A wife of a good friend of mine went shopping recently for a new car. She's 28. Her budget was around the 25k mark she bought a 42k SUV. Because she could.
She and her husband earn 120k a year between them with two kids the same as most people in her age bracket that are renting.
The person renting in her situation doesn't buy that car because she does not have access to the giant line of credit housing has provided her. She would have to get personal loan at 12% instead of dropping it on the mortgage at 6. All of a sudden it's no so attractive or viable.
A false economy that rising home prices have created.
Take Harvey Norman for example. Sells Chinese made junk at crazy prices thanks to its well marketed interest free payment system. How many folks walk in there and drop 10k on rubbish when they buy a new house without even blinking.
No one fears debt anymore they just handball it around.
