3 ms·
Fixed rate mortgage payments are constant, but rents rise with inflation. If people expect high inflation, that may explain why rents look cheap compared to cur
by Bostonian 5y ago
Fixed rate mortgage payments are constant, but rents rise with inflation. If people expect high inflation, that may explain why rents look cheap compared to current mortgage payments on comparable residences.
- Finnucane 5y agoThis is true--we've owned our house since 2009, so our mortgage is about half of what it would cost to rent around here now. But in the short term, there really shouldn't be such a big gap between renting and owning. That means that there isn't a global shortage of housing in the market, but distortions in the market because of external factors. Clearly, right now, a renter is better off waiting and putting the difference in the bank.
- ouid 5y agoIf there is high inflation, the Fed will raise interest rates, crashing the housing market. Not saying you're wrong, but there are many factors to be considered.
- prepend 5y agoHigh inflation is actually good for homes and other assets. The market will be dampened, but home values will rise with inflation. Holding assets is a good hedge against inflation. That and your mortgage is locked so your payment gets super cheap in high inflation situations.
- ouid 5y agoThe government will never allow high inflation as it undermines the willingness to write and sign long term contracts and trade agreements.
- splithalf 5y agoRent control is the norm in our most expensive rental markets.
- 988747 5y agoWhich is the reason why they are expensive...