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How have other countries dealt with that? In Norway, the cap you can borrow is 5x your income. This cap is total of all loans (student loans, mortgages, limit o
by matsemann 5y ago
How have other countries dealt with that? In Norway, the cap you can borrow is 5x your income. This cap is total of all loans (student loans, mortgages, limit on your credit cards etc)
Not sure of the effect, but perhaps it has cooled it somewhat You notice certain "bands" on apartment prices. An apartment for a single person is capped at ~5x what a single person makes, then there is a gap until the next band etc. One problem is that normal people are capped, but someone with upper class parents can get help to win the bidding round by bidding just above what most people can. So it can feel unfair, at the same time one probably shouldn't be liable for that amount of loans as well. Dunno.
- cianmm 5y agoIn Ireland we've got a cap of 3.5X income (which banks can sometimes stretch to 4.5 income but it's pretty difficult to do due to government limitations) and that hasn't seemed to have helped house prices much (although it was iirc more to stop a housing bubble and crash rather than to keep house prices down). It's just meant that it's easier for investment firms and cash-buyers to outbid everybody else.