With 30 year fixed rate interest rates rising this year from ~3% to over 6% (for the first time in ~14 years), Biden’s policies are crippling the American home building industry and are reducing new home affordability dramatically for many young Americans.
Actually, quite the opposite. If no one is buying houses, the sellers have to lower their price, making housing more affordable to buyers.
Even if new home prices were to decrease by 20% (which they will not), the monthly payments @ 6% would still be more than they were @ 3%. So NO, new single-family housing will NOT be made more affordable to buyers.
You don’t understand economics.
The historic low interest rates for 3 years crippled the American economy. It artificially inflated home prices and put an extra tax burden on American home owners in states like Texas with high property tax rates.
He just wants to complain about Biden.
FYI - new single-family home starts in America are trending down. Thanks to Biden’s policies, home starts in September 2022 are down ~18% year-over-year (vs 2021).
They have been for years…it just didnt happen under Biden. Americans want their.McMansions F starter homes.
There may also be relief for car buyers, used car prices are coming down…they were over inflated too
Im not a Biden fan but his approach to slow inflation by raising interest rates is 100% the right move.
It’s going to take a little time to fix this mess but as the OP ironically pointed out - It is working!
More bad irresponsible growth does NOT equal success.
You need to fix that faulty foundation first
Rates are higher worldwide. They were historically low for a few years, distorting the market. Don’t buy a house right now. Solves that problem for you.
The Disturbance thread on the economy has been pretty cool - starting a new thread just to bash on Biden is really pointless.
… or do buy a home right now IF you have a healthy down payment because home values are slowly coming back down to normal.
Simple business decision
Which would you rather have (same EXACT home)
Pay $400k @ 3% for 30 years
Pay $300k @ 6% for 30 years
Seems like option B lowered your liability by $100k right from the start. That’s an extreme example but we WILL start seeing that scenario playout as the Artificially Inflated prices are met with less home buyers on the market.
And, of course, Biden doesn’t control interest rates.
The Fed is independent. Many presidents have complained about the Fed in the past when they disagree with its policies.
Most people don’t pay cash, so you are wroooonnnnggg.
The housing industry is the largest industry. A 20% drop indicates a recession in on the way.
A recession will take care of inflation. The markets are cyclical, otherwise your portfolio would only head one way - up. You guys know these things, but hate the messengers.
Biden has not helped the inflation problem, throwing 3 trillion of spending on the fire.
A. Biden doesn’t control rates, at all.
B. Rates must go up to stop inflation.
This stuff is pretty basic.
Lots of people would’ve been on the streets without the money during COVID. Remember, the first part of that spending was under Trump. Biden has been in office for less than 2 years.
Did all the spending cause problems like inflation? Yeah, but it would’ve been worse without the extra cash. PPP loans to keep businesses afloat. Better for almost everybody.
Trump pumped all kinds of money into the economy which help set things in motion.
In the end, a lot of it was necessary. There are trade offs on everything. But it’s not the last trillion that caused inflation. It’s all the trillions.