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How is investment in real estate going to outpace inflation when it comes up against the income barrier? I’d argue we are going to see that it won’t. The future
by TimPC 4y ago
How is investment in real estate going to outpace inflation when it comes up against the income barrier? I’d argue we are going to see that it won’t. The future isn’t like the past and when real estate gets too expensive for even the wealthier members of the working class to afford we are going to see stagnation or extremely limited growth. A large portion of the real estate market is homeownership and having that slice of the market disappear would have extreme downward pressure on prices.
- elmerfud 4y agoBecause you're confusing home ownership and real estate investing. Real estate investment is investing in rental properties of some form or fashion and this can be for business rentals it can be personal rentals any number of things. Because that form of investment does not rely on the buying and selling of the property to realize the gain in the investment.
- TimPC 4y agoYou still have a problem with people affording rent if you are buying rental properties at 128x average income. Rent is going to be an inconsequential portion of the interest on the mortgage if someone making average income or even 3x average income has to afford it.