The best take I've heard on this is that a 50-year loan is basically a hedge against the dollar. If you think the dollar will tank (which we know it will), it's actually not a bad bet to get a 50-year mortgage since it will inflate away to almost nothing.
Of course, that assumes that you have the flexibility to take a 50-year bet and that you'd be able to survive mortgage payments long enough during multiple likely financial crises to take advantage of it, but in principle, it's sound.
If you think the dollar will tank (which we know it will), it's actually not a bad bet to get a 50-year mortgage since it will inflate away to almost nothing.
Except, and this is a big except...you're paying almost the same amount anyway, on the hook for longer, and that's not taking into account that the prices will soar to balance the "savings."
This will make housing more out of reach for everyone, no matter what the dollar does. They're just trying to keep the bubble intact, instead of letting prices naturally drop and letting young Americans buy houses again.
The 50 year mortgage is an abomination, no matter how you slice it. And, since we're all in the same economy, it fucks us whether you choose to take it or not. Thanks, government.
Exactly this, monthly payment bros (people who think only in payment terms) will just buy increased prices to the point that the 50 year bet against the dollar barely pays out. It'll all be priced in seconds after it is made official.
Current houses will be even more out of reach, boomers and banksters even richer.
Anyone who thinks this is a choice is missing the point. Because of how the average person thinks, and how the market works, a 50 year mortgage will absolutely fuck any chance of a good 30 year mortgage now.
If this goes through, we'll very shortly be yearning for the "good old days" of a 30 year mortgage.
Just like how almost no one buys homes outright anymore, or gets a ten year mortgage or anything. Those aren't things anymore, by and large.
The average mortgage duration is 30 years. The new average will be 50. We're all fucking fucked.
And the really infuriating part is that they could release pressure on the housing market tomorrow if they actually cracked down on illegal immigration. They are doing this in part so Trump can avoid keeping another separate promise he campaigned on.
We're getting fucked so hotels and farmers can pay below market for their labor, since all that labor needs to live somewhere.
Aren't they? I was, and still am, offered a 15 year mortgage on my home both on the buying and currently on the possibility of a refinance. If I had a job paying like 10$ more an hour I'd take it even, because it has a much lower rate.
I'm not disagreeing with you guys that 50 is a bad thing, but 15 year ones are pretty commonly available and people just don't do their research to look into getting one because "lower monthly payment" is basically the only thought process people have when buying. The guys financing you aren't going to remind you of the option that loses them a lot of money.
This will make housing more out of reach for everyone, no matter what the dollar does. They're just trying to keep the bubble intact, instead of letting prices naturally drop and letting young Americans buy houses again.
Yeah, the only way this "works" is if housing prices significantly beat inflation. So the only potential winners would be the people who beat the wave of homeowners that will further drive up pricing.
The best take I've heard on this is that a 50-year loan is basically a hedge against the dollar. If you think the dollar will tank (which we know it will), it's actually not a bad bet to get a 50-year mortgage since it will inflate away to almost nothing.
Of course, that assumes that you have the flexibility to take a 50-year bet and that you'd be able to survive mortgage payments long enough during multiple likely financial crises to take advantage of it, but in principle, it's sound.
Except, and this is a big except...you're paying almost the same amount anyway, on the hook for longer, and that's not taking into account that the prices will soar to balance the "savings."
This will make housing more out of reach for everyone, no matter what the dollar does. They're just trying to keep the bubble intact, instead of letting prices naturally drop and letting young Americans buy houses again.
The 50 year mortgage is an abomination, no matter how you slice it. And, since we're all in the same economy, it fucks us whether you choose to take it or not. Thanks, government.
Exactly this, monthly payment bros (people who think only in payment terms) will just buy increased prices to the point that the 50 year bet against the dollar barely pays out. It'll all be priced in seconds after it is made official.
Current houses will be even more out of reach, boomers and banksters even richer.
Yup. Very sad, and I'm absolutely enraged.
Anyone who thinks this is a choice is missing the point. Because of how the average person thinks, and how the market works, a 50 year mortgage will absolutely fuck any chance of a good 30 year mortgage now.
If this goes through, we'll very shortly be yearning for the "good old days" of a 30 year mortgage.
Just like how almost no one buys homes outright anymore, or gets a ten year mortgage or anything. Those aren't things anymore, by and large.
The average mortgage duration is 30 years. The new average will be 50. We're all fucking fucked.
And the really infuriating part is that they could release pressure on the housing market tomorrow if they actually cracked down on illegal immigration. They are doing this in part so Trump can avoid keeping another separate promise he campaigned on.
We're getting fucked so hotels and farmers can pay below market for their labor, since all that labor needs to live somewhere.
Aren't they? I was, and still am, offered a 15 year mortgage on my home both on the buying and currently on the possibility of a refinance. If I had a job paying like 10$ more an hour I'd take it even, because it has a much lower rate.
I'm not disagreeing with you guys that 50 is a bad thing, but 15 year ones are pretty commonly available and people just don't do their research to look into getting one because "lower monthly payment" is basically the only thought process people have when buying. The guys financing you aren't going to remind you of the option that loses them a lot of money.
I got a 15 year mortgage in 2021 at a 2.3 interest rate and I feel like I jumped into the last lifeboat off the Titanic.
Yeah, the only way this "works" is if housing prices significantly beat inflation. So the only potential winners would be the people who beat the wave of homeowners that will further drive up pricing.