Even bare land has to be maintained somewhat. You can't just subtract purchase price from sale price and call it done.
Historically interest was never as low as during the pandemic. And most people bought houses using mortgages. The average “cost” of owning a house is much more than the selling price, even before you account for the upkeep.
Also, where I live 7% wasn't the case in past 20 years, and even now its rather 1.5% + whatever bank puts on.
I never did those when I was renting. Yes, I didn't get to renovate or pick my paint colours. And yes my money paid down someone else's mortgage. But I suspect if you add it all up...
For better or for worse.
No wonder prices up there have gone bonkers even by US standards.
Non-primary residence of course gets fully taxed.
Then if the house you bought with the proceeds drops in value and you have to sell, you can't claim a deduction for the capital loss.
Of course all capital gains taxes whatsoever have the hidden inflation problem, where you get taxed on the inflation caused by ...
Trudeau was on record a couple weeks ago basically saying "we can't let housing prices fall. if housing prices fall, people won't be able to retire" which is a fucked up admission that there's no way to "retire" without passing debt onto the next generation.
It's not going to end well. It either falls apart in crisis / housing bubble pop, or we end up with some kind of neo-feudalist future slowly developing over the next 100-200 years.
which is a bit of a non-sequitur - who cares what your rent is paying towards? The landlord could be smoking weed with your rent money and you'd not be affected (financially).
The only ones I can think of are depreciation (analogous to capital loss harvesting), 1031 exchanges (loosely analogous to step-up basis; this is the biggest difference) and opportunity zones (analogous to QSBS).
If you borrow against your equities, you can deduct the interest paid on that. That mortgage-interest deductions are bigger is a function of the lending being federally guaranteed more than tax law.
There's no reason to think this trend will reverse.
The total number of children in the world has already peaked (2017?) and is now dropping.
The population growth should still continue for about a human lifespan from here (50-80 years depending on who you ask).
That last growth is just those children growing up and becoming adults. I.e. They are the “last big generation”.
We will see the population drop again, if we dont fuck up the planet before that happens.
I think you would have difficulty finding countries in the world where fertility rates (children born pr woman) are not dropping.
Bangladesh went from 5.5 kids pr woman in 1985 to 2.1 in 2017. This is a global trend.
I'm not sure what you mean by the peak being a benchmark. There's a very clear trend of population growth declining every year since the 60's.
> Even 0.8% is insanely high, at such rate population will double in ~150 years
I think you are missing the part where the rate has been declining every year.
I guess it depends when you are born. Peak population is predicted around 2075, and that's within a lot of people's lifetime.
> Also 'declining every year' doesn't mean it won't start growing again
That's a bit obvious and is equivalent to saying "anything could happen".
But unless you have a good reason for a reversal in trend, then there's no reason to think it will.
"House go up" may be generally true in the abstract, but that doesn't mean this particular house goes up.
The return on housing rents is equal to the minimum (psychological) expectation that landlords expect. It's an arbitrary vig/rake, and like all arbitrary vigs/rakes, it's around 5%. It's an expected gift for owning the house. It's a gratuity for being wealthy enough that you're never forced to buy or sell.
An aside is that this rate was set in one context by currency and convention: an English pound was 20 shillings, and a guinea was 21. So when you won an auction, you would pay the auction house in guineas, and the auction house would pay the owner of the item in pounds, giving a 4.75% share to the house. Racehorses are still sold this way, although aren't any guineas or shillings any more, it's now 1£ and 1.05£.
it's not a gift (implying it's free).
Owning capital has a cost - the cost of capital (aka, the cost of money). At minimum, the cost is the risk free interest rate.
The owner paid a pretty penny (or borrowed, at a higher than risk-free rate) to buy the property. The previous seller did the same, or invested capital in building the property itself. So therefore, "owning a house" is the last chain in a sequence of investments, all of which costs money.