Subj : Re: New to this
To   : StormTrooper
From : boraxman
Date : Sun Apr 20 2025 21:11:32

On 20 Apr 2025 at 08:41a, StormTrooper pondered and said...
 
 St>  bo> The ONLY solution is for prices to fall.  No major party here, no par
 St>  bo> actually, would allow that to happen.  Therefore the problem won't ge
 St>  bo> fixed, and young people may as well just give up and fritter away the
 St>  bo> money.
 St> 
 St> Can you imagine the deflationary fallout if we had property prices drop?
 St> For older people, read whats left of Boomers here, you need ~75% the
 St> value of a house to afford the deposit for aged care.  
 St> 
 St> My mother, pain that she is, moved into a facility must be about 10 years
 St> ago... I've moved her twice in that time, when she first decided the one
 St> she was in was hell, and then after about 9months the alternative was a
 St> lower level of hell and decided to go back to the first one.  The
 St> deposit has climbed from 500k to over 650k now.... don't know to many
 St> oldies with that kind of cash balance, only asset tends to end up being
 St> their home.
 St> 
 St> You'd also have a bunch of current loan holders that end up with
 St> significantly less value in their purchase than the original loan, it'd
 St> turn the home into a millstone. You'd never be able to move from the one
 St> you've got if you're lucky enough to have one.
 St> 
 St> At the same time you're right what we have now is unsustainable. 
 St> Somewhere along the line there's going to be a lot of pain to straighten
 St> it out.
 St> 

It would be awful yes, but it could have been avoided if it were not allowed to fester for so long.  Its either prices fall, or family formation falls down causing a demographic collapse.  Thats worse than a temporary financial crisis.  We're seeing this already.  We can recover from a fall in prices, but a demographic shift will have far reaching, long term consequences.  The choice is clear.  The sooner it bursts, the better.  

There is no good way out.  Lesson is, don't borrow from the future if you don't want to pay the price later.

--- Mystic BBS v1.12 A48 (Linux/64)
 * Origin: Agency BBS | Dunedin, New Zealand | agency.bbs.nz (21:1/101)

.