A reader, Jen, posted a comment on a previous posted titled Housing Prices always go up — not really. Her insightful comment was as follows:

Very sound advice, but according to your rules, only about two percent of the country can afford to live in Southern California. In Sherman Oaks, where I live, the average income is about $62,000; the average price of a home is over $500,000. Since apartments in the area rent for about $2,500 a month for a 1100sqft 2-bedroom, it’s hard not to see the appeal of paying about $3,500 in a mortgage for a home the same size. Of course, that mortgage is about 75-85 percent of a family’s income. In order to “afford” even a tiny house or studio apartment in most SoCal neighborhoods, one would have to be bringing home about $200,000 per year.

Read the rest of this article at the housing bubble site.

Related posts:

1. Housing Prices always go up — not really
2. If you can’t afford your mortgage, get further into debt!
3. Foreclosures, and more bad government ideas
4. Mortgage Short Sale: Forgiveness of Debt and the 1099
5. Housing Bubble News, October 16, 2006
6. Housing Bubble News, June 27, 2006
7. Looking for a Starter Home? Rent.
8. Does 28% gross income for a mortgage include property taxes and insurance?
9. The idiocy of the HELOC (Home Equity Line of Credit)
10. Scary Housing Bubble Mortgage Calculator