Question

the interest rate and the purchase of houses have a positive relationship. true or false

Answer 1

The answer is,

False.

there is negative relationship between intrest rate and purchase a house.

Explanation : The intrest rate means the proportions of loan that charged as intrest. So here the increasing in intrest rate will increase in payment of loan. Generally increasing in intrest rate resultant decreasing in the property values.

For better understanding i will give you an example,

Consider that a men whos loan is $25000. With intrest rate 4.50% per month. So he can afford the purchasing a house of price $175000. If the intrest rate of loan of men will increased by 5.50% then the person will afford the purchasing a house of $125000. So here ​here there is negative relationship between intrest rate and purchase a house.

As intrest rate is Increases the purchase of house will decrease.

Hope you understood.

Thank you.