Real estate experts warn that housing prices in many markets are too quickly outpacing the incomes of most workers. The widening gap affects families across the country, from Washington D.C. and Rhode Island to Florida in the South and Nevada and California in the west.The problem behind this story, is that it is using figures for all classes, instead of just middle class figures. That is, the two paragraphs above say nothing about middle-income families at all, instead it aggregates all families together. Yet the Associated Press is using these paragraphs to prove that middle income families are getting priced out of the market.
In California, the situation has long been the worst: Only 17 percent of households could afford a home with a median price tag in April, according to the California Association of Realtors.
They've set up an obvious "apples to oranges" comparison, in an attempt to shock middle-income people into thinking that the rich are getting richer.
The AP went on to say that the median home price in California, for the month of May, was $522,590, which is true. But that does not mean that that is the price the average Californian pays for their home. Keep in mind that California has some extremely high real estate located along beaches, waterfronts, and in downtown high-rise condos. Not to forget, California is home to thousands of fat-cat celebrities in places like Bel Air, Santa Barbara, Orange County, and so on. These properties are valued at multi-million dollar prices, and they contribute to the "median price" being over the $500,000 mark.
With that in mind, the California Association of Realtors says that only 17% of all Californians are able to afford the median price. Well of course!! But that doesn't mean that only 17% of Californians are able to buy homes. Most Californians buy homes priced in the $100,000 to $400,000 range. And there is a great abundance of those homes outside of Los Angeles, San Diego, and San Francisco. It really isn't all that bad as the AP wants you to think.
Moreover, there is also a growing number of low-income families, due to the massive influx of illegal immigrants. As more low-income families move in, naturally, the percentage of "overall families" being able to afford homes will decrease.
My moral to this story, is that the Associated Press is a liberal news organzation, that wants you to think that the rich are getting richer, the average family is getting screwed, and that the rich people are to blame.
2 comments:
Hi Steve,
Just came across your article ( a few months after it was written, but better late than never ). I believe that the middle-class are most definetely being priced out of the market. I just moved to LA from Chicago and am in sticker shock at the cost of crappy-looking shacks. $800,000 in a horrible area with bad schools etc. I have $150,000 for a downpayment that I saved over a 5 year period. I absolutely will not buy some crap-shack out in the boonies for 800 grand. CA is insane!! Only people who bought their homes before 2000 or the super-rich can buy. The rest of us are renting. I pay $1600 a month rent in a great area. If I bought that crap-shack, I'd be out $5000 a month. Hello...anyone listening? Flippers did well for 4 years. Good for them. The rest of us who aren't risk takers and just need a nice place to live are suffering because anyone can get these bizarre home loans that make no sense. Between the strange loans and the flippers, the middle-class is just watching it all in disgust. And, guess who will have to clean up the mess when all these geniuses with ARMs are on the street and the banks go under? Me and you, that's who. This idiocy could start a global depression. It reminds me of the Roaring Twenties....easy money, the good life etc. And look what happened. My friend, I tell you now...I'm no economist but there are a few exceptional ones that are freaking out just about now. The state of CA has bad infrastructure and awful schools. Most people are up to their eye-balls in debt. This is really scary. But nobody says or does anything. The housing boom just keeps booming. And yes, the middle class is being squeezed and left out because they are the only people who understand morals and logic. I am certainly not hoping for a meltdown. I feel that everyone deserves to have a home. But all these risk-taking lunatics have screwed us over so badly that when the day comes...and it will that they lose their homes, I might not even feel bad foreclosing on it. M
Anonymous: If you live in OC, SD, LA, or Ventura counties, you're certainly going to pay $700K or more for an average home.
But if you look in the inland counties of Riverside, and San Bernardino, you're going to find homes down in the $150K to $500K range. The $150K homes are anywhere from 10 to 20 years old, and they're not crap shacks by any means.
In fact, the most hottest real estate area in So. Cal are those two counties. The average home price in those counties is still in the $250K range.
Albeit, you'll have a long commute to work. But heck long commutes are a fact of life in all of So Cal.
Post a Comment