Watchhttp://ochousingnews.com/news/orange-county-monthly-cost-of-ownership-hits-1980s-levels
Let that sink in for a moment. In April of 1989, the median home price in Orange County, California, was $206,000. With a 10.77% interest rate, the monthly cost of ownership on a median priced home was $1,926 per month. In October of 2012, the median home price in Orange County, California, was $428,000. With a 3.5% interest rate, the monthly cost of ownership on a median priced home was $1,922 per month.
Each month before I prepare the OCHN market newsletter, I think about ways I can improve it and deliver more value to users. This month, I added a new metric to the report that I believe provides a more intuitive way to look at the current state of the market. I applied the mortgage interest rate to the median home price to backward calculate the monthly cost of ownership for the market. I like this approach because it returns a number immediately comparable to rent. When I first thought about this indicator, I didn’t think it would reveal anything of...