What’s Happening in the Housing Market? Rising Rates, Record Low Sales, and Election Impact
Published: 2024-10-28
Status:
Available
|
Analyzed
Published: 2024-10-28
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 0
Prediction
Topic
Status
Both Kamala Harris and Donald Trump have proposed plans to address the housing market, which will be relevant following the upcoming election.
"And number three, we have an election right around the corner. And Harris and Trump both have their own proposals on how to fix the housing market."
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On September 17th, 30-year fixed-rate mortgages were available for just under 6%.
"On September 17th, if you wanted to get a 30-year fixed rate mortgage for the first time, you could get a mortgage just under 6%."
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On September 18th, the Federal Reserve announced a 50 basis point (0.5%) interest rate cut, indicating a less aggressive approach to rate reductions.
"On September 18th, one day later, the Federal Reserve Bank began cutting interest rates. They announced that they were going to cut interest rates by 50 basis points, meaning 0.5%, and that they were not going to be as aggressive with interest rate cuts as some might have liked."
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Home sales in September reached their lowest point since 2010.
"In fact, just a few days ago, we got a new report saying that home sales, the number of home sales happening in September fell to the lowest number we have seen since 2010."
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Home prices have increased significantly more than incomes over the past five years (50-65% vs. 20%).
"home prices have gone up by 50 to 65% in the last 5 years while incomes have only risen by about 20%."
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Kamala Harris has proposed providing up to $25,000 in down payment assistance for first-time, first-generation homebuyers.
"Harris has proposed giving out up to $25,000 in down payment assistance to firsttime first generation home buyers."
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Kamala Harris has proposed tax incentives for home builders to encourage the construction of new homes and increase supply.
"she has proposed offering a tax incentive to home builders to build new homes to increase the supply of homes."
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Donald Trump has proposed tax incentives for home builders and the reduction of construction regulations to facilitate home building.
"he has proposed tax incentives for home builders to continue building homes while also cutting unnecessary regulations on home construction to make it easier for home builders to go out and build homes."
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Donald Trump has suggested making federal land available for residential construction.
"he's also talked about making some federal land available for residential construction."
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Donald Trump has proposed to ban undocumented immigrants from obtaining mortgages or housing.
"he's also talked about fixing the housing market by banning quote undocumented immigrants from getting mortgages or access to housing."
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Providing down payment assistance or 'free money' for home purchases could increase demand and potentially drive up home prices.
"if you give people money to buy homes, free money, then there's a chance that home prices could go up even more because what are we doing when we give people access to free money to buy homes? Well, of course, you increase demand. And as you increase demand, that can help push home prices higher"
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A potential consequence of $25,000 down payment assistance is that buyers might bid up home prices by that same amount.
"if you give people $25,000 to go out and buy a home, is there a chance that people will then start just paying 25 more $25,000 more to go out and buy that same home?"
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Offering tax incentives to home buyers carries the risk of individuals purchasing homes beyond their financial capacity.
"If you give tax incentives to home buyers, are there risks? Absolutely. Because that might mean that people are buying homes that they can't afford."
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Reducing regulations on home construction could lead to builders constructing homes in inappropriate locations or compromising on building standards.
"If you cut unnecessary regulations on home construction, that might mean that builders start building homes where they shouldn't, how they shouldn't, they start cutting corners."
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