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      05-24-2020, 09:47 AM   #23
RickFLM4
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Quote:
Originally Posted by GenXer View Post
Are people getting underpaid now because an average price of a house is $150K today but the median income is $55k

So it's either people are underpaid or the price of today's average home is too high.

1970 $24K home = $158K home in today's money
1970 $19K wage = $125K in today's money

Did I just answered my own question?
So home prices are staying the same. We're just getting paid a lot less.
Why do you assume everything should be comparable to 1970? Many things have changed over the past 50 years. Wealth built through stock market and investment income and appreciation, energy prices, taxes, interest rates, Fannie Mae / Freddie Mac / financing availability, annual inflation rate (particularly in the 1970s), unemployment, types of jobs people are doing (declines in manufacturing jobs / rise in services), home sizes, building standards, population growth (natural and immigration), and on and on. Hard to pick 2 data points and conclude something is wrong because the correlation changed without a full consideration of all the other data points that contributed to the change. I would not bet on a major decline in home prices or a spike in earnings because the relationship is no longer the same as 50 years ago.
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Last edited by RickFLM4; 05-24-2020 at 09:58 AM..