Going rental rates are more responsive to actual incomes, I think. You can’t get an 3/1 ARM with magical pony dust to cover your rent, it must come straight out of your paycheck.
So, someone who could afford a $2,000 rental payment could afford a $250,000 mortgage, assuming it’s an old school sane fixed-rate mortgage. The fact that $250K sounds unusually low to you just shows how out of whack prices around here are with peoples’ actual ability to pay.
FWIW, in 1996 I remember Rancho Bernardo houses going for $250K-ish. The MM house I’m renting in right now went for well under $200K. And to this day, comparable houses, with larger yards, in my Midwestern hometown go for closer to $100,000.
Yes, I know it’s California… but wherever you are, there’s only so much juice you can squeeze out of a grape.
