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There is something very simple that the government could do, that would instantly transform the housing market (and it will never happen). The government shoul

There is something very simple that the government could do, that would instantly transform the housing market (and it will never happen). The government should stop securing >10 year mortgages. Banks wouldn't make these loans if they weren't backed by the feds. And they inflate property prices. The government has been slowly increasing the term length of mortgages that they will securitize, pumping value in to homes, enabling people to lend against that increased "equity". If the government stopped securing these loans, residential land would get a lot cheaper.

JonFish85 11y ago
The reason it would never happen is that, at least in the US, the government has been in the business of trying to make owning a house accessible to people who probably can't actually afford it. As much as people like to cast aspersions on "the banks" for the housing bubble, the government deserves a lot of blame as well for actively promoting the ideas that everyone should be able to own their own home. If they were to do what you propose, that would lead to some uncomfortable circumstances: the only people who can afford a home are the people who come from the middle class and up, which might not represent minorities in an appropriate way. And in such a case this does not bode well for politicians who are looking for votes.