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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: John Chen who wrote (186455)	3/8/2009 1:42:25 PM
From: Dan3	Respond to of 306849

Re: ""mortgage" cost is back to $4200 per month." Can't follow your calculation back to $4200/month. Are you comparing: $800,000 ( mortgage only ) with $400,000 ( mortgage + T&I ) For most homeowners, what makes a house affordable or not affordable is the monthly cost of the mortgage. Whether it's collected as part of the monthly payment or not (it usually is), Taxes and insurance are, as far as the homebuyer's budget is concerned, part of the mortgage payment. I was just trying point out that property taxes can make a house unaffordable to buyers even if the home price drops to zero. In other words, what a buyer can afford isn't really $200,000 or $500,000, instead what they can or can't afford is monthly mortgage payment associated with that house price. If the property taxes are equal to what they can afford for a monthly housing payment, then they can only afford zero as they price for the house, itself.