[Ed]

Rich,

I think you’re right, the per capita data we pulled must be different. I’m not use to looking at this type of data so it wouldn’t surprise me if I did something silly. I attached the excel file with the data in the original post. Also here is where I got the data from.

http://www.bea.gov/regional/reis/default.cfm?selTable=CA1-3&section=2

That’s a good point that the per capita income you used tracks well with rent. I’m curious though on if incomes really have increased ~17% more than CPI since 1987… I guess that doesn’t sound unreasonable.

Thanks for weighing in on this.

Ed

[Ed]

Rich,

I think you’re right, the per capita data we pulled must be different. I’m not use to looking at this type of data so it wouldn’t surprise me if I did something silly. I attached the excel file with the data in the original post. Also here is where I got the data from.

http://www.bea.gov/regional/reis/default.cfm?selTable=CA1-3&section=2

That’s a good point that the per capita income you used tracks well with rent. I’m curious though on if incomes really have increased ~17% more than CPI since 1987… I guess that doesn’t sound unreasonable.

Thanks for weighing in on this.

Ed

[Ed]

Rich,

I think you’re right, the per capita data we pulled must be different. I’m not use to looking at this type of data so it wouldn’t surprise me if I did something silly. I attached the excel file with the data in the original post. Also here is where I got the data from.

http://www.bea.gov/regional/reis/default.cfm?selTable=CA1-3&section=2

That’s a good point that the per capita income you used tracks well with rent. I’m curious though on if incomes really have increased ~17% more than CPI since 1987… I guess that doesn’t sound unreasonable.

Thanks for weighing in on this.

Ed

[Ed]

Rich,

I think you’re right, the per capita data we pulled must be different. I’m not use to looking at this type of data so it wouldn’t surprise me if I did something silly. I attached the excel file with the data in the original post. Also here is where I got the data from.

http://www.bea.gov/regional/reis/default.cfm?selTable=CA1-3&section=2

That’s a good point that the per capita income you used tracks well with rent. I’m curious though on if incomes really have increased ~17% more than CPI since 1987… I guess that doesn’t sound unreasonable.

Thanks for weighing in on this.

Ed

[Ed]

Rich,

I think you’re right, the per capita data we pulled must be different. I’m not use to looking at this type of data so it wouldn’t surprise me if I did something silly. I attached the excel file with the data in the original post. Also here is where I got the data from.

http://www.bea.gov/regional/reis/default.cfm?selTable=CA1-3&section=2

That’s a good point that the per capita income you used tracks well with rent. I’m curious though on if incomes really have increased ~17% more than CPI since 1987… I guess that doesn’t sound unreasonable.

Thanks for weighing in on this.

Ed

[Ed]

Thanks everyone for your thoughts.

I think my lack of writing skills is causing some confusion. I know I mentioned comparing SD prices to US prices which infers on an absolute basis. What I meant to say was to compare how the indexes were changing relative to the historical average . The charts are comparing the index, not the absolute value (all cities have a CS HPI of 100 for Jan 2000, if non adjusted for inflation). I agree there will always be a premium to live here but whether or not its changed since 1999, I think the bubble primer on this site does an excellent job of going through that. I didn’t mean to debate that here.

I guess what I’m really wondering about is using the per capita income when determining the price to income ratio. Per capita income is rising significantly faster than CPI. If incomes are rising faster than inflation, then it would justify higher “real” home prices (by real I mean inflation adjusted). Then I wouldn’t expect the real SD HPI to track the historical average.

Thanks for weighing in.

Ed

[Ed]

Thanks everyone for your thoughts.

I think my lack of writing skills is causing some confusion. I know I mentioned comparing SD prices to US prices which infers on an absolute basis. What I meant to say was to compare how the indexes were changing relative to the historical average . The charts are comparing the index, not the absolute value (all cities have a CS HPI of 100 for Jan 2000, if non adjusted for inflation). I agree there will always be a premium to live here but whether or not its changed since 1999, I think the bubble primer on this site does an excellent job of going through that. I didn’t mean to debate that here.

I guess what I’m really wondering about is using the per capita income when determining the price to income ratio. Per capita income is rising significantly faster than CPI. If incomes are rising faster than inflation, then it would justify higher “real” home prices (by real I mean inflation adjusted). Then I wouldn’t expect the real SD HPI to track the historical average.

Thanks for weighing in.

Ed

[Ed]

Thanks everyone for your thoughts.

I think my lack of writing skills is causing some confusion. I know I mentioned comparing SD prices to US prices which infers on an absolute basis. What I meant to say was to compare how the indexes were changing relative to the historical average . The charts are comparing the index, not the absolute value (all cities have a CS HPI of 100 for Jan 2000, if non adjusted for inflation). I agree there will always be a premium to live here but whether or not its changed since 1999, I think the bubble primer on this site does an excellent job of going through that. I didn’t mean to debate that here.

I guess what I’m really wondering about is using the per capita income when determining the price to income ratio. Per capita income is rising significantly faster than CPI. If incomes are rising faster than inflation, then it would justify higher “real” home prices (by real I mean inflation adjusted). Then I wouldn’t expect the real SD HPI to track the historical average.

Thanks for weighing in.

Ed

[Ed]

Thanks everyone for your thoughts.

I think my lack of writing skills is causing some confusion. I know I mentioned comparing SD prices to US prices which infers on an absolute basis. What I meant to say was to compare how the indexes were changing relative to the historical average . The charts are comparing the index, not the absolute value (all cities have a CS HPI of 100 for Jan 2000, if non adjusted for inflation). I agree there will always be a premium to live here but whether or not its changed since 1999, I think the bubble primer on this site does an excellent job of going through that. I didn’t mean to debate that here.

I guess what I’m really wondering about is using the per capita income when determining the price to income ratio. Per capita income is rising significantly faster than CPI. If incomes are rising faster than inflation, then it would justify higher “real” home prices (by real I mean inflation adjusted). Then I wouldn’t expect the real SD HPI to track the historical average.

Thanks for weighing in.

Ed

[Ed]

Thanks everyone for your thoughts.

I think my lack of writing skills is causing some confusion. I know I mentioned comparing SD prices to US prices which infers on an absolute basis. What I meant to say was to compare how the indexes were changing relative to the historical average . The charts are comparing the index, not the absolute value (all cities have a CS HPI of 100 for Jan 2000, if non adjusted for inflation). I agree there will always be a premium to live here but whether or not its changed since 1999, I think the bubble primer on this site does an excellent job of going through that. I didn’t mean to debate that here.

I guess what I’m really wondering about is using the per capita income when determining the price to income ratio. Per capita income is rising significantly faster than CPI. If incomes are rising faster than inflation, then it would justify higher “real” home prices (by real I mean inflation adjusted). Then I wouldn’t expect the real SD HPI to track the historical average.

Thanks for weighing in.

Ed

[Ed]

If we learned anything from the housing bubble mess, it’s to take what the mainstream media has to say with a grain of salt and to think for yourself. I’ve seen article and websites that say it doesn’t make sense to buy but it doesn’t take into account the equity and appreciation of the home. On the other hand its common to hear that you are throwing away money when renting. I simply just do the math to see what makes sense. Of course the tricky part is to guess some type of appreciation range but at least it gives you some type of idea. Paying attention to market trends provided on websites like this helps make an educated guess.

[Ed]

If we learned anything from the housing bubble mess, it’s to take what the mainstream media has to say with a grain of salt and to think for yourself. I’ve seen article and websites that say it doesn’t make sense to buy but it doesn’t take into account the equity and appreciation of the home. On the other hand its common to hear that you are throwing away money when renting. I simply just do the math to see what makes sense. Of course the tricky part is to guess some type of appreciation range but at least it gives you some type of idea. Paying attention to market trends provided on websites like this helps make an educated guess.

[Ed]

If we learned anything from the housing bubble mess, it’s to take what the mainstream media has to say with a grain of salt and to think for yourself. I’ve seen article and websites that say it doesn’t make sense to buy but it doesn’t take into account the equity and appreciation of the home. On the other hand its common to hear that you are throwing away money when renting. I simply just do the math to see what makes sense. Of course the tricky part is to guess some type of appreciation range but at least it gives you some type of idea. Paying attention to market trends provided on websites like this helps make an educated guess.

[Ed]

If we learned anything from the housing bubble mess, it’s to take what the mainstream media has to say with a grain of salt and to think for yourself. I’ve seen article and websites that say it doesn’t make sense to buy but it doesn’t take into account the equity and appreciation of the home. On the other hand its common to hear that you are throwing away money when renting. I simply just do the math to see what makes sense. Of course the tricky part is to guess some type of appreciation range but at least it gives you some type of idea. Paying attention to market trends provided on websites like this helps make an educated guess.

[Ed]

If we learned anything from the housing bubble mess, it’s to take what the mainstream media has to say with a grain of salt and to think for yourself. I’ve seen article and websites that say it doesn’t make sense to buy but it doesn’t take into account the equity and appreciation of the home. On the other hand its common to hear that you are throwing away money when renting. I simply just do the math to see what makes sense. Of course the tricky part is to guess some type of appreciation range but at least it gives you some type of idea. Paying attention to market trends provided on websites like this helps make an educated guess.

[Author]

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