House Prices?

Question

Is it better for the economy if house prices go up or down?

Just a thought as heard a debate on the radio this afternoon. Very mixed answers.

Answer 1

Depends on who you are, if your a homeowner, then up is better! If your an investor in properties you want to buy houses at the cheapest possible price so down is better.

Answer 2

Stability is best for the majority, by that I mean slowly climbing prices at the same rate as overall inflation if under 3%. But Capitalism is nothing if not volatile, as w. stock markets bubbles are created and burst regularly in cycles, the very rich pull their money out at the right moment increasing their fortunes while everyone else contributes to the pot they get. Those who are panicked into buying at the last moment (the relatively poor) invariably loose the most, then the cycle starts over again.

Answer 3

Down right now price are to out of whack and the market is not a honest market is is going to crash. Hear is how they made the bubble.
http://www.breakingbubble.com/index.htm

Also to much of the economy is tie to housing and does not give people the disposable incomes to develop other markets and increase the standard of living even more.

Answer 4

If the go up it is better for the economy, becasue depending on the price of the house will determine the amount of interest they get.

Answer 5

The best thing for the economy is a slow controlled inflation rate. When anything goes up 30% in a year it means something is out of balance and cannot last.

Answer 6

If you are a home owner, this question is annoying. If you are aspirant to becoming a home owner, you would favor a fall in prices. The 'mixed' answers you heard makes sense.

Answer 7

It's probably better if they rise sloooowly or not at all. Falling would be bad as so many people have borrowed against the increased value of their house - and suddenly the house could be worthless than they have borrowed......

Answer 8

up up up baby