Comment by tayo42 | Hacker News Reader

Comment by tayo42 | Hacker News Reader

This is something I hope the government can step in and help with. Maybe really low/no interest loans for first time home buyers so they can at least get into the market. Maybe that exists? Income limits need to account for up to date salaries. I'm not rich or wealthy just because I had a couple years of making 250k. I still have loans and im still burning up cash on renting. Taxes take away a ton of that income. Some guy making 70k making these rules probably thinks im rubbing shoulders with Leonardo Deicaprio at parties because making more then 200k is so unfathomable to the average person, it seems like wealth.

Rent situation needs help to. Were just throwing away cash on low quality rentals. A 2br in my complex over the last year is now listed at 1.5k more then a year and half ago. 3k to 4.5k. "Thats what the market wants" or something stupid is the reason, but these are not 1.5k better then it was before. How is this not price gouging? If i want to move I have to burn even more cash? Rent control keeps give me a rate under market now so there is no reason to move. Even that was some how allowed to be nearly a 10% increase. The only option is to buy to get away from this crazyness. Falling behind no matter what.

I don't get how these insane markets are allowed to exist with no regulation on necessary needs for people. IDK what else to do besides take my american cash somewhere where I am extremely ahead settle down there and chill.

If we don't expand the housing supply dramatically, additional subsidies to home buyers will lead to even more inflated housing prices, and transferring even more money from the working class (who pay taxes and want to buy houses) to old rich people (who own most of the desirable property).

If we were to expand the housing supply by 20% over the next 5 years I would expect to see house prices and rent crash to a more sustainable level.

The problem would be building 20%. That is a lot of housing. I’m not sure that even 5% would be possible with low interest rates. With interest rates where they are now, builders are going to be very conservative.

Maybe it’s time to admit that more entities besides private ones need to be building and supplying housing then? Maybe some things just aren’t well suited for market driven development.

There are far more empty houses in the US than there are homeless people. We do not need more houses, we need to stop allowing parasites to hold houses hostage for personal profit.

There are almost no empty homes anywhere near good jobs. Demand far outstrips supply, and putting all the greedy landlords in prison won't fix the imbalance.

I never said we should put them in prison

> Maybe really low/no interest loans for first time home buyers so they can at least get into the market.

These sort of "fixes" make the problem worse rather than better. By making it easier for people to buy high priced houses, it increases demand for high priced houses, and increases house prices.

Exactly what happened with college education expenses in the US.

And with subprime lending. The government force the banks to give those subprime loans, and that led to the housing crisis.

> Maybe really low/no interest loans for first time home buyers so they can at least get into the market.

One big reason homes are priced so high in places like the USA is because home loans are already government subsidized. When people think of what they can afford, they look at their net monthly mortgage payment less the income tax break. And prices seem to rise to meet whatever monthly payment buyers can afford.

> because home loans are already government subsidized.

Are they? Maybe Im more ignorant then I thought? Im still stuck looking at high intrest loans as a first time buyer who works in tech though?

Do you itemize your taxes? If so, your mortgage is being subsidized by the government.

no im single and rent (idk how to affordably buy a home, thats what my rant was about), i use standard deduction.

30 year fixed rate mortgages really aren't a market thing. They largely exist due to government support.

If you are getting a conforming loan in the US - chances are the federal government is buying that note via fannie or freddie and the bank simply services the loan for a fixed fee.

> Maybe really low/no interest loans for first time home buyers so they can at least get into the market.

These already exist. There are downpayment assistance programs that go as low as 0% down. We ourselves took advantage of FHA loans twice to buy homes.

If anything, they exacerbate the problem by throwing cheap money at a supply problem.

> downpayment assistance programs that go as low as 0% down.

I never understood these, you still have to make payments on the total loan though? 0% on a million dollar loan at 6% is a ton of money to pay every month. on top of taxes and expenses of owning a home.

You only pay the higher percentage on the amount of loan principle below 20%. So for 80% of our loan the interest rate is 2.25%, and then a few points on top of that for what we still own below the 20%.

Still a screaming deal - but a lot of restrictions on how big of a loan you can get and what kind of property you can buy with it.

ill dig into this. thanks! see theres a reason to rant on the comment section haha

Haha! Once in a million!

The advice I give all my friends - talk to a decent loan officer as soon as possible. Perhaps even years before you think you are ready!

The amount of knowledge you will get by Googling these topics is like looking through a straw. But a professional can lay out a bunch of options you never would have known you had.

it's obviously a huge help for people who can't easily fork out $200k in cash after tax for a downpayment. Which is only the majority of the population, even in the richest metros (e.g. SFBay has most families making less than $120k/year).

As to addressing the recently raised interest rate or not flooding the demand side with cheaper loans, I have no idea how to tackle all the evil in the world at once, but this particular form of help clearly addresses the barrier to entry in form of a downpayment, which is real.

Banging your head against an over-constrained problem is a exercise in futility. I found it easy to fall into the Trap of stubbornly doing it myself. If housing is a top priority for you like it was for me, I recommend doing exactly what you're considering. Move somewhere where you can get what you want. I moved off the peninsula and haven't regretted it for a minute

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