The problem are the low interest rates. We need to raise interest rates to lower asset prices. Not just homes but all asset prices need to come down dramatically. Interest rates should be at 15%.
If we raise the rates to 15%, home sales will drop to zero. New buyers still wouldn't be able to afford to buy, and sellers who are selling their primary residence now wouldn't be able to afford to sell due to being fucked as soon as they become buyers since they still need to live somewhere.
Supply and demand determine the price, so the problem isn't the rates, but the demand for housing. Interest rates don't lower demand because people still need somewhere to live regardless of the rates. If the government wants to lower demand, they need to stop subsidizing housing for societal parasites, and deport every single illegal alien that is currently keeping housing off the market.
The problem isn’t low interest rates, it’s affordability. If we put homes at 15% interest the only people walking away happy would be banks because neither buyers or sellers are getting anything from it. The last time asset prices were that high was what the 70s during a market crisis.
Low interest rates, especially rates that stayed low for way too long, were one of the main causes. If loans are cheap and saving is pointless, you get a debt crisis.
But it's far too late for high intereat rates to fix the problem.
Zero immigration will destroy demand and crash the market, bringing prices down with it. Probably the best we can hope for, at this point.
Higher interest rates lower all asset prices. Young people are asset low and labor income high. They want low asset prices. It's people who already own assets that want low rates. Higher rates benefits young people.
You would completely kill the housing market going to 15%. That would put a 300k house which is barely starter home price 30 year mortgage at over 3500 a month. If you go up to the average home price of 512k you’re looking at roughly 6k a month. Unless labor wages magically unfuck themselves for decades of losses there’s no way it brings prices down over completely crashing the market.
The problem are the low interest rates. We need to raise interest rates to lower asset prices. Not just homes but all asset prices need to come down dramatically. Interest rates should be at 15%.
If we raise the rates to 15%, home sales will drop to zero. New buyers still wouldn't be able to afford to buy, and sellers who are selling their primary residence now wouldn't be able to afford to sell due to being fucked as soon as they become buyers since they still need to live somewhere.
Supply and demand determine the price, so the problem isn't the rates, but the demand for housing. Interest rates don't lower demand because people still need somewhere to live regardless of the rates. If the government wants to lower demand, they need to stop subsidizing housing for societal parasites, and deport every single illegal alien that is currently keeping housing off the market.
Both are good things. Raise interest rates and deport all non-Whites. That would help with housing prices.
The problem isn’t low interest rates, it’s affordability. If we put homes at 15% interest the only people walking away happy would be banks because neither buyers or sellers are getting anything from it. The last time asset prices were that high was what the 70s during a market crisis.
Low interest rates, especially rates that stayed low for way too long, were one of the main causes. If loans are cheap and saving is pointless, you get a debt crisis.
But it's far too late for high intereat rates to fix the problem.
Zero immigration will destroy demand and crash the market, bringing prices down with it. Probably the best we can hope for, at this point.
Higher interest rates lower all asset prices. Young people are asset low and labor income high. They want low asset prices. It's people who already own assets that want low rates. Higher rates benefits young people.
Young people are asset low and labor income low. That's the problem.
Their labor income seems low because asset prices are so high.
I thin k 15% is too low. The 4 trillion that Biden pumped into the economy needs to come back out, and high interest rates is the only way to do that.
You would completely kill the housing market going to 15%. That would put a 300k house which is barely starter home price 30 year mortgage at over 3500 a month. If you go up to the average home price of 512k you’re looking at roughly 6k a month. Unless labor wages magically unfuck themselves for decades of losses there’s no way it brings prices down over completely crashing the market.
You're probably right but 15% would be a good start.