"Income cannot keep up with the rise in housing prices, so there is a real estate bubble, and sooner or later the bubble will burst. Hmm, let's wait and see."
"Real estate investment is about making money. If there is no positive cash flow, there is no need to invest in real estate."
"The debt is 180% of a household's disposable income. If the debt burden is too heavy, housing prices will plummet."
“House prices are driven up by speculators, and cracking down on speculators will bring down house prices.”
"As long as I have my own house, it's fine. If I don't participate in real estate investment, there is no risk of losing money. If there is no buying and selling, there is no harm."
"Internet technology will reduce the need for people to live together, so no one will live in houses in big cities anymore, and house prices in big cities will fall sooner or later."
“In the development of the national economy, real estate accounts for too large a share, squeezing out resources for the development of other industries and affecting economic development.”
"Real estate investment is immoral. You bought so many houses and pushed up housing prices. Young people can't afford houses and will flee big cities. Real estate investment will harm our children and grandchildren."
“Real estate investing is too illiquid.”
“The value of pre-construction properties increases faster than that of second-hand houses.”
"Interest rates are going up, so house prices are going to go down."
"There will be a recession and house prices will fall."
The above statement is so popular now that it seems to some people to be a self-evident truth that requires no explanation or listen to explanations. But I think the above statements are all false propositions, that is to say, the title itself is not true. For example, “Income cannot keep up with the rise in housing prices, so no one can afford to buy a house.” Some people cannot afford to buy a house, not because of their income, but because of the shortage of housing supply. The reason is very simple. The current maximum repayment period for bank loans is 30 years. If it is changed to the maximum repayment period of 50 years, many people will immediately be able to afford it under the same housing price and income. Therefore, the affordability of housing prices itself is a false proposition. No matter how you study and analyze income, it will not be right. Because the real affordability issue should be how to match the supply of housing with the demand for new housing.If there are only 100 houses and 100 families, and the current home ownership rate is 68%, then the house price is determined by the income of the 68th family. 16 of the 68 families who own houses own 32 investment houses because they immigrated early or have strong borrowing ability, which happens to be rented to 32 families who are currently unable to purchase real estate. After reaching this balance, another 20 families immigrated and five new units were built at the same time. The supply could not keep up with the demand, and the market began to reallocate resources. That is, 120 families faced 105 houses. At this time, housing prices would be pushed up due to competition. On the contrary, if there are 20 new immigrant families and 50 newly built houses, and the supply exceeds the demand, then the market will reallocate resources, and 120 families face 150 houses, and the supply exceeds the demand, and the housing prices should fall sharply. "If housing prices rise faster than wages, there is a bubble." This statement makes absolutely no sense. It is even more absurd to say that if there is a bubble, it will burst sooner or later. The bubbles in Hong Kong, New York, Beijing, Shanghai, Guangzhou and Shenzhen are big and hard, and there are no signs of bursting. As long as Canada maintains a positive immigration policy and a negative housing construction policy, housing prices will continue to rise. , if banks extend the repayment period from 30 years to 50 years, the demand for housing will be greater, and housing prices will rapidly rise to new skylines. It is not impossible for bank regulatory authorities to allow banks to do this, because the longer the repayment period, the easier it is for banks to afford loans, and the lower the loan default rate will be. Any research report, paper, or news about housing affordability is based on a false proposition. Under the current immigration policy, if we do not actively build houses, the problem of continued rising housing prices will not be solved. As for the projects proposed by politicians at all levels to solve the affordability of housing prices, apart from building houses, they are just for show. First-time homebuyer subsidies, building low-cost housing, etc. are all means of specifically buying votes from a certain special interest group. They neither cure the symptoms nor the root cause of the housing price problem. They just waste taxpayers' money and delay the problem of high housing prices from being solved.
01 The logic of house prices
Houses are for living in and investing. All 100 families need a place to live, but 32 families rent, 16 families not only own their own homes but also have the ability to buy rental properties, and the remaining 52 families have their own homes and have not invested in real estate. Among these 100 families, 16 families with real estate investment capabilities are not only harmless to humans and animals, but also provide shelter for families who cannot afford to buy a house. The government understands this fact. If it cracks down on real estate investors, it will need to provide rental housing. The list of people who apply for special government care will be lengthened, and the waiting time will continue to be postponed. The government will feel great pressure.House prices refer to the last family that can afford a house, that is, the first 68 A family is determined by its financial ability , the logic of housing prices is to study the financial status of this 68th family. Whether the government should intervene in housing prices is also based on the fairness of whether the 68th family can afford a house morally. If the government believes that the current 68th family can afford a house because of unfair standards, the government may use its visible hand to intervene in the real estate market. Otherwise, the market should be allowed to decide who is the 68th family. For the 16 families who invest in real estate, the houses are used for both living and investment; for the 52 families who only own their own houses, the houses are their own and are mainly used for living and also taking into account the value-added function; for the 32 families who rent, the houses are rented and purely used for living. In a legal system where the king is under the law, market competition will naturally screen out the 68th family.
"Internet technology will reduce the need for people to live together, so no one will live in houses in big cities in the future, and housing prices in big cities will fall in the future." This is a serious misunderstanding of the logic of housing prices, so much so that the proposition itself is a false proposition. After cars replaced horse-drawn carriages, people did not move out of big cities. Instead, they lived more densely. This is because industrialization requires people to live together and carry out a more detailed division of labor. Family workshop-style production can only feed one's own family, and it is difficult to produce a large amount of surplus goods for exchange with other people. After the phone replaced letters, people communicated more. People found that many things could not be explained clearly on the phone and they needed to meet in person. Without the phone, there would not have been so many opportunities to meet with little communication. The emergence of the Internet is the same as the emergence of the telephone. The convenience of communication stimulates the need for meeting, rather than replacing the need for meeting. All technological advances throughout the ages have fueled the need for people to live together, rather than replacing the need to be close to each other. The author of "Walden Pond" couldn't bear it after living in the mountains for a year and returned to urban life. If rural life is really good, why not live there for the rest of his life? Our methods of punishing criminals still follow the methods we used a long time ago, making prisoners unable to communicate with other people, and using solitude to punish those who disrupt social order, because humans are social animals and instinctively need to communicate. The epidemic has spawned an exercise in escaping from the metropolis, but the exercise is not actual combat, and people are now turning around and running into the city. The agglomeration effect of cities stems from the need for fine division of labor and reliance on exchange. Only deep division of labor and non-stop exchange can improve everyone's wealth., this is a law discovered by Adam Smith 230 years ago. The more advanced technology is, the greater the value contribution of capital will be, and the more valuable the manpower that matches the capital will be. Where manpower is more expensive, housing prices will be higher. Professor Xue Zhaofeng said in a comment on the "Qi Pa Shuo" program: "When making dumplings, if there is more flour, the meat will be more expensive; in places where there are many boys, girls are more expensive; in capital-intensive places, the value of labor is high." Housing prices in metropolitan cities have attracted capital because of technological progress, and capital has attracted high-income people, and high-income people have pushed up housing prices. The income of the 68th person in the population who can afford to buy a house increases rapidly with population agglomeration. People whose income has not increased will be surpassed by latecomers even if they immigrate early but are slow to buy a house. After a certain critical point of housing prices and income, some people will be completely priced out. This is why many old immigrants always lament that housing prices are too high. The more advanced technology is, the stronger the agglomeration effect in metropolitan areas will be, and the more expensive housing prices will be, not the other way around.
The current average house price in Toronto has exceeded 1 million. With such high housing prices, there are few opportunities for speculators to speculate in real estate. Ten years ago, the average house price was less than 500,000 dollars, and decorators could flip a few houses despite their hard work. But now, if you buy a house worth 1 million dollars, renovate it and sell it, it is not only more risky, but also less profitable. "House prices are speculated by speculators, and cracking down on speculators will lower housing prices." This statement is basically untrue in an environment of high housing prices. In cities with high housing prices such as New York, Tokyo, Korea, and Hong Kong, there are very few real estate speculators. People with decoration skills have no money, and rich people have no decoration skills. People who combine skills and resources are too scarce. Starting in May this year, Canada levied a consumption tax (HST) on the full price of the contract for the transfer of pre-construction properties, which has deeply hurt speculators in the off-plan property market. The government's attempt to get a share of pre-construction property speculation is simply unethical, causing speculators to leave the market angrily, and causing the sales of pre-construction properties, which rely heavily on speculators, to fall into an unprecedented downturn. The prices of pre-construction properties are indeed speculated by speculators. The current asking price for pre-sales by developers is really high for real home buyers. The practice of having all the uncertainty borne by buyers will be too high-spirited. Developers need to reflect on themselves. “The value of pre-construction properties increases faster than second-hand houses.” This sentence is deceptive and self-deceptive.If you don’t buy a second-hand house now at 1,200 dollars per square foot, go and buy an off-the-plan apartment for 1,800 dollars per square foot. When the house is handed over, if the surrounding second-hand houses have not risen to 1,800 dollars per square foot, the bank’s valuation will not be 1,800 dollars per square foot. This is obvious. Banks don’t care how high the cost and administrative expenses of a new house are when they appraise, because what they want to look at is the market value, that is, the market price, not the cost price. In the same way, if a buyer of a new house wants to sell it immediately after handover, he can only sell it at the market price. If the purchase price of the pre-construction property is 1,800 dollars per square foot, it is said to be the developer's cost price. When selling after handover, if the market price is 1,600 dollars per square foot, the market will not care about your cost price. This happened to all the pre-construction properties handed over at the beginning of the epidemic.
"Interest rates have risen, so house prices will fall." This statement cannot be supported by strong facts. In the interest rate hike channel throughout 2018, condo prices in Toronto have continued to rise without even the slightest correction. With such a drastic interest rate hike in 2022, the price of condos in Toronto is still at a low level. People who are looking forward to falling house prices are told mercilessly that interest rates have nothing to do with the prices of condos in Toronto. In the Canadian real estate market, the only thing that has a direct causal relationship with interest rates is rent. That is, whenever interest rates are raised, rents will rise sharply. On the contrary, it is supported by facts that when interest rates fall, housing prices rise. In addition, during the interest rate hike channel, it is very common for real estate transactions to be sluggish and transaction volume to decline. This will be the case in 2018 and 2022.
"The economy will recession, so house prices will fall." This statement is not true. The latest economic recession was the economic recession caused by the epidemic, and house prices did not fall but rose. Due to the economic recession caused by the subprime mortgage crisis, U.S. housing prices fell, but Canadian housing prices remained very strong. The reason here is also very simple. As long as there is an economic recession, the central bank will cut interest rates and over-issuance of money, which will lead to an increase in housing prices instead of a decrease. One of the functions of the central bank in modern society is counter-cyclical regulation, and the strength of the central bank's hand may not be accurate, and it often goes too far, producing unexpected effects. The central bank's manual regulation will most likely result in higher asset prices, including real estate and stocks. There are no economic principles here, it all depends on the central bank patting the head, so there are no rules to follow. Investors rely entirely on their courage and dare to follow the central bank's regulatory policies. In July 2020, the Governor of the Bank of Canada promised in a televised speech that interest rates would not be raised before 2024, and advised the public to actively take out loans to buy houses. If you dare not follow up, the result will be that others will follow up, and you will become relatively poor. 52 families who only own their own homes but do not invest in houses thought, "It is enough for me to own my own home. If I do not participate in real estate investment, there is no risk of losing money. If there is no buying and selling, there will be no harm." The result is that the price of self-owned homes has increased, but compared with the families who have invested in real estate and followed the central bank's regulatory policies, they have become relatively poor. Without buying or selling, there is also harm.
In Canada, the logic of housing prices is this: market competition determines housing prices. The last person who can afford a house will pay the highest amount. This last person changes all the time. The more new immigrants there are, the more intense the competition will be. The best ones will win; the central bank’s hands have never stopped, and every day We are creating uncertainty and want to stop and wait for certainty, which will never come. The decision of whether to buy a house is in the hands of each family, but the power of whether to get a loan is in the hands of the bank. Housing prices will pass by the family's ability to purchase a house. Families need to seize the opportunity to buy a house when they can afford it. Of course, they need to You have to take the risk of some uncertainty; speculators are being driven out by high housing prices in the second-hand housing market. The futures market, which is favorite among speculators and does not require loans, is now officially coming to share the pie. Speculators are becoming unprofitable in the futures market; the price of real estate in metropolitan areas depends on The dual value of residence and investment, the scarcity of location is the core of value, or in other words, the more wealthy people live on which land, the more expensive the properties on that land will be. Large houses in the suburbs are not necessarily more valuable than small houses on scarce land. People who go to the suburbs to buy big houses are learning lessons. In a free market environment, coupled with the regulatory control of the central bank, Canadian housing prices are characterized by currency issuance and interest rates dominating the short-term market, while insufficient housing supply and long-term stable immigration policies determine long-term housing price trends. Canada’s urbanization rate is 81% , is in the post-urbanization stage, characterized by new immigrants landing directly in big cities, and professionals from small cities concentrating in megacities. Ontario is the province with the most employment opportunities, attracting more and more people every year. 48% of new immigrants settled. The more concentrated the population, the more diverse the industries and the more job opportunities there are. Capital prefers to invest in densely populated metropolises because there are high-tech industries here, and capital attracts highly paid professionals. The characteristics of cities created by high- and new-income earners are that housing prices are constantly pushed up, and competition leads to 100 In a family, the 68 The income of a family that can afford to buy a house has gradually been pushed up, and families living in Canadian metropolitan areas will fall back if they do not advance.
In all developed countries that have entered post-urbanization, the first comers have the advantage of existing wealth. A house bought for 350,000 dollars 30 years ago can easily be sold for 1.5 million. The intergenerational transmission of real estate cannot be completed by the savings of latecomers, and must be helped by credit. The United States once practiced credit egalitarianism, which resulted in the subprime mortgage crisis. Commercial banks in Canada follow the principle of merit in the mortgage business, and you must meet the college entrance examination score line to obtain a mortgage. Families that obtain loans under unusual circumstances are suffering from loan sharking. The biggest beneficiaries of the credit policy are the 16 real estate investor families. The common feature of these families is that they have very low owner-housing debt on their left shoulder, and they carry the negative cash flow of all investment properties on their right shoulder. This is the product of the current Canadian credit policies and principles. The inequality in real estate wealth among Canadians is entirely caused by credit discriminatory policies. The income discrimination in credit policies ensures that banks lend money to those families who can afford to repay the loans, allowing these families to undertake the intergenerational transmission of more properties. It also creates a stable real estate market and a group of new real estate wealth. In Canada, the disparity in real estate wealth is huge because of debt inequality.
02 The logic of debt and credit
"The debt is 180% of a household's disposable income. If the debt burden is too heavy, housing prices will plummet." This sentence conceals the true situation of Canadians' debt situation. In Canada, the debt ratio borne by the top 40% of income earners is 70%, so dividing the total debt by the average income yields an impossible result, that is, 180% of monthly income is used to pay debt. The distribution of debt among households with different incomes is a power law distribution, not an average distribution. Households with higher incomes have higher debts, and households with lower incomes have less debts. According to the investment mortgage formula: The loan amount for each investment house is based on the family’s annual income. 5 Calculated by multiplying the balance of the owner-occupied house, each family can borrow up to 10 If you buy an investment house and have no debt on your left shoulder, you can theoretically carry it on your right shoulder. 50 Investment property debt of multiple times annual income. Credit policy is a guide to debt management. By following the credit policy, you can optimize your debt and obtain the most low-interest mortgage loans in Canada. The gap in borrowing capacity determines the gap in real estate wealth.
There are three types of debt, and correspondingly there are three types of credit. 1. Production debt, such as a loan to buy a tractor, a mortgage to buy an investment house; 2. Debt owed to purchase assets, such as a mortgage loan to buy a home, a shop or factory loan; 3. Consumer debt, such as a loan to buy a yacht, furniture, car loans, student loans and credit card debt, etc. The more debt of the first type, the better. The larger the balance, the stronger the borrowing ability and the more assets that can generate cash inflow; the second type of debt needs to be paid off as soon as possible, and other investments are not worth considering before it is paid off; the third type of debt is best not to have a penny at all, unless you are at a special stage of life, for example, you need to apply for a student loan to study medicine. The first type of debt is the largest for the rich, the second type of debt for middle-class families is heavier, and the third type of debt is the main debt for poor families. All debt is the result of credit.
Credit plays the most important role in the intergenerational transmission of real estate. Whoever gets the loan can obtain the stock wealth from the previous generation, and in the future, by passing the real estate to the later generations, they can realize the investment income and use it for retirement. The important role of credit is not known to many people. In fact, credit is as ubiquitous as air. When we buy a drink at the bar with cash for 15 dollars, the transaction is completed. If we buy the drink with a credit card, the transaction is not completed on the spot, but is delayed until the credit card bill is paid. In current market transactions in developed countries, cash in circulation accounts for 3%, and transactions completed using credit means account for 97%. The Bank of England also confirmed Dalio’s statement that nearly 5% of currencies are issued by central banks, and 95% of currencies are created by commercial banks through credit. By swiping a credit card to pay for a beer, before the credit card bill is paid off, commercial banks create 15 dollars of new currency with the help of a plastic piece of credit card. Therefore, The essence of debt is to prolong the time it takes for a transaction to close , money is created the moment a loan is made, and it takes one month to several decades to repay the debt; The essence of credit is to create money immediately and give it to people who qualify for loans. The bank will recover the principal and interest in the next few decades based on the loan contract.Who is given credit and who is not given involves the distribution of benefits and the transfer of rights. In a society, families who cannot get loans always have a victim complex. This feeling is right. Indeed, banks give the opportunity to immediately obtain newly created money to families who can obtain loans, and generously require the payment of very low interest. For mortgage loan borrowers, banks are more lenient and allow borrowers to pay off within 30 years. This unfairness of credit benefits has not been opposed with much fanfare, because the opponents are afraid of losing face and exposing their weak position.
When banks grant loans, the first factor they consider is the borrower's borrowing ability, followed by the collateral. Borrowers must first prove their ability to repay. Entrepreneurs must prove the source of repayment for this new loan, mortgage applicants must prove the source of repayment for this mortgage, and applicants for consumer loans must also prove their source of repayment. When banks allocate credit resources, the first factor they consider is the certainty of repayment, followed by interest rates, and the third factor is the allocation of capital. Compared with mortgage loans, commercial loans have less certainty of repayment and the assessment process is more time-consuming and labor-intensive, so the interest rates are higher. The risk-weighted ratio of commercial loans is higher. A commercial loan requires more bank equity support. Therefore, although mortgage loans have lower interest rates, they are more favored by commercial banks. Canada's credit business is basically in a free market environment. As long as it follows the established risk-weighted rules and deposit reserve requirements of the Basel Agreement, it is rare to see industry guidance from regulatory authorities, except for the environmental protection requirements in recent years; there are no deposit-to-loan ratio requirements; there are no administrative orders such as loan restrictions under the household registration system, so commercial banks have very large discretion. In addition, mortgage asset securitization is very developed in the United States and Canada. Banks can sell mortgage loan assets in the bond market at any time, so the supply of mortgage loan funds is unlimited. To sum up, the most developed credit business in Canada is the mortgage loan business. The quality of mortgage loans is very high under the unified requirements of the B20, thus ensuring the safe and effective inheritance of real estate between generations. The mortgage loan business is a bottom-up bank credit business. The bank will only accept the application if the applicant applies. Unlike the credit card business, the bank pre-approves a quota and hopes that the applicant will collect it. Families who desire real estate wealth need to take the initiative to understand the bank's credit policies, improve their repayment ability, and actively optimize the household debt structure. Otherwise, it will be difficult for them to be favored by banks.
A mortgage loan for an investment property can be counted as a productive debt because there is rental income as a source of repayment. Simply judging the debt level regardless of the nature of the loan is too high. It is a rational value judgment made by many people based on wishful thinking, rather than an objective and rational judgment made with tools. Families with little real estate wealth either have low incomes, do not understand debt management, or dare not invest in real estate. Instead, these families will fall into self-righteous rational judgments of value. These people even criticize real estate investment as immoral. Obviously, this is also a value-rational judgment, which is irrational from the perspective of instrumental rationality.
03 The logic of real estate investing
The sharpest criticism of real estate investment is, "Real estate investment is immoral. You bought so many houses and pushed up housing prices. Young people can't afford a house, so they will flee the big cities. Real estate investment will harm their children and grandchildren." This statement, which seems to stand on the moral high ground, sounds reasonable at first, but think about it, without real estate investors, would houses available for rent fall from the sky? Young people need to rely on their own efforts to gain a place in the big cities. Don’t we also rely on our own efforts to afford a house now?
Among the expenses for food, clothing, housing and transportation, the cost of housing is getting bigger and bigger. The reason is that people's pursuit of housing continues to increase, but there are very few housing options, either buying a house to live in or renting a house to live in. The two most basic principles of economics are the contradiction between supply and demand and the number of alternative choices. In the Canadian real estate market, the specific manifestations of these two principles are: the contradiction between supply and demand for housing stems from the mismatch between the increasing number of new immigrants and the construction speed of new homes. People's willingness to buy a house is constantly changing due to short-term financial factors, but the rigid demand for housing is still there. Therefore, rents rise when the willingness to buy a house is low, and house prices rise when the willingness to buy a house is high. Under the established immigration policy, as short-term financial policies fluctuate, house prices and rents in Canada rise in turn. The logic of real estate investment is to take advantage of the most basic contradiction between supply and demand and the objective fact that there are few alternative options. When others are unable or afraid to buy a house, you can use your own knowledge of debt management and your current income advantage to obtain a mortgage loan and buy a house for yourself. In this name, you can use rent and your own income as the source of repayment, persuade banks to grant more mortgage loans, hold multiple properties, seize the opportunity before the contradiction between supply and demand is resolved, and obtain more existing wealth than others. At the same time, it will also have a positive external effect of providing more rental housing. There is nothing immoral about doing this.
"In the development of the national economy, real estate accounts for too large a share, squeezing out resources for the development of other industries and affecting economic development." This sentence is wrong. In Canada's GDP, the real estate industry accounts for about 9%, of which new housing accounts for 6% and second-hand housing transactions contribute only 3%. Second-hand houses, like second-hand cars, are the transfer of asset ownership in the stock market. The house price paid by the buyer, except for commissions and taxes, is all transferred to the seller. According to the law of conservation of energy, the total wealth of the whole society remains unchanged. The reason why the buyer feels that he has been hollowed out is because he bought it late and became the seller's cash-out home. When the buyer unloads the goods in the future, the funds will be turned around again. Commissions and taxes on second-hand housing sales only contribute 3% to GDP. The activity of second-hand housing transactions determines the income of real estate practitioners and the tax revenue of the government. This is an inevitable cost for the normal operation of the economy and the intergenerational transfer of real estate assets. It is understandable. Jealousy about the income of real estate practitioners has blinded many people, and the income in this industry is not higher than that in other industries.
"Real estate investment is too illiquid." This is a verdict-like conclusion that many people blurt out, and it cannot be questioned or discussed. In Canada, this statement is wrong, because families that maintain good borrowing ability can cash out their mortgages when housing prices are high, instead of just selling them. In the many mortgage businesses I have handled, I have seen that many real estate investors have excess liquidity instead of insufficient liquidity. Real estate investors who have no money temporarily apply for a credit line as a cash substitute and backup, thus maintaining the wealthy status of the landlord's family.
"Real estate investment is to make money. If there is no positive cash flow, there is no need to invest in real estate." In Canada, this sentence is not true. Many real estate investors earn enough from their careers to live without having to maintain positive cash flow from their investment properties. On the contrary, more and more real estate investors realize that the positive cash flow from investment properties not only increases the tax burden, but also reduces the leverage effect of real estate investment. The higher the down payment ratio, the greater the cash flow, the higher the net rental income, the heavier the tax burden, and the smaller the leverage effect. The pursuit of positive cash flow runs counter to the investment purpose of balancing lifetime income.
Conclusion:
The current instability of financial policy has caused many fallacies about real estate to become rampant again. Don’t forget that financial policy is short-term and can change at any time. On August 1, the Bank of England canceled the eight-year-old stress test policy in order to release the ability to purchase houses. The British Prime Minister also threatened to extend the repayment period to 50 years. Buying a house and investing in real estate are long-term plans. People who are blinded by short-term changes need to take a long-term view. One conclusion that Max Weber reached through his observations of modern society is that instrumental rationality will overwhelm value rationality. Rationality means making judgments and taking actions based on self-interested calculations. Instrumental rationality uses the effectiveness of cost accounting as the criterion; value rationality uses morality, aesthetics, dignity and religion as the criterion. The changes that instrumental rationality brings to modern society are that it improves efficiency, increases wealth, reduces individual subjectivity, and improves the predictability of economic development. The development of the entire modern society is a process in which instrumental rationality overwhelms value rationality. As modern people, we need to minimize value judgments and use instrumental rationality as much as possible to make self-interested calculations of long-term interests. Only by clearing away the fog in front of us can we get rid of the herd effect of the crowd and make objective judgments about future well-being. In the short term, people who buy houses now are fools who hold different opinions. In the long term, the people who agree with each other and believe the above false proposition are the fools. I hope this article can once again help you clear away the fog in front of you and become a smart and rational modern person.