Home › Forums › Housing › Housing Market Will Crash 50% by 2010 › -62.45% Real Money (-55.2%
-62.45% Real Money (-55.2% nominal)
Okay, That’s my new prediction. Here’s the math.
Median 2005 Home value was $591,000. Median family income in 2005 was $62,900.
Correcting to base financing and sustainable cash flow. Meaning requires 20% down, current 7.5% rate and max 30% of gross income for PITI.
Future median home value $221,916. PITI = $1572.
Allowing for 3% annual inflation and 6 years of correction, our 2012 targeted home price is $265K. A 55.2% nominal drop in prices.
There, it’s on the table…
Does anybody find it surprising that the PITI number corresponds to what the payment is with exotic loans?
