You have seen throughout your life that the housing prices had never fallen down, rather, it has always been on a growing slope specially in large cities. So, today we want to talk about the reasons and the ways to solve this issue and to avoid the inflationary prices. The idea is that economists are hesitant against inflation as it is an indication of a weak economic performance and a low value of money. The inconsistency that we see in the supply of housing and the rising housing prices is nonetheless relevant to the banking strategies. Throughout the history banks had tried to ease the purchase of houses for people by lending money. In the conventional format, as it's called property investment portfolio, the bank charges interest rate on the money lent; currently about 3%. This means that if you decide to buy a house at a market price of let’s say 500,000 in Sydney metro, by the end of the mortgage terms you have to pay back $515,000. Now according to the Australian Bureau of Statistics, the wages growth rate was about 1.8% in June 2020 which is a downward trend since 1998 from about 3% to now 1.8%. What it means is that a typical employee of the government cannot simply afford to pay back the mortgage by a margin of 1.2%.

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