Re:“People simply empty out”
by scotty79 on Friday August 16, 2013 @05:11AM
(#6222948)
Like you said "bubble". So it's not "going down like crazy" it just readjusts to level closer to sane price.
And that reduced demand doesn't come from people needing less real estate to live. Just from the fact that real estate reached prices that most people can't afford even if they pay with slaving their whole life for mortgage.
Reasonable price for apartment would be what most people could save up during the time they still live with their parents. But since real estate backed credit is legal that's not gonna happen. Such credit allows people to sell their future work in a manner almost perfectly safe for the bank. Thanks to this since you need place to live to have a life it can cost huge part of what you earn in life.
And that reduced demand doesn't come from people needing less real estate to live. Just from the fact that real estate reached prices that most people can't afford even if they pay with slaving their whole life for mortgage.
Reasonable price for apartment would be what most people could save up during the time they still live with their parents. But since real estate backed credit is legal that's not gonna happen. Such credit allows people to sell their future work in a manner almost perfectly safe for the bank. Thanks to this since you need place to live to have a life it can cost huge part of what you earn in life.