House buyers – both investors and live-in buyers – could borrow a lot more money with the same payment in 2020 and 2021, so naturally, over time, they bid up house prices.
With historically low mortgage rates and houses appreciating $100,000 in one year in some cities, investors were, naturally, buying a lot more investment houses.
Then, after house prices had been skyrocketing for a while, both investors and live-in home buyers expected prices to continue skyrocketing so they continued to bid up house prices long after mortgage rates stopped falling.
But by October 2023, you could only borrow 25% LESS money to buy a house than you could in November 2018 with the exact same monthly principal and interest mortgage payment.
76 Secrets of U.S. Home Ownership – Table of Contents