choose to leave. You are going through an evaluation of those priorities right now. I am rasing kids right now and cant think of a better place to do so. I am in a great school district and you dont have to be in anything close to the top 3% to afford a home here. You can also rent a home. The “laws of accounting” are working fine here its just the inventory that is constrained. Hopefully we will get more invetory turnover but I just dont see it changing dramatically to either side. I guess we’ll just have to watch and wait.
Got a #6. Technology has allowed people to work more remotely and that has allowed many people to work from home and to choose where that home will be. Higher income folks can move here and live a better lifestyle which they can afford. I have a good friend (independent business consultant) that is leaving NYC after 47 years and moving to my neighborhood because he can. Lower income folks can also leave here and live a better lifestyle in place they can afford.
Lastly, its easy to try and discredit points one at a time but its not any single point that makes a difference but rather all in concert that do. Each one contributes a little and together they make things behave as they do.
