EuroYankee

As always, our local undertaker can be counted on to provide the backdrop to the season. Unfortunately his window display, like the weather, is still stuck in spring mode.

As part of EuroYankee’s ongoing effort to document the arrival of American foods to the German market, today I am happy to welcome Ranch Dip. The German version tastes slightly more garlicky, but is close enough to fulfill all dipping needs.

(photo credit: Generation X-Ray)

I figured out the rent ratio in my medium-sized German city. We’re at 25! No wonder most Germans rent instead of buying.

Figuring out the rent ratio is really easy. Just find two similar houses, one for rent and the other for sale. Divide the sale price by the annual rent and you get the rent ratio. David Leonhart has written about this on several occasions in the New York Times. He says that any rent ratio above 20 is a good indication of a housing bubble. Here’s his explanation:

Throughout the 1970s, ’80s and ’90s, the average rent ratio nationwide hovered between 10 and 14. In the last few years, though, it broke through that historical range and hit almost 19 by the time the housing market peaked, in 2006.

And while home prices — and rent ratios — have always been higher on the coasts, they reached whole new levels recently. In the Washington area, the ratio went above 20. In Boston, New York, Los Angeles and south Florida, it topped 25. In Northern California, it approached 35, higher than it had been in any city, at any point on record.

In concrete terms, a rent ratio above 20 means that the monthly costs of ownership well exceed the cost of renting. At current mortgage rates, for example, a $500,000 house would typically bring monthly expenses of about $3,000 (taking into account taxes, repairs, a typical down payment and, yes, the mortgage deduction). When the rent ratio is 20, that same house could be rented for only about $2,000 a month.

But something makes me think that German housing prices aren’t likely to come crashing down any time in the near future. Which means I’m staying a renter.

(photo credit: mkorsakov)

There was no milk left at the grocery store today. For all those living on another continent, there have been some major milk agitation in these parts. Dairy farmers are pouring milk down the drain to protest low prices. Everyone is predicting a milk shortage possibly followed by something even more scary: an ice cream shortage.

But in my neighborhood Plus, it’s far more likely that they just didn’t bother to stock the milk that is sitting in the back room.

(photo credit: ecstaticist)