- This topic has 20 replies, 6 voices, and was last updated 17 years ago by
one_muggle.
-
AuthorPosts
-
November 7, 2007 at 7:35 PM #97197November 7, 2007 at 7:35 PM #97205
drunkle
Participantwell, if artificially high home prices are supported, then the higher rents are also justified…
November 8, 2007 at 12:22 AM #97226one_muggle
ParticipantIf you include all government intervention, then prices were already artificially high, even before the bubble. The tax deduction for mortgages already juiced housing prices, since it makes a given mortgage cheaper. As people compete for houses, the discount is, well, discounted. If you want to argue that this isn’t the case, imagine what would happen to house prices-all other things being equal– if the deduction were taken away.
I think that deduction has a bigger influence on prices, than does this collection of bailouts. Sure, the individuals that get bailed out will make out like bandits, but it doesn’t look like the scale will affect the market much, at least not yet.
-one muggle
November 8, 2007 at 12:22 AM #97287ParticipantIf you include all government intervention, then prices were already artificially high, even before the bubble. The tax deduction for mortgages already juiced housing prices, since it makes a given mortgage cheaper. As people compete for houses, the discount is, well, discounted. If you want to argue that this isn’t the case, imagine what would happen to house prices-all other things being equal– if the deduction were taken away.
I think that deduction has a bigger influence on prices, than does this collection of bailouts. Sure, the individuals that get bailed out will make out like bandits, but it doesn’t look like the scale will affect the market much, at least not yet.
-one muggle
November 8, 2007 at 12:22 AM #97297ParticipantIf you include all government intervention, then prices were already artificially high, even before the bubble. The tax deduction for mortgages already juiced housing prices, since it makes a given mortgage cheaper. As people compete for houses, the discount is, well, discounted. If you want to argue that this isn’t the case, imagine what would happen to house prices-all other things being equal– if the deduction were taken away.
I think that deduction has a bigger influence on prices, than does this collection of bailouts. Sure, the individuals that get bailed out will make out like bandits, but it doesn’t look like the scale will affect the market much, at least not yet.
-one muggle
November 8, 2007 at 12:22 AM #97306ParticipantIf you include all government intervention, then prices were already artificially high, even before the bubble. The tax deduction for mortgages already juiced housing prices, since it makes a given mortgage cheaper. As people compete for houses, the discount is, well, discounted. If you want to argue that this isn’t the case, imagine what would happen to house prices-all other things being equal– if the deduction were taken away.
I think that deduction has a bigger influence on prices, than does this collection of bailouts. Sure, the individuals that get bailed out will make out like bandits, but it doesn’t look like the scale will affect the market much, at least not yet.
-one muggle
-
AuthorPosts
- You must be logged in to reply to this topic.