So Trump voiced his idea of 50-year mortgages. This is insane -- only if you assume there is an interest charge.
What would you think of 50-year mortgages with zero percent interest for families with more than 5 kids? Like, each child knocks off the interest rate by a little bit. Add in a condition that the parents must stay together to claim the benefit...
Property taxes can also be used this way. Allow states to levy high property taxes, but then set them to all but zero for the primary homes of families with children. No kids? No tax benefit.
Obviously we'd have to control what sort of people can take advantage of these offerings.
Realistically, the way we make housing more affordable is to make more housing. Right now there are no real estate developers thinking "I can make a lot of money dividing up land into 1 acre lots with 1,000 sf homes on them." Why not? Because no one wants that. Or if they do, they can't afford it. What's going on? I think it's the whole paradigm of "my house is my investment" and banks getting involved. Houses used to be something you could buy for a few years of wages. No one used to own a home they couldn't rebuild in less than a year on their own or that they couldn't afford to rebuild. We need more builders, we need more individuals building their own homes, and we need to get banks out of the picture. Use cash for these kinds of transactions, not credit and certainly not loans.
Manufactured homes are a real thing. They are not ridiculously expensive. Lots of low-income workers buy them in my area. They want a home that they don't have to borrow money to build on land they didn't have to borrow money to buy. It's a very good solution. My grandparents lived in a double-wide when they retired. That was their "dream" home. If you can't afford a manufactured home, you can probably find a used trailer house. Yes, they suck, but they are functional and cheap and they're not hard to maintain.
The point is there's ways to "fix" the real estate market that don't involve government regulations.
Here's another idea.
I've already seen land co-ops going up and there are quite a few. You have to look for them and many just aren't available to the general public (as it should be.) The basic idea is you pool people's resources, buy a bunch of land, and then build your own homes on that land. If you get 5-10 young families involved, they could "purchase" construction services from each other. "You help me build my house, I'll help you build yours" type deals. The only thing you need to buy is construction materials and the land. If this sounds appealing, look into it, I think a lot of homesteaders want something like this, and if they are in a small tight-knit community with other like-minded people all the better.
My particular take on the land co-op thing is to have a corporation that is owned exclusively by the people who live on it. Buy something like 1,000 acres and use it for agriculture. Hire employees, mostly from the owners of the corporation, or divide up the land among them for their own purposes. Some of them can run cattle, goat, sheep, chickens, etc.. and the others do various kinds of farming. Rotate the land over the years for maximum yields with minimum inputs. Give each owner a small half-acre lot in a corner of the land, build a little playground and a community hall or something and have each person live in a small house. Since ownership in the corporation is tied to actually living there, there's no chance of outside investors taking over, especially if you actually make a successful farm.
I think suburbs are done for. They're no longer useful. Just like cities became useless once mass transit became a thing, suburbs are no longer essential since we don't need to commute to work for most jobs. It makes way more sense for someone to plop down a factory in the middle of nowhere, especially since you don't need thousands of workers to keep that factory working. I can see a time where, just like in the past, your job and your home were almost the same thing.
Stop expecting government to solve your problems. Think really hard about what the real problem is and you'll find your own solutions, just like your ancestors did.
What would you think of 50-year mortgages with zero percent interest for families with more than 5 kids? Like, each child knocks off the interest rate by a little bit. Add in a condition that the parents must stay together to claim the benefit...
Property taxes can also be used this way. Allow states to levy high property taxes, but then set them to all but zero for the primary homes of families with children. No kids? No tax benefit.
Obviously we'd have to control what sort of people can take advantage of these offerings.
Realistically, the way we make housing more affordable is to make more housing. Right now there are no real estate developers thinking "I can make a lot of money dividing up land into 1 acre lots with 1,000 sf homes on them." Why not? Because no one wants that. Or if they do, they can't afford it. What's going on? I think it's the whole paradigm of "my house is my investment" and banks getting involved. Houses used to be something you could buy for a few years of wages. No one used to own a home they couldn't rebuild in less than a year on their own or that they couldn't afford to rebuild. We need more builders, we need more individuals building their own homes, and we need to get banks out of the picture. Use cash for these kinds of transactions, not credit and certainly not loans.
Manufactured homes are a real thing. They are not ridiculously expensive. Lots of low-income workers buy them in my area. They want a home that they don't have to borrow money to build on land they didn't have to borrow money to buy. It's a very good solution. My grandparents lived in a double-wide when they retired. That was their "dream" home. If you can't afford a manufactured home, you can probably find a used trailer house. Yes, they suck, but they are functional and cheap and they're not hard to maintain.
The point is there's ways to "fix" the real estate market that don't involve government regulations.
Here's another idea.
I've already seen land co-ops going up and there are quite a few. You have to look for them and many just aren't available to the general public (as it should be.) The basic idea is you pool people's resources, buy a bunch of land, and then build your own homes on that land. If you get 5-10 young families involved, they could "purchase" construction services from each other. "You help me build my house, I'll help you build yours" type deals. The only thing you need to buy is construction materials and the land. If this sounds appealing, look into it, I think a lot of homesteaders want something like this, and if they are in a small tight-knit community with other like-minded people all the better.
My particular take on the land co-op thing is to have a corporation that is owned exclusively by the people who live on it. Buy something like 1,000 acres and use it for agriculture. Hire employees, mostly from the owners of the corporation, or divide up the land among them for their own purposes. Some of them can run cattle, goat, sheep, chickens, etc.. and the others do various kinds of farming. Rotate the land over the years for maximum yields with minimum inputs. Give each owner a small half-acre lot in a corner of the land, build a little playground and a community hall or something and have each person live in a small house. Since ownership in the corporation is tied to actually living there, there's no chance of outside investors taking over, especially if you actually make a successful farm.
I think suburbs are done for. They're no longer useful. Just like cities became useless once mass transit became a thing, suburbs are no longer essential since we don't need to commute to work for most jobs. It makes way more sense for someone to plop down a factory in the middle of nowhere, especially since you don't need thousands of workers to keep that factory working. I can see a time where, just like in the past, your job and your home were almost the same thing.
Stop expecting government to solve your problems. Think really hard about what the real problem is and you'll find your own solutions, just like your ancestors did.
You work until 65... retire...
And then have another 3 years of house payments coming out of your Social Security, otherwise it defaults and you lose it to foreclosure?
What if you're 66 when you lose your house and can't find work because you're old?
The only question the bank has before handing out a loan is whether the collateral is good enough to cover the risk of the loan. A key fact here is that as long as you make your payments on time, the bank doesn't even really care whether the house exists or not. It's once they notice that there's a risk you can't make the payment that they start thinking about how much the house is worth, etc...
If you lived in the house, did some minor improvements, and otherwise kept up on payments, and then lost your job or your ability to make those payments, the obvious solution is to sell the home and pocket the difference. If you are a fool and try to hold on to the house despite the fact that you cannot make the payments, then you risk all sorts of bad stuff such as penalty rates and things, which could ruin you.