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> 30 year mortgages are a political guarantee to homeowners. And they work; arguably these are one of the reasons why "owning your own home" was able to be som

> 30 year mortgages are a political guarantee to homeowners. And they work; arguably these are one of the reasons why "owning your own home" was able to be something that so many Americans see(saw?) as an unquestionable part of adult life. The government used its political power to make things easier for a huge subset of its less-well-off citizens. > It's pretty much begging to be exploited. And yet it mostly isn't. There hasn't been any huge crash or people getting filthy rich due to the recipients of 30 year mortgages exploiting the system in any way, and recipients are the ones that would be doing the exploiting in the context of your comment. The lenders of course caused 2008, etc, but they're arguably the ones who would hypothetically be exploited. If it were actually begging to be exploited, I would suspect that we would see something different than this.

maxerickson 4y ago
They pretty clearly create upward pressure on home prices. That's a policy failure. Policies to encourage construction directly would work better to increase home ownership than subsidizing mortgages.
- chii 4y ago
  under neoliberal economic theory, the high prices of homes would encourage building more of it. Unfortunately, the existing home owners, directly or indirectly, would lobby local gov't/councils to stop new builds. Current zoning laws also don't help.
yourapostasy 4y ago
> There hasn't been any huge crash or people getting filthy rich due to the recipients of 30 year mortgages exploiting the system in any way... Those very US government programs that implement the political guarantee also implement an exploit in oh, so many programs for non-owner occupants, typically realtors / agents, to leverage in ways they absolutely cannot in a truly open commercial market. Every single realtor / agent acquaintance I've been introduced to will wax on about their impressive portfolio holdings if I give them an opening to do so. Acting innocent, I inquire about the details of their fabulous business acumen. Every single one below the $20M valuation mark, without exception, and most cluster around the $1M valuation mark, hold the bulk of their assets via government or quasi-government-backed paper and not through a commercial bank loan. The US rules around establishing owner occupancy in many programs are insanely easy to circumvent, and for all practical purposes never enforced. There are plenty of people exploiting the program making a pretty penny off of taxpayer largesse. Real estate is one of the most heavily subsidized assets in the US.
kgermino 4y ago
> And they work The US and Canadian homeownership rates are almost identical (around 66%). I don’t think the US’s mortgage subsidies significantly impact homeownership rates.
throw0101a 4y ago
>> 30 year mortgages are a political guarantee to homeowners. > And they work; arguably these are one of the reasons why "owning your own home" was able to be something that so many Americans see(saw?) as an unquestionable part of adult life. The ownership rate for Americans (mostly 30y terms) and Canadians (usually 1-5y terms) is basically the same at around 65%. * https://www.statista.com/statistics/184902/homeownership-rate-in-the-us-since-2003/ https://www.statista.com/statistics/184902/homeownership-rat... * https://tradingeconomics.com/canada/home-ownership-rate https://tradingeconomics.com/canada/home-ownership-rate

maxerickson 4y ago

They pretty clearly create upward pressure on home prices. That's a policy failure. Policies to encourage construction directly would work better to increase home ownership than subsidizing mortgages.

chii 4y ago
under neoliberal economic theory, the high prices of homes would encourage building more of it. Unfortunately, the existing home owners, directly or indirectly, would lobby local gov't/councils to stop new builds. Current zoning laws also don't help.

yourapostasy 4y ago

> There hasn't been any huge crash or people getting filthy rich due to the recipients of 30 year mortgages exploiting the system in any way... Those very US government programs that implement the political guarantee also implement an exploit in oh, so many programs for non-owner occupants, typically realtors / agents, to leverage in ways they absolutely cannot in a truly open commercial market. Every single realtor / agent acquaintance I've been introduced to will wax on about their impressive portfolio holdings if I give them an opening to do so. Acting innocent, I inquire about the details of their fabulous business acumen. Every single one below the $20M valuation mark, without exception, and most cluster around the $1M valuation mark, hold the bulk of their assets via government or quasi-government-backed paper and not through a commercial bank loan. The US rules around establishing owner occupancy in many programs are insanely easy to circumvent, and for all practical purposes never enforced. There are plenty of people exploiting the program making a pretty penny off of taxpayer largesse. Real estate is one of the most heavily subsidized assets in the US.

kgermino 4y ago

> And they work The US and Canadian homeownership rates are almost identical (around 66%). I don’t think the US’s mortgage subsidies significantly impact homeownership rates.

throw0101a 4y ago

>> 30 year mortgages are a political guarantee to homeowners. > And they work; arguably these are one of the reasons why "owning your own home" was able to be something that so many Americans see(saw?) as an unquestionable part of adult life. The ownership rate for Americans (mostly 30y terms) and Canadians (usually 1-5y terms) is basically the same at around 65%. * https://www.statista.com/statistics/184902/homeownership-rate-in-the-us-since-2003/ https://www.statista.com/statistics/184902/homeownership-rat... * https://tradingeconomics.com/canada/home-ownership-rate https://tradingeconomics.com/canada/home-ownership-rate