3 ms·
Far and away the main cause of house price inflation has been zero-interest rate fed policy. Demand for 1m houses was high because people could afford it. It
by alpineidyll3 3y ago
Far and away the main cause of house price inflation has been zero-interest rate fed policy.
Demand for 1m houses was high because people could afford it.
It will take a while for people's expectations to normalize, but if rates remain above 5 for years the market will return to earth.
- hgsgm 3y agoZIRP caused regular inflation, which, when not matched by wage increases, caused unaffordability. Land appreciation (not home appreciation: the expensive part of a home is the land or share it sits on) is due to scarcity and underutilization.