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Explaining the insane price of NYC real estate

Everyone wants a bite of the Big Apple. But it comes at a high cost. New York City's median home sale prices in 2013 exceeded $855,000. In comparison, the U.S. median home sale price in 2013 was less than $200,000.

To the global rich though, New York is a bargain. From the Chinese to the Russians, foreign buyers are scooping up real estate in New York City at a record pace. The reason? Brokers maintain that many buyers, specifically the Chinese, are investing here so that they can own property close to colleges and universities. And in many cases they are buying sight unseen.

So the Big Apple's insane price tag simply comes down to one of the most fundamental concepts of economics: supply and demand.