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Maybe Houses Are Still Too Expensive

Some interesting data posted over at Calculated Risk suggest U.S. home prices may still be a little too high.

The graph (click on it for a larger version) charts the national price-to-rent ratio, a measure of the cost difference between buying and renting. During the bubble, the ratio went way up — it got much more expensive to buy than to rent.

The ratio peaked in 2006 and has fallen significantly since then. But it's still higher than it was during the '80s and '90s, before the bubble. That suggests national home prices may fall a bit more before stabilizing. For more details on the data, see the full post at Calculated Risk.



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