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A comment on Federal Reserve Now Projects Rate Increases in 2023 as Economy Heals. Parent comment

Re:Federal Reserve Now Projects Rate Increases in 2023 as Ec... by lumost on Wednesday June 16, 2021 @04:29PM (#27533113)
When mortgages are expensive, down payments buy more. Except in the short-term it appears that falling interest rates simply raises the nominal price of housing until it reaches the buyers ability to pay the monthly price + down payment.

Increasing interest rates erodes buyers ability to borrow, which will require prices to fall.

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Re:Federal Reserve Now Projects Rate Increases in 2023 as Ec... by errantmind on Wednesday June 16, 2021 @10:29PM (#27535630)
True, but higher housing prices also impede people who save their money instead of taking on 30 year debt. I would definitely prefer higher interest rates and cheaper housing for that reason.
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Re:Federal Reserve Now Projects Rate Increases in 2023 as Ec... by lumost on Thursday June 17, 2021 @09:13AM (#27539209)
agreed, at the margin there are buyers with a virtually unlimited ability to borrow. If interest rates stay low for long enough I'd expect the majority of housing to be owned by hedge funds and investment banks.
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