this post was submitted on 05 Oct 2024
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25k is for first time home buyers, not everyone. You can't have separate prices for first time buyers and the rest of the public, and a seller won't know how you are financed until after the house is listed anyways.
This absolutely will help, because if you'd just ask anyone trying to get a home, the down payment is the hardest part to satisfy.
The only way a house cartel can form like this is for those that own the homes. The builders don't own the homes, corporations do. Those corporations collude and price fix to create a cartel. Focus on that.
The UK had a similar scheme for first time buyers and it's often cited by economists as one of the biggest things fueling their housing crisis.
Its hard to take that at face value. The UK and the US have a lot of anti consumer perspectives.
Do you have anything that describes the mechanism?
Its sort of a similar arguement to food stamps raising food prices right?
In either case its on the groups abusing a rule that are the problem, not the rule. There can be well worded regulations that minimize abuse, and we can also audit things.
Sure, here's a paper which explores the effects.
Essentially, housing prices have hugely inflated (in much of the developed world) because demand is much higher than supply. Prices in the real-estate market are generally really reactive to changes in supply or demand because each 'product' is unique and limited, as well as being worth a lot of money so there is more pressure to maximize the potential gains.
This sort of plan increases the resources available to the demand side without increasing the supply side. This drives up prices since there are more potential buyers.
Anyone who couldn't buy a house without such a program is being added the the pool of people competing for a limited supply of houses. It won't increase supply because supply is heavily limited by other factors, most notably zoning.
It's unfortunate, because the thought behind such a policy is admirable. It's trying to make buying a house more fair and more easily achievable for a broad segment of the population that currently is effectively shut out from owning a home.
The current administration is already doing most of the things regulation wise. Its just not catchy or easy to understand like the down payment assistance part.
The changes the Biden administration has made and is making will take time, houses can't be built overnight, but the down payment assistance helps now.
In my opinion, its only a bad policy if we choose to allow it to be.
They fucked it up then. When obama did 8k it worked well