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Comment by aszantu | Hacker News Reader

what does that mean for poor people, does someone know? Can someone explain?

Poor people are screwed up regardless -- if rates are high, they can't afford payments, if rates are low, prices rise and they still can't afford payments. Not to mention getting downpayment.

Workaround: don't be poor.

The down payment is the hardest part. "Just barely able to make payments" people are better off when rates are high because that depresses prices resulting in a lesser dollar amount for whatever the down-payment is.

I don't know how to be not poor :| applying for jobs but takes time to get one

Do rising prices spur the construction of more homes in Denmark?

Seems pretty steady:

https://i.imgur.com/wF6PCnU.png

2019 is not over yet, so maybe it's a little higher this year.

This is only for "parcelhuse", which wikipedia defines as: "Single-family detached home".

Homes come in a lot of shapes and sizes though - in Italy where I lived for a number of years, it's pretty common for people to live in a flat in a 4/6/8/whatever unit building, either as owners or renters.

Depending on where demand is, I'd expect more of that sort of thing too, if it's allowed. In the US, it is forbidden to build those kinds of homes in large areas of our cities.

https://i.imgur.com/2iCJllW.png

Here is the graph for multistorey apartment buildings. I'm not smart enough to interpret what this means. In the big city I live in in Denmark, most new apartment buildings are luxury apartments and expensive as hell, so I don't think they are a result of rising house prices.

In general, new construction is expensive, but if you cut off that supply, people with money just bid up prices on older housing.

Looks like the graph kicked up in response to something... that's good, I guess.

For poor people it means that your rent continues to rise, house prices become further inflated and you will still pay massive interest rates if you get a consumer loan.

In Denmark the rents are not free market so they can't just rise with house prices.

What can they rise with? Some official inflation rate? Does the calculation of that inflation rate include house prices?

There are some details here: http://www.rentingindenmark.com/prices-and-rent/

There is no rent control for buildings built after 1993.

There is not strict rent control but that does not mean that the landlord can increase the rent as he sees fit.

Poor people don't always have the means to save to afford the 10-30% down payment, so they cannot benefit from the cheap mortgage rates.

On the other hand, the banks are basically transferring wealth to the middle class (or anyone who can afford a mortgage) by paying them to borrow money.

In Denmark the required downpayment is 5%, up from 0 a few years ago.

Same in the US effectively. You will have to pay extra for mortgage insurance but I think the 20% notion is long dead.

House prices will remain artificially high so they won't be able to afford one.

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