Zerodha's Nikhil Kamath on rising EMIs, house prices, and what lies ahead…
infographics on the housing crisis. "So, rates are up, EMIs have doubled, salaries haven't, and house prices have gone up a lot. What’s next?" Kamath wrote in a post on November 2.
He added: "If rates stay up, the slowdown in sales could be a logical precursor to price correction. The cost of capital is correlated globally, Indian rates can't go down if the US rates stay up..." Kamath also attached infographics made by InvestyWise to support his points. This isn't the first time he's used their infographics to make a point.
InvestyWise claims to "elevate financial education with engaging, shareable infographics". These particular ones had data sourced from various experts and agencies such as Standard & Poor, Freddie Mac, the US Fed, RedFin, and the National Association of Realtors. The post was largely about the US housing market crisis, where astronomical price hikes have made buying a house impossible for a majority of youth.
As per a Wall Street Journal report last month, it is now 52 percent more expensive to buy a home than to rent one because of climbing mortgage rates. Also Read: There has never been a worse time to buy instead of rent Earlier in April, Kamath had called the “sudden spike" in house rents in India a short-term phenomenon, adding that if the stark mismatch between the trend of buying and renting houses needed to reach an equilibrium, and that he would bet on the former. “Looks like a short-term phenomenon; as long as you can #rent at 3 percent and #housing loan rates are over 8 percent, this won't work.
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