Affordability Survey - Housing
Demographia just update their housing affordability survey. I leave it for you to check out your area on your own.
Vancouver market that I just sold out of is median housing to median income unaffordable 8.4. I estimate it was around 4ish when I first got into the housing market and it simply left you severely house restricted in spending choices. I believe last year's report had it at 7.7.
The US has declined a wee bit. The average last year was 3.7 for affordability and now it is 3.6.
Page 18 says that in LA in 2000 29% of median income was required to pay median mortgage and now it is 82%. Vancouver has gone from 41% to 71%. I know Vancouver's market, there was a price dip around 2000, my home I bought in 1995 was worth about 10% less.
Ouch, out of 227 communities, vancouver was the 213th least afforable.
On another note, tomorrow's open should be brutal. I think the Nikkei has lost about 1100-1200 points between the last two days. Canadian markets were hard it today.
I just read from a world perspective there has been something like $5 trillion wiped out this year, and that is going to hit pensions bit time.
I have said that I believe "they" can only afford about half of what they have promised in pension, and whether people realise it or not, this is probably true for all of us.
I am for the first time in my life grateful that places I worked until my late 30s did not have pensions. When I consider my decisions for how aggressively I worked on debt, well, it was partly driven by the need to be out of debt and to be able to save for retirement, not save to supplement retirement.
Many people's easy spending a loose savings standards is driven by a belief they will be looked after in retirement by their pension. Pension funds that looked like they were just getting back on track aren't "on track" any more. There will be no choice but to lower payouts.