@1: Yes, those small percentages from multiple levies cumulatively amount to an annual property tax bill of around 6K to 10K for average homes in the Seattle area.

Excellent article Charles. I really appreciate it when you boil things down like this. I already knew this, but didn't know some of the terms.

You don't have to be a Marxist to question many of the assumptions that are made. Quite the opposite. The inflation in the 70s was caused by a cartel (OPEC). Inflation in the housing market is caused by an unofficial cartel (zoning). A lot of the more recent price increases are due to the tiny number of (unregulated) companies providing an important role in the economy.

There are other factors, in every case. Instability in the Middle East disrupted the oil market. Disparity in income and regional disparity contributed to the rise in property costs. The pandemic is playing a big part in the current inflation (obviously).

But in all the cases, with more competition the problem wouldn't be as bad. Like most problems, there is more than one cause, but interest rates being too low isn't one of them.

It's weird psychosis that almost everyone has bought into. Everyone understands that when the price of health care, food, clothes, or heat goes up, that's bad thing. But when the price of another basic need, housing, goes up, that is almost always characterized with a positive spin "property values are up, hooray!" It's wonderful if you are able to afford to buy a house, but it would be nice if American homeowners at least acknowledged/appreciated that their windfall capital gains is directly linked to another family's homelessness.

@4: If you are going to extrapolate guilt to that extent, you should aim higher than property tax taxpayers and capital gains taxpayers.

@5, OK, fair point. Can we agree that there is something vaguely sociopathic about enacting a law with the primary goal of inflating the cost of housing, a basic human need? If a lawmaker bragged about voting for a bill whose goal was to increase the cost of food, or medicine, you would consider him/her something of a monster.

Good work Charles Mudede, you got all the basics right. One thing about '70s inflation that people seem to forget is that Nixon/Ford cut the dollar loose from gold, and import prices rose as the currency was allowed to "float". Inflation now is nothing like the 70s, driven at first by supply issues and now by plain old corporate greed.

@oldwhiteguy Both your numbers and logic are way off here, and your "let them eat cake" attitude on all the Americans (renters and otherwise) being hammered by the current severe inflation is bizarre to say the least. No, 65 percent of Americans do not own their own home and no, large majority of homeowners are not benefitting from this inflation--there is a large percentage of American households where the residents are related to the primary homeowner but there are not 212 million homeowners in the USA, those are 2 way different things. In fact more and more of the "homeowner relatives" in those homes are fully employed Millennials, GenXers and Zoomers locked out of homeownership due to the insane US housing bubble right now, fueled by price-gouging and investors like Zillow and Blackstone buying up single and multi-family homes and then jacking rent up so much that people can't save. This is a big reason for the US birth rate crashing to the floor, and why young Americans are moving back in with family (those primary homeowners) in record numbers--looking at Millennials, the US now has one of the lower homeownership rates in the developed world due to this. Even then your 65% number is way off and the big majority of those in the homes don't own them yet--they're still paying off mortgages and the banks are the owners until that's done.

And to your "homeowners like this inflation" reasoning--are you serious? It isn't just property taxes that go up with sick inflation like this, it's everything. My wife and I are among the lucky professional Zoomers to have a home, but it's not just property taxes (which are crazy high up in the PNW) that bite, even worse is the insurance costs, HOA fees, basic maintenance repairs, household tools, utilities, everything. Yes our property value has gone up, but that's largely meaningless since if we sell, we'd just be back to buying in the same insanely inflated market, so we gain nothing but also get hit with extra taxes, fees and even worse closing costs. There's also the cost in time for having to keep up with everything and negotiate on every dumb detail and cost with inflation at this level. We actually do own a separate rental property and regret it now, since we've had to raise rents with all the upkeep inflation and our tenants are justifiably angry, and it's costing us hugely in time, direct expenses and property management fees since every little dumb thing (including basic plumbing and weather-proofing) is so much more expensive now. And then of course there's the sky high cost in everything else (gas, food, healthcare, even a simple used car) that gets worse and worse. It's way out of touch to suggest it's "just renters" who are ticked off by all this inflation in the US, it's just about everyone who's seeing their dollars' purchasing power and hard work get devalued, which is almost every American. That's why inflation is devastating the poll numbers of any politician dumb enough to fantasize it was just transitory in 2021.

And no you can't "inflate your way out of debt"--whether a household or a government--because the increasing costs of essentials and inflation-indexing eat up whatever "debt devaluation" occurs and then some. Yes our salaries have gone up working in tech, but not enough to keep up with the real inflation. Just to be clear we despise what the ultra-rich and oligarchs are doing with their manipulation of the media and financial industry, but no it's not their gas-lighting that's making Americans angry about inflation, it's the real damage it does to Americans' buying power. The ultra-rich are feeling this inflation pain a lot less since they've been able to buy up so many assets (these days including crypto and NFT's) that are getting stupidly valued with the Federal Reserve's incompetence on interest rates and QE. Yes a lot of them are doing price-gouging with their monopolies, but Democrats in particular need to step away from the "inflation is only bad for the rich" foolishness, it's far worse for the Democrats' base of the middle and working classes, due to the prices they're seeing with their own eyes. This "inflation is good for you" cluelessness is Paul Krugman's fantasy hobbyhorse and he's leading Democrats to disaster if they still buy into these delusions. The rich (and Trump and Republicans) are indeed responsible for a lot of this mess with inflation, but Democrats need to stop being so tone-deaf on it, start placing the blame where it belongs and start more aggressively confronting it.