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In response to
"I think it has the added benefit of helping real estate find its floor faster."
by
Loyola
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when you flood the market with free money, all it does is knock prices up in the short term.
Posted by
mafic
Oct 18 '10, 15:47
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there was a first homeowner's grant of $21,000 in Australia for a while. it made it easier for people to get mortgages, 'cause hey, instant $21,000 down payment, but it also increased real estate prices across the board by about the same amount. if everyone knows the money is available, everyone wants it. if the guy buying your house also got a 30% cheque from the government, you bump your house price up to account for that.
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Responses:
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