Below is the medium home price/ Medium Income for a few select states. I find this one of the best gauge’s for home prices.
To put this in perspective, here is what happened in the Las Vegas housing market during the bubble years.
I consider the 2.5 to 3 ratio a good buy. Above the 6 mark, I consider it overpriced. One of two things will happen. Either no one will be able to afford housing no more OR home prices will come crashing down to reality.
D.C. and California home prices have gone into the stratosphere.