Re:Zillow has listed 93% of the hundreds of Phoenix homes it...
by goldcd on Monday November 01, 2021 @05:51AM
(#29064699)
I think #2 is wht needs to be addressed.
If you're just happily living in a house you own, it's nice that the theoretical price is going up, but it's of limited actual benefit to you.
It only has a real impact when you sell - and only has a benefit if the house you want to buy has appreciated less than the one you're selling to pay for it.
Houses falling in value is bad - people are trapped where they are by negative equity, which creates inefficiencies (can't move to a better paying job, as can't sell the house you're in).
The only thing I think is universally bad about house prices rising (along with low interest rates) is that it allows people to re-mortgage their homes (or choose not to pay down capital), to buy another home to rent as an investment (either directly, or through an investment). This creates a feedback loop, creating a class of owners and trapped renters.
I'd have thought the solution here would be a healthy dose of taxation on rental income.
If you're just happily living in a house you own, it's nice that the theoretical price is going up, but it's of limited actual benefit to you. It only has a real impact when you sell - and only has a benefit if the house you want to buy has appreciated less than the one you're selling to pay for it.
Houses falling in value is bad - people are trapped where they are by negative equity, which creates inefficiencies (can't move to a better paying job, as can't sell the house you're in).
The only thing I think is universally bad about house prices rising (along with low interest rates) is that it allows people to re-mortgage their homes (or choose not to pay down capital), to buy another home to rent as an investment (either directly, or through an investment). This creates a feedback loop, creating a class of owners and trapped renters.
I'd have thought the solution here would be a healthy dose of taxation on rental income.