This thread is kinda fun. We need some controversy around here sometimes.
dcarl, as was mentioned before, very few can truly “afford” a home in San Diego so by your own definition, there’d be very few buyers. “Affording” a house using a toxic loan is only delaying in inevitable — foreclosure.
I own a home and it’s quadrupled so I’m no, I’m not a bitter renter. I’ve been wanting to “rightsize” and keep my current home but it hasn’t made sense yet.
We should expunge the ownership mentality out of minds. It’s the cost of shelter that counts. All else being equal, if you can rent for 1/2 the cost of buying then why buy? Even if you can afford it?
If your Navy officer invested his money well, he should be way ahead of the buyers who bet everything on housing. Remember, once appreciation stops, it costs a lot to service the debt.
Let’s put on our positive hat for a minute and assume that there’ll be no major price drop. Say we have a stagnant market for 7 to 10 years; and imagine a middle class family paying the interest-only on a $750k house year after year. At the end of that period, they’d have no savings and would be starting from zero. A rental family would have a substantial down-payment saved up to buy at that time.
