patrick.net

Hey, that's *my* thesis!

People think inflation is going to save the day, but there are many other rentiers in line for J6P's wages than the LL.

Federal & state income taxes, FICA, medical insurance, gasoline to get to work -- these all come out of rents and also out of how much we can afford when buying.

My thesis is that housing is the underappeciated shock absorber in the system, that taxes, medical insurance, and gasoline can be doubled or tripled and our standard of living wouldn't change, as rents and house payments would be driven down dollar for dollar.

Here are some 1952 price stats
http://www.fiftiesweb.com/pop/prices-1952.htm

Note: I also found the avg price of a house at $9050 here
http://www.thepeoplehistory.com/1952.html

House: $16,800
Average income: $3,515
Ford car: $1526-$2384
Milk: $.96
Gas: $.20
Bread $.16
Postage stamp: $.03
Hen Turkeys: $ .53 lb
Pkg of 6 Bran muffins $.21
1 lb pkg of M&M’s candies: $.59
Gillette Blue Blades, pkg of 10: $ .49
At Sears - - -
Ladies Corduroy Jackets: $4.99
Cotton knit blouses: $1.98
Men’s Rayon Sport Shirts: $3.66
Men’s cotton flannel shirt: $1.79
Red "Radio Flyer" wagon: $8.75
Westinghouse Open-Handle steam iron: $19.95
Men’s T-shirts and briefs - - -
T-shirts, 2 for $.59
Briefs, each : $.59

I will not pay 2/3 income for a Ford. Ever. I pay 1/2 income for a GMC Yukon.

how many HaHa's is that again?

That's why it was the American DREAM. It was all a dream. Now back to reality. $550k please.

Can you imagine what a 5 year mortgage costs per month on a 500k house?

It's all about the man trying to keep us down. T-shirts cheaper than M&M's, I mean.

Zlxr says

I think the M&M’s price must be off.
We used to go to the store and get 25 cents worth of candy - and it was enough to get sick on.

My mother-in-law saved random newspapers - one of them, which I just gave to my son, had bananas at 9 cents a pound. Wow. It also mentioned a few products that no longer exist. The cool part was the front page, which chronicled the moon landing and first steps. Underneath it was a teeny article (continued on the next page) about a guy who wrecked and walked back for help. leaving a young girl to die.

Chappaquiddick. What a trip.

Hey, when I was a little kid (1967) I was 7 and I asked my dad, Why do we have a nice house and a pool at the local CLUB, and the Indians and Chinamen are living with dirt floors, I asked wont they want to live more like us, and we will have live with less, and he said there will come a day, that day is here.... they want to eat, work, live with BED, and real floor. So we will all learn to live simpler for all. (better for them, lesser for us, but we will be OK)

gas was 88c in 1998 for crying out loud

If you want land where no one is around, where there is no demand, 5-7 years seems reasonable.

If you start competing with others, then others are the ones who are driving up the price. You might be willing to pay 5-7 years, but someone else is willing to do 10, others 15, 20 or 25. If you want something, you have to wait for *all* of those people to take their picks and then you get what is left over. *IF* you want to compete, then you need to up your game.

My parents bought a fantastic house in 1960 for just 13,000. In 1952 18,000
would have bought them a mansion.
As late as 1976 I could have bought a great house in South Pasadena for as little as
29,000 but I couldn't quite make the 20 percent down payment on a 6500 dollar per year job.
It's only since about 1980 that prices have gone crazy to the upside.
When I was a kid an unmarried gas station attendant owned the house next to ours on a
single income of about 75 dollars a week with no overtime. He also drove a convertible that was just a couple of years old. He lived like a king with an ordinary average paying job and had no money worries at all. In my book that was the real "American Dream" not working yourself to death just to pay for an overpriced house you have no time to enjoy.

My dad bought a new house in Palo Alto in 1948 - after he demobilized. He paid $11,500 for that 900 square foot house on Cowper St. I'm not sure what he was making at the time but he had a good union job as a lineman for ATA&T. IIRC that was "GI bill" too even at that time, and IIRC the mortgate rate was around 3% with 20% down.

Zillow says that house sold a few years ago for $1.4 MILLION.

Zlxr says

I think what happened was that somewhere between 1955 and 1965 Developers got hold of much of the land.

Depopulation of city for the suburbs.

The .95 for a loaf of bread seems REALLY high. The hen turkey's at .53/lb seems high as well. Is this accurate? Was food that much more expensive in the 50's?

If you generally multiply everything by 10 to get to today's prices, that's $9.50 for bread, or $5.3/lb of turkey. Bread is 30% of that figure and turkey is half at my local market.