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People with mortgages have been making out like bandits for decades, and have recently locked in historically low interest rates that leverage their economic ga
by epistasis 5y ago
People with mortgages have been making out like bandits for decades, and have recently locked in historically low interest rates that leverage their economic gains even further.
This is a huge drain on the economic productivity of the younger generations, and anybody who was not able to afford to buy in to the scheme before the recent climbs.
It's time to make housing behave at most like a savings account, rather than an investment account.
- davidw 5y agoExactly. > This is a huge drain on the economic productivity of the younger generations Economists have attempted to quantify the effects of this, and the numbers are huge: https://www.aeaweb.org/articles?id=10.1257/mac.20170388 https://www.aeaweb.org/articles?id=10.1257/mac.20170388
- Marsymars 5y ago> People with mortgages have been making out like bandits for decades, and have recently locked in historically low interest rates that leverage their economic gains even further. Depends on jurisdiction. Canada's housing market has most of the same problems as the US's, but you can't really lock in low interest rates for longer than five years - so if you raise interest rates, you leave people five years from now underwater and having to renew for the next two decades at high rates.