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Housing prices rose much, much faster than inflation or rises in wages. So they are obviously not driven by income. Try again.
by diffeomorphism 2y ago
Housing prices rose much, much faster than inflation or rises in wages. So they are obviously not driven by income. Try again.
- randomdata 2y agoIf people normally paid cash for houses, that might be an interesting point. But most people rent money to buy a house (even while ironically trumpeting "renting is throwing money away"). Like the previous commenter pointed out, real estate-related rents will expand to take up any available slack in income. Now, save recently, the cost to rent money for real estate was in steady decline. That means even a constant income could afford to rent an increasing amount of money. As a result, the price of housing was able to rise disproportionally to income, but proportionally to rent.