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Two factors: supply and demand
Supply:
- increased supply of financing or credit. Low interest rates and relatively loose terms mean consumers can “afford” high prices
- decreased slack in housing inventory. Said another way, the housing market is tight because new home construction has not kept up with population growth.
Demand:
- babies keep being born every year. This combined with immigration and subtracting out the death rate, means more people need places to live.
These three forces create upward support on house prices. The forces described above can be supported with publicly available data, should one care do so.
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