52 sats \ 2 replies \ @k00b 2 Jun \ on: Stuck in a Starter Home econ
I’ve been impressed by how unaware/forgetful we are wrt interest rates. The financial crevice the first family is caught in is entirely the result of interest rates. A $1m home is a doable upgrade when you’ve just sold a $700k home, but going from a 30 year mortgage at 2.25% to 7% even on the same home would make it unaffordable.
Assuming the same home stays at the same price, of course.
It seems like prices are adjusting really slowly to the higher interest rates, but that's mostly because the price change (demand shift) is manifesting in reduced sales volume.