High Housing Prices

[amegreerb]

[antoinettesv16]

Do house/apartment prices seem to keep going up? Let's talk about it in this thread.

The problem may be that more investors are putting their money into real estate than stocks. This is the result of negative interest rates. Investors "interpret such extreme policy as a sign of crisis with no predictable outcome" (http://www.bloomberg.com/news/artic...ative-rate-experiment-shows-perversions-ahead (http://www.bloomberg.com/news/articles/2016-05-01/world-s-longest-negative-rate-experiment-shows-perversions-ahead)) And at the same time they see low borrowing rates, so buy a 2nd (3rd, 4th, etc) house.

There was the canard that real estate always goes up (when I type "real es" into my Google search, it fills out the rest). I mean sure it went down in 2008, but that just means it needs to get back up now.

[Annaea]

It's certainly true that housing prices are rising not just because of negative interest rates. But those rates have driven more buyers into real estate, and when the supply in a locale is not increased then you see some price explosions. So if governments want to keep negative rates, should they be forced to take responsibility and increase supply?

[aravawo]

It's funny how true this is. Well not funny, but you get the idea. I've been telling my wife that if we decide to have kids, if the college situation is still the same it is today, I don't even know if I'd encourage my child to go, or if I would just suggest to them to develop some sort of specialized skill (mechanic, construction, carpentry, etc.) on their own and get a job doing that.

So many kids these days don't get jobs out of college and pay it off for decades.

[AOi]

I just wonder how housing prices can go up when so many of the up and coming buyers are already strapped with huge debts and with interest rates having to ramp up......prices have to fall, right?