I sat next to delightful lady on a recent flight from Bozeman to Minneapolis. She told me how she and her husband bought a home a few years back. It was a basic home on the east side of Bozeman, nothing fancy. They owned it a couple of years and sold it, for a 300k profit to a young couple that thought "it would be cool to have a second home in Bozeman."

The other day, I picked up a Realtor guide at the grocery store.  You know, one of those magazines that has local homes for sale. I had to chuckle as I thumbed through the pages. One of the homes had the following description, "check out this affordable home".

That affordable home was listed at 1.1 million dollars.

I can't be the only one wondering, how is a million dollar home affordable?  Better yet, how much do you have to make to afford a million dollar home? I was told that a good rule of thumb is, when buying a home, plan on spending two and a half times your annual income.

According to the median income for the average Bozeman family (55k per year), most of us would be homeless if we followed that formula. In fact, if you do the math, 55k multiplied by 2.5 equals 137,500 dollars. I decided to see what I can buy for 137,500 dollars. I went to zillow.com and clicked on "sort by".  I picked Price (Low to High). So, what could I get for 137,500 dollars?

Absolutely nothing.

Although, I could buy some land for 150k.  Granted, it doesn't come with a house, but I would at least be a landowner right? I suppose you could pitch a tent.  The cheapest home listed on Zillow was 295 thousand. It's a 2 bed 1.5 bath mobile home with 924 sq feet.

picture via zillow.com

If that's not your style, there is a 2 bedroom 1 bath 910 sq foot Condo for sale for 310k.

picture via zillow.com

Clearly, something has to give. However, this isn't anything that we didn't already know.  People can't afford to buy a house on what their current income is. So what do we do? I wish I knew, if I did, I would make enough money to buy one of those "affordable 1.1 million dollar homes".

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