However, it’s possible conditions could be significantly different going forward, which could be cause for pause currently. The last 15 years have been a period of generally easing financial conditions, including multiple years of massively loose financial conditions and significant liquidity. 2019-2020 also may have been the tail end of a decades-long cycle of declining interest rates. Good times to buy. Those conditions are excellent for asset price increases (particularly equity building) and move ups on the property ladder.

We may now be looking at 7-10+ years of tightening, and possibly the start of another climb in the interest rate cycle (particularly if the long end of the yield curve comes unanchored from 2% inflation expectations for any reason), and neither of those scenarios are particularly favorable for asset price increases or equity building.

In the long run, housing has always tended to go up, and it’s possible that could continue. However, we’re at a crossroads with effects from unprecedented monetary policy that could have some fairly long lingering effects. It’s possible it could disrupt that trend in the short term (10-15 years) depending on the outcome.