not going to happen.All I want for Christmas is a .25 rate hike today.
Truth be told we need strong medicine
I am glad someone somewhere is pointing this out. The cost of a mortgage alone is enough to make most people feel badly about the economy no matter how objectively good it is in other ways. Homeowners who bought a house and got a 3% rate are in good shape but feel like they can’t move even if they want to. Renters who want to buy their first home feel left behind and hopeless (so most people under 35).Blame the Fed’s inflation fighting for why Americans are miserable about the economy, according to Larry Summers (and a bunch of other top economists)
"If the pre-1983 formula were still in use today, the CPI would have shown inflation climbing even higher in 2022 — to around 15% rather than 9.1% — and inflation would not have fallen as fast in 2023"
Hey, I pointed it out. But then, I am not someone of importance.I am glad someone somewhere is pointing this out.
Eh... I was already feeling left behind before mortgage rates rose thanks to the limited housing supply in the area, unless I wanted to shell out $600k+ for a single floor fixer-upper in a 120 year-old triple-decker fire trap built to the fantastic fire codes of 1904.I am glad someone somewhere is pointing this out. The cost of a mortgage alone is enough to make most people feel badly about the economy no matter how objectively good it is in other ways. Homeowners who bought a house and got a 3% rate are in good shape but feel like they can’t move even if they want to. Renters who want to buy their first home feel left behind and hopeless (so most people under 35).
Well that is true, but our region is a bit of a special case being one of the most expensive markets in the country. The $600k minimum price tag for a place that may or may not suck was shitty but at least manageable when rates were low. Save up a chunk of change and then pay $3k per month or about the same as rent, but ~half goes to equity at least. Now it’s $800-900k for the same place and the payment is $6-7000. That’s what people see and it sucks far worse than it did before.Eh... I was already feeling left behind before mortgage rates rose thanks to the limited housing supply in the area, unless I wanted to shell out $600k+ for a single floor fixer-upper in a 120 year-old triple-decker fire trap built to the fantastic fire codes of 1904.
Fortunately for me, I get to rent for the foreseeable future thanks to life circumstances making it impractical to buy.
Well that is true, but our region is a bit of a special case being one of the most expensive markets in the country. The $600k minimum price tag for a place that may or may not suck was shitty but at least manageable when rates were low. Save up a chunk of change and then pay $3k per month or about the same as rent, but ~half goes to equity at least. Now it’s $800-900k for the same place and the payment is $6-7000. That’s what people see and it sucks far worse than it did before.
Not really the point. When I bought my place in 2019 it was a tough market (12 offers on my house) but there was plenty of places changing hands. Now it’s rare that a house even comes up for sale in my neighborhood of Boston, which is the whole reason prices have stayed high. I think pricing keeps going up over time because we don’t build enough but lower rates won’t blow it up like you think because it will also ease the supply/demand curve.Well.. if 7% mortgage rates didn't deter people to the point where prices started to fall, you can only imagine what will happen once rates do.
Yea that's one of the side effects of the rising rates. When you're in a house with sub-4% rate, it's hard to justify a move to a new place with 7%. Then there's also the issue with population growth around cities while home building is barley crawling up in these areas.Not really the point. When I bought my place in 2019 it was a tough market (12 offers on my house) but there was plenty of places changing hands. Now it’s rare that a house even comes up for sale in my neighborhood of Boston, which is the whole reason prices have stayed high. I think pricing keeps going up over time because we don’t build enough but lower rates won’t blow it up like you think because it will also ease the supply/demand curve.
Hey, I pointed it out. But then, I am not someone of importance.
Why? Which market constrains do you see?I am expecting inflation to reignite once they start cutting rates... unless there's mass white collar unemployment to go with it.
because it will also ease the supply/demand curve.
Imagine how high it could be if you didn’t live in a communist country!And now +8.97%
I'm just happy that we all live in global capitalism, as my vast majority is in US stocks as I have three global index funds, one US, one EU and one DK, and the global contains lots of US stocks.Imagine how high it could be if you didn’t live in a communist country!