This is very very off topic. But it's Friday night, so I thought I'd throw this out there and see what you think.
I've been trying to buy an apartment in Manhattan recently, and am suffering severe sticker shock. A one bedroom apartment that's halfway decent and at least 700 square feet is now going for $700,000.
Yes. you read that right. $700,000. For an apartment. A one bedroom apartment. And a small one at that.
Anyway, I'm starting to think that the real estate market is so completely overvalued and out of control that we might be heading towards a real estate crash along the lines of what we saw in the dot-com stock market about 5 years ago. There is an "irrational exuberance" currently in real estate values, which is putting the cost of residential real estate on a different plane from the price of everything else. Such historically out-of-whack property values cannot last, I fear, and I'm strongly considering abandoning my housing search in order to wait for the crash.
Of course, I also fear that the massive budget and trade deficit and the weakening dollar could lead us towards an economy-wide crash that would have a catastropic effect on housing prices, as well as on the rest of the economy.
So am I correct to hunker down? Or am I making a mistake?