It’s been almost 100 years since the reform of non-recourse mortgages. I wonder how home prices would be different if you could never escape the liability.
My strong hunch is that many inherited houses will be sold in distress.
The biggest hurdle is the fact that house more likely is a liability not an asset. Second, is the liability mismatching, we will take a mortgage last 30 years against a job can fire you this Friday, and a job market full of fake job listings, most jobs are hiring applicants that are not able to differentiate their strength by a lot, thus, there is a limit how much more you can get paid, and makes it hard for you to get your foot into the door in absence of a labor shortage.
Also, cycles and trends matters. US population is aging, BOJ wants to get its money back. At this particular point to buy a house feels more like a future regret than a jackpot.
In 2024, I saw so many people crying on Tiktok how their mortgage payment had doubled since 2020. It turns out their insurance and property tax has skyrocketed.