4 ms·

The renter-owner wealth gap is wider than ever, as many are priced out of buying

9 points by mooreds 2mo ago

toomuchtodo 2mo ago
Interest rates must go up. It’s the only lever available to push housing prices down in the near term.
- Avicebron 2mo ago
  Or we could, build more housing, tax second homes at like 5000% percent and divert that money into housing relief, outlaw AirBnB, prevent people from moving into an area and buying out the locals... the list goes on
  - toomuchtodo 2mo ago
    When will that deliver? Years from now, maybe, if you get started today and can maintain progress. Benchmark rate can go up today with an FOMC meeting and immediately deflate real estate asset prices. Congress won’t act further and the Federal Reserve is independent. (the Federal Reserve directly contributed to this problem by being the buyer of last resort for mortgage backed securities during the pandemic; this created the ultra low mortgage environment that has contributed to inflated real estate prices beyond what wages can support, it is reasonable and prudent for them to reduce the inflation they themselves directly contributed to)
    - Avicebron 2mo ago
      Rate increases don't really work in the US because mortgages don't float.
      - toomuchtodo 2mo ago
        People always have to sell, jobs, divorce, death, etc. Mortgages originated at today’s rates to buy those properties are what govern today’s prices. These sales will, over time, be the comparables that contribute to downward price momentum. ~4.7M real estate transactions occurred in 2025, and based on that setting a new low record, can be a rough estimate of forward looking volume for price discovery. https://www.realtor.com/news/trends/home-sales-data-2025/ https://www.realtor.com/news/trends/home-sales-data-2025/
        Avicebron 2mo ago
        Have you heard about how Medicaid estate recovery combines with TEFRA liens to result in unsellable property that depreciates year over year and doesn't free on the death of the original owner? It's a real thing and surprisingly common in aging populations who may be house-rich and cash poor.
- dragonwriter 2mo ago
  No, we simply need to (the state level is the most likely place to do this) strip localities of the power to limit housing density by zoning restrictions and discretionary de ial or delay of permitting. That’s the barrier to adequate housing everywhere there is unmet demand driving high prices. You don’t need either monetary (interest rates) or fiscal (taxes/subsidies) hammers to get supply built, not will you do much by hitting the problem with those hammers as long as localities are literally prohibiting building.
  - EA-3167 2mo ago
    Saying, "Simply" before a generally extremely challenging notion doesn't actually make it simple or even plausible. Your idea is only simple if a critical mass of people who vote agree with you, and they don't.
    - dragonwriter 2mo ago
      The policy is simple, the politics of adopting it may be difficult. Different issues. But the bigger point isn't the simplicity or not of the policy or its adoption, but that other options will not work without it, and will not be necessary with it.
  - jnyst1985 2mo ago
    This is the way
- robocat 2mo ago
  Each homebuyer usually bids to the maximum they can afford in monthly payments. They bid against each other. The number of buyers remains the same, so although the prices of homes shift, that often doesn't actually change affordability. Yes, interest rates do affect the price one homebuyer will bid to.

9 points by mooreds 2mo ago

toomuchtodo 2mo ago

Interest rates must go up. It’s the only lever available to push housing prices down in the near term.

Avicebron 2mo ago
Or we could, build more housing, tax second homes at like 5000% percent and divert that money into housing relief, outlaw AirBnB, prevent people from moving into an area and buying out the locals... the list goes on
- toomuchtodo 2mo ago
  When will that deliver? Years from now, maybe, if you get started today and can maintain progress. Benchmark rate can go up today with an FOMC meeting and immediately deflate real estate asset prices. Congress won’t act further and the Federal Reserve is independent. (the Federal Reserve directly contributed to this problem by being the buyer of last resort for mortgage backed securities during the pandemic; this created the ultra low mortgage environment that has contributed to inflated real estate prices beyond what wages can support, it is reasonable and prudent for them to reduce the inflation they themselves directly contributed to)
  - Avicebron 2mo ago
    Rate increases don't really work in the US because mortgages don't float.
    - toomuchtodo 2mo ago
      People always have to sell, jobs, divorce, death, etc. Mortgages originated at today’s rates to buy those properties are what govern today’s prices. These sales will, over time, be the comparables that contribute to downward price momentum. ~4.7M real estate transactions occurred in 2025, and based on that setting a new low record, can be a rough estimate of forward looking volume for price discovery. https://www.realtor.com/news/trends/home-sales-data-2025/ https://www.realtor.com/news/trends/home-sales-data-2025/
      - Avicebron 2mo ago
        Have you heard about how Medicaid estate recovery combines with TEFRA liens to result in unsellable property that depreciates year over year and doesn't free on the death of the original owner? It's a real thing and surprisingly common in aging populations who may be house-rich and cash poor.
dragonwriter 2mo ago
No, we simply need to (the state level is the most likely place to do this) strip localities of the power to limit housing density by zoning restrictions and discretionary de ial or delay of permitting. That’s the barrier to adequate housing everywhere there is unmet demand driving high prices. You don’t need either monetary (interest rates) or fiscal (taxes/subsidies) hammers to get supply built, not will you do much by hitting the problem with those hammers as long as localities are literally prohibiting building.
- EA-3167 2mo ago
  Saying, "Simply" before a generally extremely challenging notion doesn't actually make it simple or even plausible. Your idea is only simple if a critical mass of people who vote agree with you, and they don't.
  - dragonwriter 2mo ago
    The policy is simple, the politics of adopting it may be difficult. Different issues. But the bigger point isn't the simplicity or not of the policy or its adoption, but that other options will not work without it, and will not be necessary with it.
- jnyst1985 2mo ago
  This is the way
robocat 2mo ago
Each homebuyer usually bids to the maximum they can afford in monthly payments. They bid against each other. The number of buyers remains the same, so although the prices of homes shift, that often doesn't actually change affordability. Yes, interest rates do affect the price one homebuyer will bid to.