Wow. Apparently, I live in a $1.5 million home. So how does a semi-impoverished blogger like me afford a mansion like that? Well it all depends on how
you The Seattle Times does the math.
Zillow.com “zestimates™” that the modest, South Seattle home I purchased ten years ago for $187K would now set you back a cool half-million bucks, but according to the math wizards at the Times, that number is completely meaningless. No, rather than using present day dollars to calculate the cost of my house — you know, the actual purchase price — the Times insists on valuing my home in terms of “year of expenditure” dollars, ie the principal borrowed plus every penny of interest over the course of the loan.
At least, that’s how the Times insists on calculating the cost of the light rail portion of the Roads and Transit package headed to the ballot this November. Rather than simply reporting the $10.8 billion price of the rail proposal, they insist on presenting a $30 billion price tag after 40 years of interest and inflation is worked in. Likewise, a half-million dollar mortgage at 7-percent would total about $1.5 million in principal and interest over the course of a 40-year loan. See how that works?
But of course, I don’t live in a $1.5 million house. I live in a half-million dollar house. That’s about what it would fetch on the open market, and that’s about what it would cost me to replace it with a comparable house in the same neighborhood. To claim my house is worth three times that price would be just plain silly. And misleading.
The same holds true of light rail.