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Old 09-20-2018, 09:53 AM
 
14,648 posts, read 3,883,622 times
Reputation: 10671

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This is of little concern to me (in fact, it's a positive since I am more often on the lending side), but I can't help but wonder how it hits the forgotten man and woman. Stable wages....at most up 1%, yet fuel up 10-20% and interest rates up 30-60%.

I can't imagine a lot of "free income" showing up in the bank accounts of the masses.
https://www.cnbc.com/2018/09/19/week...ions-rise.html

As it stands, the housing market in many areas has barely recovered (if that!) from the Great Recession, now this means the average person can afford less...

It looks like the Citibank Plutonomy memo is more true than ever. There is "us" and then there are the rest (most people!).....
https://delong.typepad.com/plutonomy-1.pdf
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Old 09-20-2018, 10:05 AM
 
Location: Cape Cod
11,649 posts, read 8,163,045 times
Reputation: 20129
I own a real estate company and rising rates are a concern but we sell to mostly a second home market.

The people that are hurt by this are the younger first time buyers that are trying to stay in an area they love but is increasingly harder to afford.



The rising rates are more like a market correction from the artificially low interest rates we have been enjoying for several years now.
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Old 09-20-2018, 10:05 AM
 
Location: Divided Tribes of America
13,545 posts, read 5,461,878 times
Reputation: 5298
Blind partisanship.

When the economy improves, interest rates are supposed to go up to prevent inflation. That’s normal Fed policy.
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Old 09-20-2018, 10:08 AM
 
Location: Barrington
45,613 posts, read 33,883,136 times
Reputation: 15184
I carried a 16.5% mortgage on my first house.

The monthly P&I payment on that same property today is less than what I was paying 37 years ago, despite the market value increasing 4- fold.
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Old 09-20-2018, 10:11 AM
 
Location: Just over the horizon
7,997 posts, read 2,745,540 times
Reputation: 4287
Maybe more people will stop buying homes they can't afford now.....
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Old 09-20-2018, 10:16 AM
 
4,357 posts, read 811,012 times
Reputation: 1796
Quote:
Originally Posted by kenth View Post
This is an early sign that we are entering a period of stagflation. Wages are flat, interest rates are going up and prices on consumer goods continue to rise. Add the impact of Trump's tariffs which will function like an additional sales tax on almost everything that Americans purchase and we could be in for a rough ride. The tax cuts for the rich were the perfect catalyst to increase the money supply which is really what sets this off.
Increase who s money supply?
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Old 09-20-2018, 10:24 AM
 
6,902 posts, read 1,737,000 times
Reputation: 4038
Quote:
Originally Posted by FatBob96 View Post
Maybe more people will stop buying homes they can't afford now.....
The will still do that however they will get a lesser house for the same amount of money.
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Old 09-20-2018, 10:25 AM
Noc
 
1,439 posts, read 1,802,022 times
Reputation: 612
6% is getting up there especially at today selling prices. If that trend continues it means houses will be on the market longer and sellers would be forced to lower prices.
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Old 09-20-2018, 10:26 AM
 
Location: Charleston, SC
4,855 posts, read 3,635,261 times
Reputation: 3917
Quote:
Originally Posted by craigiri View Post
This is of little concern to me (in fact, it's a positive since I am more often on the lending side), but I can't help but wonder how it hits the forgotten man and woman. Stable wages....at most up 1%, yet fuel up 10-20% and interest rates up 30-60%.

I can't imagine a lot of "free income" showing up in the bank accounts of the masses.
https://www.cnbc.com/2018/09/19/week...ions-rise.html

As it stands, the housing market in many areas has barely recovered (if that!) from the Great Recession, now this means the average person can afford less...

It looks like the Citibank Plutonomy memo is more true than ever. There is "us" and then there are the rest (most people!).....
https://delong.typepad.com/plutonomy-1.pdf
A good enough reason to save up your money until the flow starts again. Every six years or so we see an ebb and flow in the market, right now is the beginning of the ebb....
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Old 09-20-2018, 10:36 AM
 
3,119 posts, read 1,258,965 times
Reputation: 2919
Quote:
Originally Posted by middle-aged mom View Post
I carried a 16.5% mortgage on my first house.

The monthly P&I payment on that same property today is less than what I was paying 37 years ago, despite the market value increasing 4- fold.
My second home was mortgaged at 17%, late 70's. I loved the high interest rate because I was single and I rented out rooms to local college students, so my monthly out of pocket cost was less than zero and I got the advantage of a great tax write off. At the time, my payments were more than my income, I had to get a "Liar Loan" to qualify. Those are no longer available in this day and age.

OK, I confess, I enjoyed the benefit of the write off, and never declared the income. Young guys paying cash every month. I was very young, I got smarted and did things more on the up and up as time went by.
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