[quote=CA renter]…limiting collateral calculations to a LT average…[/quote]
Thanks, CA renter. The period used for the long term average is hard to pick perfectly, but it should be long enough to always cover at least the full length of the last upswing and the last downswing. In So Cal, that tends to be 10-20 years, so I chose 15.
Of course, my suggestion will not be implemented. Why? Because it would be very effective in limiting bubbles, and it would limit the upswing profits of the finance and RE industries, and would give homeowners no hope of big future gains on their live-in money generators.
