FSoA Sovereign Debt Hockey Stick Blues

[RE]

Model it in equations and see what happens with different policies.

One policy I would like to see is limiting the legal length of residential property mortgages to 20 years.

After WWII, the typical mortgage was 15 years and the price of a home 3X the average annual salary.  Today, mortgages are 30 years, and the price is 5X an average annual salary.  A Generation is usually about 20 years, the Boomers for instance were born between 1946-1964.

Shortening the length of time reduces the risk of your financial circumstances being significantly changed in either direction and makes the length of time you might own a home closer to how long you are paying it off.  Climbing the ladder and getting richer, you want to move to a more luxurious home, getting laid off and having to take a lower paid job you need to downsize.

This would limit the risk of people buying more house than they can really afford, when you take into account all the crap that can happen in an economy and people's lives over 30 years.

Next policy that is important is if the Private Sector builders are not building Starter Homes for first time buyers, the Goobermint should be building them.

Builders say the combination of land, labor, and material costs makes affordable homes impossible, and only more expensive models offer enough of a profit margin.

Not building them at all is simply not a viable option.  It just results in homelessness.    If it has to be subsidized, so be it.  Capitalism doesn't provide a viable means of making a profit from building affordable houses.  The Builders themselves say this.

These two policy changes IMHO would go a long way toward resolving the homeless crisis.

https://archive.curbed.com/2018/4/10/17219786/buying-a-house-mortgage-government-gi-bill

RE

[K-Dog]

Not building them at all is simply not a viable option.  It just results in homelessness.    If it has to be subsidized, so be it.  Capitalism doesn't provide a viable means of making a profit from building affordable houses.  The Builders themselves say this.

Americans are patriotic and will happily experience homelessness and deprivation before they see any issues with the system.

3000 square feet new homes are selling for two million a mile from me.  These homes are 8x the price what they would have been forty years ago here.  Totally unaffordable except for the greedy skim the cream off the top capitalist.  Most fools call this progress.  And it has been for decades, Affluence moves in and drives the locals away.  It is an old American story.  It is the American progress fable.

Most Americans would flip out if they knew how many Chinese nationals are moving in to keep the price up.  I'm not going to tell them.  What goes around comes around.  It would be fitting if the new Chinese lions were replaced by concrete buffalo at the end of the driveways.  The joke would be so subtle most people would not get it.

 

This will be Seattle in 20 years. 

You will not have to ask where Chinatown is. 

Noah Cross: Exactly what do you know about me? Sit down.

Jake Gittes: Mainly that you're rich, too respectable to want your name in the newspapers.

Noah Cross: Of course I'm respectable. I'm old! Politicians, ugly buildings and whores all get respectable if they last long enough.

From the movie, Chinatown.  Noah Cross is an average guy now.  What goes around comes around.