if expenses are 40% of the income, you still get almost 9.5% cap rate
+ probably $35-40K a year depreciation
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Many of today’s residential buyers are NOT ‘highly qualified’
they are just qualified.
In many cases one can go up to a 50% debt ratio with a 1% down payment. Many people only bring home 70% of their gross income.
Easy lending does not make housing affordable, it actually makes it unaffordable to many with high prices.
if mortgage rates rise too much, payment amounts will be out of reach for many people. Prices are artificially high because rates are low but rates could stay low for a very long time
Kim Kardashian could be a grandmother and Oprah could be pitching reverse mortgages to supplement her income by then.
Are we in a bubble OR is it just the ‘new normal’ ??
