You have a fair point. Folks who bought with a 2% mortgage will not have incentive to sell. Historically low interest rates were used to stimulate the economy, then the government prevented evictions which meant that roughly 5% of the housing market that is typically in rotation no longer was; further restricting supply.

At some point foreclosures and evictions will need to return and when that happens you will have several years of pent up inventory hitting the market at likely the same time. It is also possible that this will coincide with the rise of unemployment, which is also at historical lows and at some point will return to a more normal rate.

Despite the fact that there is incentive for some with a 2% mortgage to stay put; life will continue. The elderly will die, people will be promoted and relocated, and empty nesters will downsize. Nothing is permanent, just like the fact that in the 1970s mortgage rates exceeded 10%. BITD the opposite thing was being said and folks were saying that people will never be able to buy a home because of the insanely high interest rates and the impact that had on the mortgage payment.

People complain about the economy right now. There is reason to do so; but just wait until the unemployment rate rate spikes and finding a job is more difficult. The amount of housing supply will increase, but those who will qualify for a mortgage will decrease and a portion of the population will remember the good old days of high employment, despite the increase in prices.

The key take aways, especially for young people, is that nothing is permanent. Save your money now, and pounce when the economic changes occur. Buy when the inventory returns. When the interest rates eventually fall, refinance. Just because this isnwhatnhas happened during your early adulthood doesn't mean that the world won't continue to find equilibrium to a state that you have yet to experience.

Never this, never that. Rome didn't fall in a day or whatever. Speaking in absolutes in foolish.

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