Another housing bubble forming

I know a lot of people who decided never to purchase property here in USA ..or Canada for that matter, as it's the same game ..
They'd rather rent, live in a cheap suburb ...work hard, save some money, and at the same time build a house or farm house elsewhere in the world ...in some island paradise ..away from all the greedy capitalist banks ..where life is simple and rich ..
Thats where they will go once it's ready and available ..to live a simple peaceful life ..living off the land ..where nobody comes to repossess your land ..

originally posted by: jacobe001
Historically, housing prices have followed a trend of 2x the average annual income of citizens across the country.

The banking fraudulent derivatives changed all that and they are keeping prices elevated.

US GDP is 16.77 trillion, labor force data claims 120.4 million employed people in the US. 16770000/120.4=$139,285 as our average full time worker income. Obviously, that's pretty far off of the 40k median wage, but that just shows how big the gaps are these days. To have the average income you need to be in the 90th percentile of incomes.

Anyways back to the OP the reason for this is because in 2008 the banks didn't lose their assets, they kept them. There was never a market correction for the home owners, in a true resolution to the bubble the homes would have been offloaded for whatever people were willing to pay but that didn't happen. Instead the homes were kept off the market while the banks balanced out their books using taxpayer bailouts. Things haven't really improved but the banks are putting some of these homes back on the market.

Effectively we have a cartel running the housing market. Cartels are supposed to be illegal in the US.

That said, I've got a great deal on my current apartment. It's about 800-900 sqft as a 1 bedroom apartment and I only pay $450/month with all utilities included. There's a few advantages to living in a poor area... of course I've got about a 1 in 10 chance per year of being the victim of an armed intrusion.

originally posted by: Neopan100
I also read this article about vintage toys (I know...I find some weird crap to keep myself entertained

It gave the cost of the toy (like a BARBIE 8.94 in 1984) Now would cost like 34.00 to purchase in todays money. Another was like a toy car for dolls it was 34.00 bucks in the 80's now over a hundered dollars..it really got me thinking how are money/what we make has really decreased. We have no purchase power.

Back during my fall semester I wrote a paper in one of my classes where I compared the cost of goods using minutes of work to purchase something. I've posted the results here before but you may find this interesting. Note that I'm using minimum wage as my number since that was part of my argument, I'll avoid posting all the charts and details behind all them but
1985: 1 year tuition UPenn 2878 hours, average home 26556 hours, 1 gallon gas 21 minutes 36 seconds, 1 big mac 28 minutes, 48 seconds
2013: 1 year tuition UPenn 5649 hours, average home 42952 hours, 1 gallon gas 28 minutes 48 seconds, 1 big mac 34 minutes, 48 seconds.

Actually on this subject, this is the statistic that says it all in my mind. The minimum wage in 1956 had the same purchasing power as our median wage (50k) today.