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I think 3.75-4.00% would be a reasonable rate. If we want to keep inflation at 2%, the interest rate should be a little higher. This would also incentivize saving, which I think is a generally healthy habit in society
I think the happy medium is where the markets find it.
The fed is an integral part of the free markets.
The beloved r* will forever be a mystery
2-4% with unemployment around 4% and gdp between 2-3% inflation 2-3%
Which of the many r? Mortgage 30yr? 4.5-5.5%. Fed Policy? 4-4.5%
Dream On with the 2% to 4%. If that happens again it’s because we are in trouble as a nation. 5% to 6% is more realistic. I lean more towards the 6% to happen.
When my SO and I graduated college in 2003, it was 5.5%. We bought a $285k small 2bd/2ba condo outside Washington DC. We were 23 yrs old. We had student loans and no down payment help. We were only able to put 5% down payment. You have to start your ownership journey somewhere! Through the years, and the 2008 crisis, we bought a townhouse and a full sized house. It takes time, patience, money management. It will happen for you!