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So would every tax payer see a 20% increase? No. Would every homeowner see a 20% increase? No. Would every mortgage holder see a 20% increase? No. Would a majority of the three groups see a 20% increase? No. So again please outline your basis for a 20% net interest increase
The math is obvious except to those who for whatever reason aren't even trying.
Are you claiming now that an increase in first year net interest payment of 20% or so would be INSIGNIFICANT to potential buyers?
Every response is a question with you. What I'm saying is that the pool of potential buyers for a $1.2 million house would not be significantly reduced as a result of the proposed tax law change.
The math is obvious except to those who for whatever reason aren't even trying.
The math isn't that obvious because you have yet in this thread been able to substantiate anything you've asserted. Nothing. You are just rattling off your opinion as fact and you can't back it up.
many teaser rates were higher than todays fixed. in the end you would be hard pressed to show any credible study that shows until rates get very high that there is any direct correlation to home prices at any point in time
The point is that the teaser rates were much lower than the prevailing market rate in 2006 and 2007. Otherwise, there is no point in marketing those loans to borrowers.
Long-term interest rates were extremely stable during that bubble.
Today's rate is artificially engineered to be lower than in 2006. Instead of capping interest rates during an economic cycle , the policy in many countries was to push them down to zero or below.
There is a presumption in financial economics that an inverse relationship exists between interest rates and asset prices. People do not tend to invest scarce research funds in studying what is thought to be obvious to begin with.
that would be a false presumption as higher rates mean the economy is humming along nicely . it is only when rates exceeded 9% that assets took a bit of a hit . in fact it has never been the amount of the rise within reason , it is the speed of the rise that determines the outcome more often . slow rate increases have had little effect on asset prices .
rates by themselves mean nothing , it is the bigger picture that includes a whole lot more that determines what happens to values .
Last edited by mathjak107; 11-19-2017 at 10:42 AM..
You'd think with he and his wife spending so much time over the course of years helping folks prepare tax returns and their IRS seminars they attended
That would be a reasonable assumption
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