As the article states, this isn't indicative of monetary inflation, rather it's a supply and demand issue. I do find myself wondering about the influence of on housing prices of some desire to secure low fixed-rate mortgages while they last.
That said, in case this made it on the board as part of the recent inflation meme, I'll mention that it does seem to me that most evidence used to support the inflation story isn't really about monetary inflation, from chips to bikes to houses to used cars to copper and even labor prices, and the economists who aren't afraid of inflation seem to me to have the better arguments this time. I might have some bias after 2008-9 when a similar chorus of inflation hawks was singing doom, that time during a deflationary event (they claimed the Fed would overprint). Anyway I'm not able to get scared of inflation at this point, but would love to hear thoughtful counter-opinions.
> That left the housing market with a serious shortage of homes, just as millennials have begun getting married and having kids — traditional hallmarks of home-buying interest.
That works only as long as the new generation is money to buy a home from the older generation. I do not know too much about the situation in the US, but in the UK for many young people new in the workforce, buying a house is not affordable any more, and the future might see a large number of aged sellers facing a shrinking number of young buyers which, due to shrinking real wages, can pay less and less while mortgages rise.
In other European countries, the situation might be even more complicated, since real estate might have become a substitute for forms of money like treasuries, in other words it might have become a form of money and this might have become much stronger coupled to inflation than it was in the past.
I hope so, the millennial generation was already struggling with buying a home before COVID.
We need another market correction to tamper off speculators and allow millennials to owe a home; after all, they are the future (and a better investment overall).
That said, in case this made it on the board as part of the recent inflation meme, I'll mention that it does seem to me that most evidence used to support the inflation story isn't really about monetary inflation, from chips to bikes to houses to used cars to copper and even labor prices, and the economists who aren't afraid of inflation seem to me to have the better arguments this time. I might have some bias after 2008-9 when a similar chorus of inflation hawks was singing doom, that time during a deflationary event (they claimed the Fed would overprint). Anyway I'm not able to get scared of inflation at this point, but would love to hear thoughtful counter-opinions.