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> If inflation were allowed to run a bit higher, it could deliver a long-overdue win for young people who have had to face a combination of stagnant wages and r

> If inflation were allowed to run a bit higher, it could deliver a long-overdue win for young people who have had to face a combination of stagnant wages and rising housing costs. “ Yeah this doesn't make any sense. Housing price increases have far outpaced any increase in wages. If inflation continues to run hot, I expect housing will just get even more expensive especially as investors will be frantic to park their money in something that beats inflation.

j7ake 5y ago
This is wrong because inflation will eat into the size of monthly payments you can contribute to your mortgage, and thus lower the total dollars of house you can buy. Imagine if groceries and gas take more and more of your income. If/when interest rates go up, it will also decrease price of houses because the cost of borrowing will go up, and thus lower the total dollars of house you can buy. If you’ve already bought your house then great, but expect to sell the home at a huge loss when interest rates hit 20 percent.