Quote:
Originally Posted by hmmhmmcamo
I'm going to get flamed for this but here goes...the amount of rent that can be charged has more to do with local income levels than current property values. If not, rental rates would have shot through the atmosphere too, but that hasn't happened.
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I agree with that completely. That's why the price/rent ratio is (imo) a valuable indicator.
It factors in supply/demand on both sides (renting vs owning, a person's two options), and takes the local economy into account, income levels, etc, and takes everything into account equally except for one factor, and that is
speculation which is only prevalent on the side of ownership.