30-year mortgage rates are near 8% with excellent credit. Interest rates have climbed for the past three months straight. The Fed is considering another interest rate increase for November and December, possibly pushing rates up to 8.5% or even 9%. The reasoning is that higher interest rates will "slow down inflation".
Home sales are at a 13-year low. Factor in the higher cost of insurance and the fact that property taxes are going up to unaffordable levels and the very high cost of labor and materials for home construction... and you have a real estate market that's going to crater.
I personally know several homeowners that had their homes listed for sale, but have removed them from the market in the past 2 months. They will wait and hold on to what they have for now. One real estate agent mentioned to a couple that they should keep their house off the market until at least middle of next year and then decide based on market conditions.
I'm suggesting that the U.S. economy is a three legged stool... and one of those legs is housing and private & commercial real estate. If it fails, the economy goes into a deep recession at best.
Our fiat money system is near an end.
correct and overall it's a net positive, but one does have to wonder if the people who have saved cash for their whole life are simply going to be left out to dry.
Yes and no. Technically people that have saved cash over the last 20 years have lost of 50% of that value, likely 70%. It's hard to calculate because of the unevenness of supply and demand, improved technologies along with inflation. They should have diversified some of their savings with gold and silver as a hedge.
Savers always get raped because redistribution of wealth will say that they are too rich and need to share it with everyone else (not you or me, of course, we don't count.)
The value of their money is rapidly dropping to zero. Honestly thinknits there now.