U.S. house prices are rising exponentially faster than income

Re:U.S. house prices are rising exponentially faster than in... by robocat on Saturday October 30, 2021 @02:19AM (#29046461)

> lower interest rates make houses that are more expensive much more affordable on a monthly basis, which is totally fine as most folks end up with a 30 year fixed rate mortgage

Absolutely false in the long term due to feedback, although it is true in the short term.

With lower interest rates, people bid up the price of houses because they can afford to spend more on their mortgage. The amount spent on mortgage repayments trends towards the same figure as always (approximately as much as your wages allow).

I believe houses are a prime mover of the middle class economy, because it is something most people are willing to “invest” a lot of time working to achieve owning the property they want (often status driven).

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Re:U.S. house prices are rising exponentially faster than in... by arcticbull on Saturday October 30, 2021 @02:21AM (#29046474)

I think we might be in agreement on this - I didn't mean that a house 25% more expensive was more affordable period. I meant it was almost equally affordable after it normalizes. This is a fact a lot of articles and graphs gloss over when they compare simply the top-line numbers.

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