You will get there, the pendulum always swings a little too far the other way for a short time so be patient, set your target price and stick to it. The rent multiplier will create a floor and a 1k a month rental will probably never go below 100k and probably will only spend a few months much below 150k before an investor or a renter decides it is close to a wash for them (depending on hoa/taxes being reasonable). Despite the vandals and the crime the numbers make too much sense at those levels. What I can say for sure is that they will not return to those sub 100k levels and I think those sub 40k prices may be misleading as they sometimes are fractional numbers of a multi-unit sale or a transfer between corporate divisions or relatives in order to keep the property taxes low. I could be wrong but even in the 1980’s it was hard to find a 2br for under 500/mo in the seediest areas making those a steal. Just think in terms of others, if you rent for 1,000 and can own for 1200 to 1400, after the tax credit it get real close to even and the average joe buys. If the purchase payment is double the rent and the opportunity of huge profits is no longer a near term reality the average joe continues to rent. If you see 130-150 ranges this winter, jump on it. Using this rent multiplier a poway or 4-s home that rents for 2k a month would be priced at 300k and even the most bearish would jump on that train.
