There are a few outliers but in general it's good jobs, affordable housing, pick one.
If it is a side effect of cheap money, how is it pricing people out of the market? The rising sticker price of the property should be offset by the lower price of money which is driving it, so that the actual total real cost of the purchase (including the financing cost) is the same.
Only if something other than the general price of money (an increasing spread between the price of money for favored debtors and disfavored ones, presumably including the young people priced out of the market) is driving real estate prices should someone be priced out of the market.
Maybe rational buyers have been priced out of the market?
> I could make a 5% downpayment and have a mortgage till the day I die, but that doesn't seem reasonable to me.
Right, but if the only price increase was attributable to the lower price of money, you'd have a mortgage just as long and with just as much burden now as before the decrease in the price of money -- you'd just pay a higher nominal purchase price on the house, and lower interest and fees associated with the loan.
If, instead, you've been priced out of the market, that means something other than a general decrease in the price of money is involved, because the increase in the prices is out of line with the decrease in the price you would pay for financing. If it is cheaper money driving the price, its money that has gotten cheaper for some other class of potential buyers than it has for you.
Say one or two houses sell way over market value, that drives up the price of all the houses in the neighbourhood. If that happens a few times you have massive price increases fueled by easy access to money.