House prices will fall if interest rates rise, right?
It is natural for house prices to fall when interest rates rise. But will interest rates keep rising indefinitely? Self-employed business owners will collapse before that happens. Ultimately, there is a limit to how much interest rates can be raised. House prices will fall in the short term. However, simply injecting money increases the money supply, which naturally causes the value of currency to decrease. Does the price of Jajangmyeon fall just because the population decreases? Furthermore, the concentration of the population in the Seoul metropolitan area will only intensify over time. House prices will rise and then fall. But will they fall as much as they rose? If you are betting on a decline in Seoul house prices, it might be manageable if you take a short position for a brief period, but what happens if you hold a short position for the long term? Are you really planning to bet on a decline in house prices amidst Seoul's gentrification and declining population?
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