Consider the last time that we had a similar situation of a time of low inflation, low mortgage  rates that transitioned to very high ones - I'm thinking of 1954 to 1980. The Bank of Canada's inflation calculator says that we went up 214.79% in that span, so that a dollar worth in 1954 cost $314.79 by 1980. In that time, a typical mid 1950's house in Vancouver worth $10,000 rose to around $100,000 for a roughly 1000% gain. My parents place went up far more than that due to land speculation. Contrast that with the Dow Jones index, which was at 292.39 in January 1954 and rose to 875.85 in Jan 1980, essentially just matching inflation, nothing more. You got some dividends from the Dow, but you paid tax on that and on the capital gain if you sold the stocks.  In comparison,  you got to live in the house, were more easily able to leverage it via a mortgage and got a huge tax free gain that vastly exceeded inflation. Any wonder that people prefer real estate?