We have to consider what that inflation looks like, and which sectors it did or didn’t affect. If inflation comes from credit, there is an equal amount of debt + interest that has to be paid back in the future. If there is literal “money printing” with no debt offset, we have to consider the different areas that money would have gone to because it doesn’t necessarily have to be spent in a proportional way.
Housing is largely affected by credit, and it afford the greatest number of people to leverage the greatest amount of money possible. Because of this, a credit expansion can cause housing prices to rise without a commensurate increase in wages.
Also, inflation may have caused the prices of other basic goods to rise to such an extent that there is less money left over for housing.
If we look at the history of housing prices you’ll see that the some of the greatest price increases happened in the 70s. I think this is largely due to two things: a fairly sudden increase in dual-income households, along with the movement of the Baby Boomers into their peak home buying years.
Still want to continue this, but have to run and pick up the kids. Will be back. 🙂
