3 ms·

Yeah, people miss the good old times with “affordable” houses, forgetting that back then mortgage rates were 9% or something like that, making the payments just

• xyzzy123 5y ago
  Early repayment is more difficult in a low rates, high values scenario. The impact of a small windfall or a pay raise put towards the mortgage gets levered by your rate. IMHO high rates / low values was a better situation for working stiffs. (I'm not 100% confident in this analysis; it seems like there should be an equivalence... but I don't think it's as symmetrical as it seems).
• jeffreyrogers 5y ago
  This doesn't seem to fit the facts. Entire occupational classes today can't buy homes that a single income household could buy in the past. The quality of housing is better in some ways (much bigger, heating, AC in most areas, etc.) but that's not much consolation if you're priced out.
• raverbashing 5y ago
  Yes, and together with it the flood of abusive loans with lower deposits and longer payback periods as if it would make homes "more affordable" (not) Student loans, mortgages, or "how to make money with lower interest rates", convince people to loan more and pay more interest (with a longer period)
• DeathArrow 5y ago
  But let's suppose that someone has accumulated the cash and didn't need a loan. By lovering interest rates and raising prices, not only the people who had to take loans aren't in a better position, but people who did not need loans are also hit. The only winners are the ones speculating real estate.