Is that the median price of a 2 bedroom house in San Jose at the time was 670,000, and prices in Los Gatos were far higher. When I first moved to Silicon Valley 30 years ago, there was a run down shack on the side of highway 101 with "fixer upper: 250K" painted on the side (at a time when a 900sq ft condo was going for 100K).

It wasn't at all unusual for the real estate listings in 2008 to be showing places for sale at 800,000 along with a note saying last sold 725,000 (3 months ago).

There was an awful lot of fanciful valuation going on. It's not surprising far too few people can afford mortgages around here now. I can't afford to move because the move up to properties are still way outside my reach as a single wage earner.

but AFAIK they don't have different notions of the cost of living.
In an area where a cheap 2BR apartment rental is $2000/month like Silicon Valley, and a 4BR house can be $3000/month quite easily, there is a need for those subsidies to be viewed differently.

Yes, raising one causes a raise in the other, but that's water under the bridge now. If any of the existing subsidies were removed (such as mortgage interest deduction), the housing market around here would become completely impossible for anyone to break into unless they inherit or win the down-payment and rob a bank every month to pay for it.

The regular guideline for mortgage affordability is 3x salary. There are so few properties in this area that come anywhere to close to as low as 3x salary I'm surprised there isn't far more distress in the real estate market than is acknowledged.

I live in the NE where housing is more costly than most of the country, but not nearly as costly as major metro areas. I do not expect nor do I receive any subsidies beyond being able to claim my property taxes as an exemption. My mortgage payments are easily over one third of my net income - which is well below $100k. They are less than half but easily over one third.

Part of my mortgage payment is escrowed property taxes. My guess is that any income tax relief that I have realized over the past 10-12 years has been more than consumed by property tax increases. The town find themselves able increase property taxes even in the face of horribly declining property values.

I understand your point, but I am afraid that I find federal lending policies in this instance misguided and somewhat out of touch. Instead of helping millions of people who are truly in housing distress, they subsidize a high income individuals purchase of a million dollar home.

Let them eat cake.

fucking politicians.
Course we only make 45K a year.