Prices of Bay Area houses rose nearly 20 percent over the 12 month period ending in February, reaching a new record median price of $569,000 paid for existing single-family houses.
My gut feeling is that it’s just a matter of time. To me, “the bubble hasn’t exploded yet” doesn’t mean that it isn’t going to. Prices can’t keep going up. At some point, people can’t afford to pay the higher price and you can’t sell for a price that no one can afford. It seems to me that we are very close to that point. My wife and I both work and bring in a pretty good combined salary and yet we couldn’t buy a house here without making some significant sacrifices in our lifestyle. And this would be to get a pretty ho-hum house.