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To understand this, understand that to older homeowners and a significant slice of the financial industry this is a huge success. To everyone else it's a disas
by api 3y ago
To understand this, understand that to older homeowners and a significant slice of the financial industry this is a huge success.
To everyone else it's a disaster.
- layoric 3y agoAbsolutely, same here in Australia. Using markets as a mechanism for price discovery (what they are good at) for a necessity has gone predictably badly. Yes, people will put themselves in huge amounts of debt for a secure living situation, shocking I know.. /s.
- api 3y agoI don’t know about Australia but the real problem in the US is that the aforementioned interests (homeowners, speculators) have acted effectively like a cartel to restrict supply. They do this by pulling out every possible objection to block construction permits. Price signals work if supply can raise to meet demand. When house prices go up it becomes more profitable to build, etc. But when the supply side mechanism is blocked for a necessity then prices will just go up, and up, and up… especially if it can also be bought on leverage.