That is not realistic.
At 15 GRM, people still go bananas even in crappier pockets. It is possible that this will change but it seems unlikely. If I could buy a place and the revenue could equal the full purchase price in 10 years (where I, the borrower, still get 30 to pay the bank), then everybody would jump in and the effective demand would drive the grm right back up.
The only places you see a grm that low is where rents are really high and interest rates are too.
Again, if rates spike (like to 15%) then that may happen.
But that seems an unrealistic projection as of today.[/quote]
Why do you think they “go bananas”? It’s not logical to buy a house that costs WAY more to buy than rent. If it doesn’t pencil out as a rental then why the demand?
To me it’s just bubble conditioning. People think buying at 30% or so off the peak is a great deal. Never mind that it’s still double the price of 12 years ago.
