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We took a hard look at the economy before buying our house. Ultimately, we bought when interest rates were high, but prices had not yet come down. There's no c
by jvanderbot 4y ago
We took a hard look at the economy before buying our house. Ultimately, we bought when interest rates were high, but prices had not yet come down.
There's no crystal ball, but it sure looks like our investment will go down in value in the next few years, perhaps precipitously.
I think of it this way: We bought the house we want for the price we can afford, and will happily enjoy it for two decades without price inflation, even though our salaries will likely go up. So, it's a win, even though we bought at what looks like peak market.
- kristjansson 4y agoYup, a house is housing first and an investment second.
- yodsanklai 4y agoI've been waiting for the real estate market to crash for 20 years... On the other, my savings are worth less and less.
- brink 4y agoDon't worry, population collapse will fix this in another ~20-30 years. You'll get there.
- jvanderbot 4y agoDepending on where you live, population collapse is either a myth, meme, overblown but remote possibility, or absolute certainty. In most western nations, it's not going to be that big of a deal, I wager. In areas with net emigration, especially those that are not good at sharing true demographics with their leaders, it'll be devastating.
- lotsofpulp 4y agoI would say population declines within certain tribes leading to changes in political power, and hence distribution of resources, is the central issue in many societies, especially those with very low birth rates. And the tribes are not necessarily delineated along skin color/region of origin/religion, but even age/education/immigration. You cannot plug and play 50M young people from Latin America into the US or Africa/Middle East/Eastern Europe into Europe, and expect society to not change in ways that the existing population might not like.
- desiarnezjr 4y agoIn the US and the Americas it won't have a severe impact. Most countries in America should hold up, and Canada has relatively high immigration levels, so there's that. Much of Europe and large parts of Asia (China! Japan. Korea.) will face jaw dropping population collapses, happening now and in the near future.
- jopsen 4y agoThe US might just ease up on immigration. There is no shortage of people willing to start a new life in the wealthiest economy on the planet. The end of population growth is certainly going to shake things up -- but who is to say how policies won't change to accommodate the new reality.
- brink 4y agoYeah, my wife is an immigrant and the US government makes its best efforts to make immigration as nightmareish as possible. I'll be the first to say the immigration system is broken and needs to be fixed.
- rendang 4y agoIn the US? Prices from 2011-2016 or so were not that bad, and were lower than 2006 in many cities.
- yodsanklai 4y agoParis Steady growth since 1998 https://parispropertygroup.com/blog/2017/how-paris-real-estate-prices-evolved/ https://parispropertygroup.com/blog/2017/how-paris-real-esta...
- rendang 4y agoAh, not surprising, considering it's one of the most desirable places to live in, and you are competing with a growing global rich class to live there.
- adam_arthur 4y agoWell it crashed ~10 years ago, so there was your chance. But lucky for you there’ll be another opportunity soon
- gretch 4y agoGlad you’re content. If you’re in the US, As a bonus, just remember that the US gov always does everything it can to keep housing prices stable or up. Of course it’s not an easy problem for them, but you’re in the same boat as millions of other ppl and the govt won’t let you crash out that hard.
- seanmcdirmid 4y ago> As a bonus, just remember that the US gov always does everything it can to keep housing prices stable or up What country doesn't do this? China surely does that even more aggressively than the USA; Australia, yep; so...Japan? That's the only country I can think of that doesn't mind some long term lowering of housing prices.
- jvanderbot 4y agoThere are 195 countries in the world. A dart thrown at a map would probably not hit a spot that is likely to prop up the general home-owning public.
- seanmcdirmid 4y agoJapan is the only notable exception I can think of.
- roflyear 4y agoHome prices, not adjusted for inflation, are fairly sticky. You may lose some money due to the loan. Not every decision we make needs to be pragmatic. Your last comments capture this. Don't worry about it.
- jandrese 4y agoLook at it this way: you are missing out on 25% rent hikes. https://thehustle.co/why-is-rent-skyrocketing/ https://thehustle.co/why-is-rent-skyrocketing/
- Izkata 4y agoThis was one of the things that convinced me to buy back in 2013 - stable monthly payments for the whole mortgage duration. Just had to get over the down-payment hump.
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- D13Fd 4y agoThat's a good outlook. If it's any consolation, we invested in the market in a big way for the first time in October 2021. We just got the "Congratulations on your first year of investing!" e-mail from the service with a link to our account, which happily displays a big red 25% loss on our solidly six-figure investment. (I do think the stock market losses may be driving a lot of the recession talk. Those losses have happened, for sure)