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A comment on Home Price to Income Ratio. Parent comment
> If interest rates go up, demand falls and you're left in a highly leveraged position that amplifies your losses.
There is a reason why debt is called “leverage” - it leveraged investment returns up when your the exit works out.
But it also leverages return losses down when the exit doesn’t work out.
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> If interest rates go up, demand falls and you're left in a highly leveraged position that amplifies your losses.
There is a reason why debt is called “leverage” - it leveraged investment returns up when your the exit works out.
But it also leverages return losses down when the exit doesn’t work out.