Or to put it another way, why didnt it happen 20 years ago or 50 years ago or 100 years ago? It seems like the underlying reasons for property being so expensive have been around, well, forever? Landlords accumulate wealth, buy property, use property to generate more wealth, property stock declines and property prices go up? I realise thats a 5 year old’s view of capitolism but i dont have any background in economics. Id love to have it explained in more detail
In: Economics
There have been affordability crises in the past. In the 70s-80s interest rates were above 10%, and housing affordability was very low. The difference was that homes were smaller and young people planned to buy several homes over time so they were willing to buy a “starter house” with very few features.
When nobody wants to buy what’s cheap to build, all builders build expensive houses.
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