the advantage gets priced into desirable markets. If interest rates go up, house prices go down. Why? because people cannot afford to mortgage as much when they

the advantage gets priced into desirable markets. If interest rates go up, house prices go down. Why? because people cannot afford to mortgage as much when they pay more interest per dollar borrowed. inflation (or the expectation for ones income to keep up with inflation) incentivizes spending more on houses (so long as the mortgage APR is below inflation) because the inflation is eating the debt YoY. So you may as well buy a lot of house. That is until they raise the rates, or your income doesn't rise, etc. Then see 2008.