if a new house cost 300,000$ now,why alow your children to pay 1million for the same house when they are older

Question

cost of living

Answer 1

Inflation

Answer 2

I am not sure I understand your question.

If you have $300,000 today, the best way to invest may not be to pay the full balance on the house. It may be better to take a loan (mortgage) and instead invest the money elsewhere.

For example, if your mortgage has a 5% interest rate, but you can invest the money for a 7% return, then your best option is to take the largest loan you can on the mortgage and invest the money, and thus you get a 2% return (after taxes). It is not this simple, but it is a key reason that most people do not pay off their home loans. (Same with cars, especially when the loan interest is so darn low.)

This is not an inflation issue. A dollar today will be worth more tomorrow (if you invest it). For example, put a dollar in the bank at 4% interest, and calculate how much you get in 20 years...

Answer 3

Million today will be the 300,000 equivalent of tomorrow, it's a balancing act and sometimes the type-rope walker can fall. The pay wages of today will inflate at the same rate that all other prices will so there is not much to worry about.

According to a pdf I found

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"The Fed combats inflation by increasing the interest rate. An increase in the interest rate increases the opportunity cost of investment. Investment spending drops which reduces output. Unemployment rises."
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In other words if you're able to keep your job period you got it made.The idea here is to get the job with X company when it is starting that way if it does well they are less likely to give you the boot.

Now if there is a Holocaust, Occupation or Apocalypse then houses would probably be worth more and be extremely hard to come by then yes the prices would be unreachable. Highly unlikely :))

Answer 4

It's called Inflation

Answer 5

That's about in line with fifty years mortgages are on the horizon;comming to a city near you.

Answer 6

The increase in the market value of that property.