By Alice Chen If you've never been able to afford a home in the obscenely expensive Bay Area, now seems like an ideal time to buy. Local home prices have dropped nearly 30% between September 2007 and September 2008. But, prices in prime neighborhoods of areas like Berkeley, Cupertino and Hillsborough seem like they've barely budged.
What causes those neighborhood prices to remain so high? What drove up the prices in those neighborhoods in the first place? And what would make those neighborhoods obey basic economic/market principles? (i.e. average home prices in an area should be no more than 3 to 4 times the average salary.)
How can somebody afford a house in the Bay Area?
My piece will inform readers of indicators to observe to predict the bubble popping in prime areas, and will hopefully help them time their housing purchase.
