The neighborhood in LA that we used to live in is called Silverlake. Silverlake is a hip, gentrifying area along Hollywood boulevard between Hollywood and downtown. It was the about at the epicenter of the LA housing bubble. I was looking on Zillow.com today to see how real estate is doing. Well here is an example
811 Silver Lake Blvd
1228 square feet
3 beds, 3 baths
Since 2000, it has been sold seven different times!
Here is the sales history
Here is a chart so you can appreciate the trajectory better.
The house price appreciation from start to finish is exactly 2% per year.
Now my wife and I rented a place about the same size in the same neighborhood for $1200/month. When this place sold for $704K in 2006, it would have had a monthly mortgage payment of about $4200/month. What were people thinking!?