Category Archives: Valuation Factors (Price-Rent Ratio, Price-Income Ratio)

Housing and Bonds: Déjà vu All Over Again

Just when people thought we were safe from creative financing applied to bonds backed by homes, a new improved approach is about to surface.  The past year has seen an increase in buying homes for rent by private equity funds and others.  The private equity buyers are funded by their fund investors, much the same […]

Charts of Rent vs. Buy and Inflation Adjusted Home Prices

Based on data from the latest S&P/Case-Shiller Home Price Indices and the US Consumer Price Index, we show a chart of relative costs of renting or buying a home and the impact of inflation on home prices.  Buying is slightly favored over renting compared to the average since 1987 for the S&P/Case-Shiller 10-City Composite.  In […]

Buy vs. Rent and Home Prices vs. Income Favor Buyers

Comparisons of the costs of buying a home to renting a home favor buying, though not by a huge margin currently.  The first chart shows the ratio of the S&P/Case-Shiller 10-City Home Price Index to the Consumer Price Index for Renting a primary residence.  The ratio is scaled so that the average value over the […]

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