Well, I don’t exactly wonder why the rental prices are so high, at least in light of the purchase prices, but still I wonder who all these people are that afford these houses. Carmel Valley ain’t a small area.
Anyway, my original calculations were a bit off – sorry to get folks’ feathers ruffled – they were including savings in the form of 401k and stock purchase plan (10% of gross); with those backed out, my take home pay was about $7K a month. Still, I can’t imagine spending 4/7 of my take home pay on housing!
And lest we forget – that $1M house renting for $4K a month – the owner is losing money at a pretty rapid rate. Overall gross cash outflow on such a house would be more than $6K a month, no? One good reason to look into the owner’s financing situation before renting!
