4 ms·

Pretty much agreed. My rather simple (and completely argumentative) explanation is that Germans generally are less enthusiastic about taking on debt to finance

by kriro 10y ago

Pretty much agreed. My rather simple (and completely argumentative) explanation is that Germans generally are less enthusiastic about taking on debt to finance things. Psychologically I'd say it's rooted in the fact that the results of hyperinflation are very much in the minds of people and there's a tendency of "don't borrow if you can save for it". Since the only realistic option for buying houses is taking on debt, less people do it. I feel this mindset is slowly going away though. Another point in favor of this "theory": credit cards are relatively uncommon compared to other countries (that's also changing imo). I feel like home ownership is even less of a useful concept these days with ever shifting jobs so I think we accidentally stumbled upon the right strategy. Edit: There's also quite a few buildings that are owned by a "Wohnungsbaugenossenschaften" (basically a https://en.wikipedia.org/wiki/Cooperative https://en.wikipedia.org/wiki/Cooperative for housing)

krautsourced 10y ago
It's not about inflation, since inflation is actually good for you if you're in debt (as your debt is not adjusted to the inflation, your debt is effectively shrinking by the inflation). People are still buying and building houses here, especial in rural areas. It's mostly the cities where things simply have become unaffordable for most people.
- paganel 10y ago
  > It's not about inflation, since inflation is actually good for you if you're in debt Like with many things, the devil is in the details. I'd say a 1 to 5% inflation rate is preferable, a 5 to 10% inflation is livable rate, 10 to 20% is starting to get tense, more than 20% and then everything is suddenly more expensive and you risk don't having money to get you through the month. Yes, some of your nominal debt might go down, but, then again, you still probably have to buy gas every couple of days (which is most probably imported, so its price has gone up), with more expensive gas comes more expensive merchandise (things like food, clothes and the like) because carrying stuff around consumes gas, your heating and electricity bills will also probably double of triple in value in a matter of a couple of years, and so on and so forth (not to say that you can forget about more-than-basic stuff like having a vacation abroad).

by kriro 10y ago

krautsourced 10y ago

It's not about inflation, since inflation is actually good for you if you're in debt (as your debt is not adjusted to the inflation, your debt is effectively shrinking by the inflation). People are still buying and building houses here, especial in rural areas. It's mostly the cities where things simply have become unaffordable for most people.

paganel 10y ago
> It's not about inflation, since inflation is actually good for you if you're in debt Like with many things, the devil is in the details. I'd say a 1 to 5% inflation rate is preferable, a 5 to 10% inflation is livable rate, 10 to 20% is starting to get tense, more than 20% and then everything is suddenly more expensive and you risk don't having money to get you through the month. Yes, some of your nominal debt might go down, but, then again, you still probably have to buy gas every couple of days (which is most probably imported, so its price has gone up), with more expensive gas comes more expensive merchandise (things like food, clothes and the like) because carrying stuff around consumes gas, your heating and electricity bills will also probably double of triple in value in a matter of a couple of years, and so on and so forth (not to say that you can forget about more-than-basic stuff like having a vacation abroad).