3 ms·
For anyone relatively young seeing this range and thinking "ridiculous!", it's not. Growing up my parents rate was 12% and in the early 80s rates got up to ove
by time_to_smile 4y ago
For anyone relatively young seeing this range and thinking "ridiculous!", it's not.
Growing up my parents rate was 12% and in the early 80s rates got up to over 17% [0].
It is very possible for the era of cheap money to end across the board.
0. https://www.freddiemac.com/pmms/pmms30 https://www.freddiemac.com/pmms/pmms30
- Ar-Curunir 4y agoHouse prices were also much lower in your parents time.
- reggedtorespond 4y agoRight, and this is a hard point to overstate. The average home price was around $80,000 in the early 80s, whereas it's currently $525,000. If we see home prices drop by 85% we won't be buying homes with US dollars any more.
- xboxnolifes 4y agoThat $80,000 isn't inflation adjusted. Drop would be more like 40%, not 85%. But current home prices don't need to drop. The average price needs to drop. That means more housing. Likely ends up meaning some drop or stagnation in current prices, but you don't need to shift down 40% to reach the goal. Housing in my area is only a little above the 80s price after adjusting for inflation. Of course, the 80s price is nationwide average, while my given price is only the local average.
- czbond 4y agoHigh interest rates on their way up drop the price of homes.
- gdubs 4y agoI recall my parents being very proud of securing a 7% rate in the 90s when they bought our first home. That said, it was a very very inexpensive house compared to today's prices.