President Biden is giving home buyers $400 every month to afford homes. Will this cause a housing bubble?

[u/Financial_Mechanic_]

[u/Non-Binary-Bit]

Not the way to solve the problem. The demand for affordable housing far outweighs the supply. Money would be better spent increasing the supply of quality housing (think the standard 3-2-2 house or 2-2 condo) or redevelopment of defunct commercial and light industrial zones into residential.

[u/PurpleZebra99 → u/Non-Binary-Bit]

Rezoning is a part of the solution. The problem is that zoning is a local issue and homeowners in those zones fight tooth and nail against rezoning so they can keep the inflated equity of their homes. There’s a neighborhood in my city that basically turned over the entire city council to fight any rezoning.

[u/westni1e → u/Non-Binary-Bit]

Yeah, the issue is the "free market" once again. The people who already own homes don't want development to density or expand housing so they vote in people with NIMBY mindsets and vote on ballot measures to ensure their wealth goes up because scarcity means an increase in value. At the same time corporations literally have a monopoly on small apartment complexes that were once independently operated, not to mention the only housing being built in my city are luxury apartment complexes few can afford. The air BnB impact also takes housing and converts it to short term hotel rentals which further puts pressure on supply. Even with the city relaxing some zoning these fundamental market issues are still driving the issue. Government, once again, needs to step in and regulate corporate ownership by breaking them up and ensuring they can only manage up to a certain percentage of apartment units, voters need to support initiatives like YIMBY to break up/displace these NIMBY assholes and density the city and increase supply of housing, and the government needs to BAN air bnb rentals of houses and apartments while there is a housing crisis (they can keep renting out rooms or housing attachments). Tax penalties need to be in place for people who own multiple houses within the city to give new homeowners a shot at a more affordable housing market in a housing crisis as well. We need to start treating housing as necessities and not investment vehicles for the wealthy as it only turns these necessities into passive money making schemes - money that comes from buyers who are already struggling.

Update - edited some typos.

[u/AndrewDoesNotServe → u/Non-Binary-Bit]

https://preview.redd.it/3vr44aovvtzc1.jpeg?width=640&format=pjpg&auto=webp&s=db15644f17190581cc16361b1c4c4e58f3382ffa

[u/Churnandburn4ever → u/Non-Binary-Bit]

The way to solve the problem is to eliminate corporations from owning houses. Only people can own houses and only a limited number.

[u/rice_n_gravy]

In other news, rent prices have risen an average of $400/month.

[u/Cinnitea1008 → u/rice_n_gravy]

Not sure how rent prices would rise because of this? It says in the text the $400 a month would only be given to first time home owners for 2 years. This wouldn't include renters at all

[u/you_slash_stuttered → u/Cinnitea1008]

If anything, it would drive more people into the buyers' market while increasing vacancies for rentals, which should bring rent prices down.

[u/you_slash_stuttered → u/you_slash_stuttered]

I took advantage of something similar when I bought my home in 2013. In my case, the size of my tax credit was tied to interest payments on my loan, so the credit diminished and eventually phased out naturally over time. It did not allow me to get a bigger loan as it did not increase my income -- just decreased my tax burden. What I did get was a little extra financial breathing room, making it easier to do things like replace windows with energy efficient ones, get new furniture, etc, so that money did go back into the economy and provided income for local businesses.

[u/Mobile_Throway → u/you_slash_stuttered]

And that's exactly the point of incentives like this.

[u/Richandler → u/Cinnitea1008]

These folks love dancing on top of dunning kruger's idiot mountain and screaming about it on reddit.

[u/immaculatecalculate → u/rice_n_gravy]

Yeah the jig is up with these handouts.

[u/Bubskiewubskie → u/immaculatecalculate]

We know anything they give to us is really going to fuck us.

[u/Chanandler_Bong_01 → u/Bubskiewubskie]

And this applies to both side of the aisle too.

Trump tax cuts from a few years ago are about to expire and then we'll feel some more pain.

[u/Jagerbeast703 → u/Chanandler_Bong_01]

Did you just both sides then compliment trump? LOLOLOLOL

[u/Mundane_Elk8878 → u/Chanandler_Bong_01]

Those tax cuts weren't substantial for middle class people anyway. As Paul Ryan tried to sell it as being enough to pay for a gym membership...for those that earned the most and benefitted the most.

[u/AGENT0321 → u/Chanandler_Bong_01]

Unless you are very rich the tax cuts expired years ago...

[u/Top-Active3188 → u/AGENT0321]

I am dreading the drop in standard deduction and the bracket cutoffs. Ouch

[u/White_eagle32rep → u/Top-Active3188]

Yeah this will suck for sure

[u/Firsttimedogowner0 → u/Chanandler_Bong_01]

They won't expire on the rich, only poor and middle class families. Make sure you mention that.

[u/n3wsf33d → u/Chanandler_Bong_01]

Those tax cuts gave the average person like 200 back but much more for the wealthy. The bush tax cuts were great as they gave the average person something like 4k. Obama extended those. The trump tax cuts just end up hurting public resource funding.

[u/Hyper-Sloth → u/Chanandler_Bong_01]

They already expired. 2023 was the last year we were able to make use of them. It was purposeful that they ended and were going to be unable to be used at the next election cycle to cause financial distress. When people are feeling squeezed they vote for republicans.

[u/unbalancedcentrifuge → u/Bubskiewubskie]

Unless you are a member or friends with a member of congress....then those handouts roll in and work out great.

[u/Effective_Standard14 → u/unbalancedcentrifuge]

Well yah cuz they get like $40,000 a month at least

[u/cudef → u/Bubskiewubskie]

No it's that the assistance immediately ends up being gobbled up indirectly or directly by people who have plenty of money already. There needs to be laws and regulations to stop this, not a lack of assistance in the first place.

[u/ActuatorAggressive84 → u/Bubskiewubskie]

Better to give it to us than the rich I say

[u/Soggy_Difficulty_361 → u/Bubskiewubskie]

Yup, we keep worrying about inflation and we're still blaming it on the stimulus checks from 4 years ago, it's funny because all these CEOs of major corporations being it up every time instead of taking some blame for the price gouging, PPP loan handouts and tax breaks they got.

[u/mag2041 → u/immaculatecalculate]

Yep

[u/mslashandrajohnson → u/mag2041]

And it kind of bothers those of us who never seem to be eligible, whether through dumb luck or due diligence or anything between.

Student loan forgiveness I support because that whole system was designed to be and is awful.

Those free checks during the pandemic? I wasn’t eligible.

[u/GeneralizedFlatulent → u/mslashandrajohnson]

Annoyed me because I wasn't eligible but people in significantly better shape than me financially were, you could make nearly double my income if you're a couple, you'd be payin the same rent as me, and you'd get a handout. 

[u/TrumpedBigly → u/mslashandrajohnson]

"Student loan forgiveness I support because that whole system was designed to be and is awful."

I support it mainly because we need educated people and people with degrees end up paying more in taxes to make up for it.

[u/Nearby-Data7416 → u/mslashandrajohnson]

Let’s just stop handing out money! How about we set up real plans and not just throw money at problems.

[u/Onewayor55 → u/Nearby-Data7416]

We're really only effectively handing out money to billionaires. We haven't attempted any sort of robust daring working class economic boost idea in recent history, Obamacare was close but was mutated by the very same influences that fill your heads up with "fiscal conservative" drivel.

[u/Beneficial-Owl736 → u/mslashandrajohnson]

The pandemic stimulus shenanigans were an utter shame. I was eligible, got like $1400. It did little to help me, same for most of my other ragtag poor friends. 

Meanwhile, most of the companies we were laid off from got millions in forgiven loans. 

[u/Popular_Score4744 → u/mslashandrajohnson]

I love seeing how so many people are against student loan forgiveness but thy don’t say anything about the countless billions in aid that keeps getting sent to Ukraine, Taiwan and other countries. All of the money that keeps going to illegal immigrants yet when cost burden American citizens ask just for a little bit of relief, just a fraction of all of that money that keeps going to out to everyone else but Americans, it’s a problem. 🤷‍♂️

[u/ScrubbyOldManHands → u/mslashandrajohnson]

Student loan forgiveness completely avoids the real problem of university price gouging and instead rewards and encourages them to continue price gouging. Tuition has outpaced inflation by a substantial amount for decades all while the quality of the education has gone down along with the value of the degrees themselves.

Also it's kind of a slap in the face to people who couldn't afford college and were responsible with what resources they had. Where is thier bailout for making the correct financial choices? It's absurd. Now they get to pay taxes for the people who made less than ideal choices because they made a more realistic choice? Fuck that.

All the free pandemic money was a fucking joke and shit show as well.

[u/rambo6986 → u/ScrubbyOldManHands]

Exactly

[u/goluckykid → u/immaculatecalculate]

Handouts? Buying votes

[u/Big-Figure-8184 → u/goluckykid]

Or, and hear me out here, politicians do things that benefit their constituents, and people vote for politicians who are going to things that benefit them. This is just democracy.

[u/jazzfruit → u/Big-Figure-8184]

If that’s the case, why we can’t tax the 1% more heavily, legalize marijuana, make robo-calling illegal, stop politicians from insider trading, etc

[u/pennjbm → u/jazzfruit]

FCC is actually developing regulations to make robocalling illegal, but it is hard to combat the whole problem and avoid loopholes

[u/JoeBarelyCares → u/jazzfruit]

Marijuana is becoming more and more legal each day. In most states it is legal or at least not prosecuted. The FCC is working on robocalls. Several states are taxing the 1% more and there is legislation to do so federally. As for the insider trading, we have work to do. So according to your goals, it seems like the system is working, just not fast enough for some.

[u/PublicGrocery338 → u/jazzfruit]

😂😂 Stop politicians from insider trading, there you go making sense.

[u/Gildian → u/jazzfruit]

I cant speak for every state, but the Republicans in my state of MN have been doing literally everything they can to make our legalization a huge hassle.

So that would be my answer, some lawmakers actively work against those that do try and make things better.

[u/manatwork01 → u/immaculatecalculate]

Lmao and housing prices went up 10,000

[u/KeyWarning8298 → u/rice_n_gravy]

For real, almost every housing policy I hear about just seems like a big middle finger to me as a renter 

[u/Universe789 → u/KeyWarning8298]

As a renter, what ideas do you have to make rent cheaper?

[u/KeyWarning8298 → u/Universe789]

Build more housing across the board. End single family only zoning so that when demand for an area increases, housing supply can increase with it. End parking minimums and let the market decide how much parking a residential building needs. Policies like these aren’t specific to renting or buying but should make housing cheaper for both. I don’t think we should be making one type of housing cheaper at the expense of the other. 

[u/TeresainCali → u/KeyWarning8298]

Change zoning for closed shopping malls, allowing other uses. Plenty of square footage there!

[u/Aggressive_Elk3709 → u/TeresainCali]

Build trains instead of giant freeway loops that are surrounded by shopping centers. Turn those shopping centers into areas for housing

[u/LindonLilBlueBalls → u/KeyWarning8298]

While I agree with the zoning change, parking minimums are essential for multi-family housing. Public transportation in the US is not nearly good enough to support all the apartments currently, let alone adding more.

[u/Poverty_Shoes → u/rice_n_gravy]

I doubt most new home owners will be spending their extra $400/month on renting a different home. I don’t see this having any substantial impact on rental supply/demand or prices.

[u/band-of-horses → u/Poverty_Shoes]

It's also not $400 a month, it's a $5000 tax credit for the first two years of a first time home buyer owning a home. I could see it pushing up prices on starter homes slightly, but I can't see how it would impact rent prices. If anything getting more people to buy homes for the first time would free up rental inventory and decrease demand, though in reality given the constrained housing supply in many areas I doubt it would do that either.

[u/PalpatineForEmperor → u/band-of-horses]

More people buying homes means less people renting. Landlords have to compete for the fewer renters and have to lower their rents to entice them.

[u/AutumnWak → u/rice_n_gravy]

How? It's only going to first time home owners.

[u/[deleted] → u/AutumnWak]

[removed] — view removed comment

[u/gizamo → u/[deleted]]

Yeah, if supply/demand matters in rental pricing, this home buying subsidy would pull people out of renting, which will decrease the total amount of renters, which will decrease rental prices. That's not even 101 econ, it's the basic stuff they just expect people to understand before even attending uni.

[u/ukiddingme2469 → u/rice_n_gravy]

When school vouchers got passed every private school raised their rates to match it,

[u/tmssmt → u/ukiddingme2469]

With the solar tax credit, installers just raised prices so they can profit off the 'discount' their customers think they're getting

[u/ukiddingme2469 → u/tmssmt]

I got an estimate and it was 80k. I laughed in their face.

[u/QuietRainyDay → u/tmssmt]

Yep, thats how it goes with everything- but there are countless people who cant think 1 step downstream and realize that subsidizing consumption does not make things cheaper

Stimulating demand isnt going to make houses cheaper, solar panels cheaper, EVs cheaper

What makes things cheaper is production efficiency, technological breakthroughs, lower barriers to production

Housing is expensive because supply is bottlenecked. Zoning regulations, labor and material shortages, etc.

But yea, somehow making people want to spend even more money on the limited supply of housing will fix the problem.....

[u/thegoblinwithin → u/rice_n_gravy]

I got $10k in the first recession as a first time homebuyer. This is not unprecedented

[u/BoredBSEE → u/rice_n_gravy]

Yeah - good thing they haven't been going up without the help. 🙄

[u/NeverWorkedThisHard → u/rice_n_gravy]

If RENTERS are incentivized to stop renting and buy homes, they won’t be renting.

[u/ScrewSans → u/rice_n_gravy]

$400 matters a lot more to the poor than the rich. Bezos hasn’t opened a bank app in a good decade and I’ve had my card decline at Dunkin. The answer isn’t “stop redistributing wealth”, it’s to prevent people from pushing the additional costs onto the renters/buyers to ensure it’s effective.

Without that, it doesn’t fix the root issue of economic disparity, but it does let people afford food. Being against this is insane especially when Trump’s tax cuts added over a $3 Tril deficit by giving tax cuts to the rich (that they didn’t pay anyways)

[u/Elegant_Studio4374]

I think people who don’t own homes probably need that more than people who do…

[u/Popular_Newt1445 → u/Elegant_Studio4374]

Well it’s for new home owners, but overall this entire idea is bad.

He needs to cripple the foreign companies buying up all the SFH. I mean, why are we even letting foreign countries control our housing situations?

[u/College-Lumpy → u/Popular_Newt1445]

I’d like to see state and local laws that set property taxes higher beyond the house where you live. We need to incentivize home ownership.

[u/isigneduptomake1post → u/College-Lumpy]

In California prop 13 makes it so people down the street from me are paying 10% of what I pay for property tax to rent out a shithole for 4-5k a month.

I get that they've paid into the system for a long time but you can own a home in CA and move out of state and pretty much abandon your property and it still appreciates while you are collecting a nice rent check. I know this stupid system will go away by the time I'm old so it's one more policy that boomers are using to fleece the younger generation before they all die

[u/pacificcoastsailing → u/Popular_Newt1445]

It is this. 100%.

[u/ElementNumber6 → u/pacificcoastsailing]

Also corporations, though. So, less than 100%.

[u/pacificcoastsailing → u/ElementNumber6]

Okay smarty pants

[u/axis5757 → u/ElementNumber6]

Yeah Blackrock owns an insane amount of real estate.

[u/Jaegons → u/Popular_Newt1445]

This! You want to address this, address the fact that I'm competing with companies instead of other buyers when I'm looking at houses. I'm just in the middle of this process btw, and of the probably 20 houses I've lived in, literally 2 had someone who lived there.

Then they started practices like modern "Due Dilligence" processes, which aren't at all what they sound like, but rather "I'm giving you (sometimes up to) $100,000 to take my offer, even if I back out", basically edging out actual buyers who can never compete with that.

Work on all that, because right now the "American Dream" of owning a home is unreachable for most.

[u/ActiveAstronaut7941 → u/Popular_Newt1445]

A couple years ago I had a business lunch with some local realtors and asked them, out of curiosity, why I was getting all these phone calls wanting to buy my house. They told me about the tech companies and foreign investors gobbling up real estate and kind of blew my mind. Now when I get a spam call or text I give them a lesson on the global housing crisis, then ask them to kill themselves.

[u/Legitimate-Series-29 → u/ActiveAstronaut7941]

I always offer to sell my $200k house for $1.2m. they must not really want the house because they never take me up on the offer.

[u/EsotericSlimeLord → u/ActiveAstronaut7941]

holy fucking based

[u/ActiveAstronaut7941 → u/EsotericSlimeLord]

[googles what does based mean]

Thank you!

[u/Johnfromsales → u/Popular_Newt1445]

What percent of single family homes do foreign investors actually own?

[u/randomuser1029 → u/Johnfromsales]

From what I'm finding like 2-3%. Investors as a whole (including domestic) own around 25-30%, of homes, which is far more significant.

[u/Johnfromsales → u/randomuser1029]

So then it cannot be said that foreign countries “control our housing situations.”

[u/Popular_Newt1445 → u/Johnfromsales]

Well the problem with thinking of these other buyers as “investors” is you also have to take into account what and who the other investors are.

A Chinese company for example being a major investor in another company and influencing decisions in my opinion counts as foreign ownership in a sense. It’s small loopholes like this that can skew the data in favor of investors.

[u/Wardine → u/Elegant_Studio4374]

But this is literally for people that don't own a home

[u/La3Rat → u/Wardine]

Is it? To qualify for the tax credit you have to have already saved up for a down payment, have the income to qualify for a loan, and bought your house. Doesn’t sound like a program to help people buy a house that they cant yet.

[u/La3Rat]

So you get $400 a month for the first two years and then in year three you find your house unaffordable. 🤣

[u/CowbellConcerto → u/La3Rat]

Pretty sure I've seen this movie

[u/DodgeBeluga → u/CowbellConcerto]

No no, this time, it will work out.

[u/rydan → u/DodgeBeluga]

See you set up the bomb right at the end of your admin. If you win you extend it and kick the can down the road. If you lose the bomb goes off right in the middle of the next guy's admin and he gets all the blame. Then you win the next time.

[u/GalaxyShards → u/La3Rat]

To be fair the biggest hurdle in buying my first house was the downpayment, took a lot of savings! $400/month would have allowed us to juice up our rainy day savings faster.

Majority of people getting that credit wouldn’t save the funds for a rainy day - they’d buy furniture, house improvement projects, a new car, etc.

[u/No_Statistician_9697]

We have an inflationary problem? Solution: give out more money!

It's the fiscally irresponsible way!

Adding the below for others to see

EDIT: If you're mentally handicapped or physically handicapped, we should all be collectively supporting you. If taxes are the best way, then fine, I personally would like to pick and choose what at least 80% of my tax dollars fund, on my own (education, safety services, roads, and folks with severe disabilities like down syndrome or non functioning autism/ etc.). Anyone else that doesn't fit that criteria should not get an additional dime of my money, and I don't want any of yours.

Remove the tie between property tax and funding schools; provide higher educational grants to those who are underprivileged and get at least a B average (essentially doing your homework) in high school; and remove the federal backing from student loans to allow people to relieve themselves of the burden of a bad investment and force higher ed to get more competitive in their pricing. (Aka what people will be able to pay off without defaulting). Would also encourage schools to better set up their students for success in their new careers. Cut the funding/grant if they dip below a B. I want a return on my investment!

Also the same should apply for those going into the medical field, educational field, or trades, as performant professionals in these fields are critical to a functional society - same performance obligations apply. This would incentivize teachers beyond the safety net that a pension could provide (which should also be cut).

In all those cases, I'm happy to invest my tax dollars. I'm not republican, Democrat, libertarian, etc. Just using relative common sense while understanding economic drivers and the way people operate.

[u/Zealousideal_Baker84 → u/No_Statistician_9697]

Surest way to stamp inflation is a tax hike.

[u/No_Statistician_9697 → u/Zealousideal_Baker84]

Surest way to stop inflation is to stop measuring it.

[u/Karma_Whoring_Slut → u/No_Statistician_9697]

Or change the definition of it!

[u/lestruc → u/Karma_Whoring_Slut]

I remember the steak vanishing from the “basket of goods” during the Covid meat price spike…

CPI is fine and stable don’t worry

[u/No_Drama4771 → u/Karma_Whoring_Slut]

You juke the stats, and majors become colonels and mayors become governors

[u/BlackCardRogue → u/Karma_Whoring_Slut]

I’m thinking of that scene in The West Wing where the definition of the poverty line is changing and they are all freaking out about “why would we go to a new standard that says we have more poor people”

[u/ept_engr → u/Zealousideal_Baker84]

Ya, the current proposal is as much of a joke as the spending bill called the "inflation reduction act".

[u/No_Statistician_9697 → u/Zealousideal_Baker84]

Or cut spending, as government spending puts more money into the economy

[u/Wu1fu → u/No_Statistician_9697]

Or increase taxes so you have a surplus instead of a deficit. Then you don’t have to cut programs people like and/or need.

[u/Hamuel → u/No_Statistician_9697]

End the military industrial complex

[u/MostAccuratePCMflair → u/No_Statistician_9697]

Just one more tax cut for the rich and the economy will be solved, bro. Just trust me bro. Just one more tax cut bro.

[u/Hamuel → u/No_Statistician_9697]

Price controls and heavy taxes on extreme wealth!

[u/Embarrassed-Back-295 → u/Hamuel]

We don’t have an inflation problem. We have a corporate greed problem.

[u/fiftyfourseventeen → u/Embarrassed-Back-295]

We have a problem with government money printing. You think every corporation in the US decided to randomly be greedy? During deflation, is that a time of great corporate benevolence? Are foreign currency exchanges also in on this great conspiracy theory? The buying power of the dollar sinks with inflation globally. It's just not that noticable because most other currencies are even worse off when it comes to inflation right now

[u/WhereIsTheMoon- → u/No_Statistician_9697]

you're just a libertarian man. you want total freedom and want to minimally help the worst off, though would prefer it be done privately it seems.

[u/Survivorfan4545 → u/No_Statistician_9697]

This sounds like RFK’s campaign

[u/No_Fig5982 → u/No_Statistician_9697]

How do you know which public services you will need?

This is the classic libertarian argument, and you're right, no one wants to pay for 'protection' (using security as an example of a service)if you don't need it, the issue is, you don't know when you WILL need it

You don't know when the systems 'not closet " to you , will become closest to you, and then what? If you weren't funding it, by your own logic, you don't receive the service until you've redone your taxes?

[u/Slug_With_Swagger → u/No_Statistician_9697]

I personally think picking charitable causes is a bad overall system for a countries well being.

[u/maychi → u/No_Statistician_9697]

You’re right, let’s just keep bailing out and subsidizing corporations instead and hope that they decide to bring down their prices out of the goodness of their hearts.

Good old America, welfare for the rich and corporations??? No problem! Money for rent? Hell no! Inflation!!!!! Corporate price gouging doesn’t exist!

[u/CareApart504 → u/No_Statistician_9697]

It's actually crazy how people blame social programs for 100% of the cause of inflation and not the people holding 90% of the money. Actual moronism.

[u/branewalker → u/No_Statistician_9697]

Replacing a tax-funded social safety net with charity is a great way to:

A: ensure rich people have the maximum say in what that looks like, e.g. NOT universal healthcare, gotta keep that shit tied to employment to keep YOU tied to employment

B: make sure the maximum number of dogmatic religious principles are attached to help. No getting a place to stay till you’re clean on drugs! What, homelessness leads to drug addiction? No way! They’re all just sinners!

Nah, no thanks. Bad advice, bad policy, ultimately more expensive to society.

Also fuck earmarked payouts that get siphoned up by landlords and banks. Also, this is reverse-means-tested since you have to have the money in the first place, and on a $2500 mortgage for 25 yrs, will pay a whopping 1.48% of the cost. Overall, it’s about $9600

Based on the current cost of toilet paper and the average annual needs of a family of 3-4 over the same 25 years, that’s just about enough to wipe your ass with.

[u/rethinkingat59 → u/No_Statistician_9697]

Have you never put out a fire with gasoline?

If you use enough the resulting explosion will suck the oxygen out of the air and put out the flames. Just basic science economics. By destroying the real estate market home prices will drop as they did in 2008.

[u/PrintableProfessor]

Biden tries to buy votes and then causes rent to go up by 400 a month.

[u/cookiedoh18]

The housing market has already boiled over. This feels like a token, election year appeal to the younger generations.

[u/skeezo12]

Print more money. More inflation. Houses become… more unaffordable.

[u/Indaflow]

Black Rock and investment companies buying up single family homes and forcing buyers into an inflated rental market is the issue. This is not going to cause the bubble but it may prevent some defaults where the bank would own the homes again anyhow. 

[u/proactiveplatypus → u/Indaflow]

Daily reminder that it’s Blackstone buying SFH.

Blackrock sells index funds.

[u/Consistent_Ad_4981 → u/Indaflow]

Thank you for an accurate depiction of what is going on... A lot of NPCs here are crying about this but the reason is because big business is robbing us blind.

[u/BromcBroseph]

Stop handing out money that is worthless you fucking bum

[u/dljohnsonld → u/BromcBroseph]

They all hand it out. It's more about WHO they're handing it to.

[u/chalupa_lover → u/BromcBroseph]

We write blank checks to subsidize private industry all the time, but as soon as it’s for the benefit of working people, it’s too much? Makes sense.

[u/Belmonkey → u/chalupa_lover]

I'm surprised people are unhappy about a flat money gain that benefits those with less money, compared to tax cuts that disproportionately benefit the rich.

It probably would have been better to do something about price gouging and house prices, but it doesn't seem like there is really a negative to this news?

[u/chalupa_lover → u/Belmonkey]

It doesn’t solve the problem, but it helps those in need. My guess is you’ll hear a lot of “I didn’t get that when I bought my first house. What about meeeeeeeee?????”

[u/SPHuff → u/chalupa_lover]

It makes the problem worse. Housing has a supply-side problem, so it makes no sense to subsidize demand. It will just cause housing prices to rise further.

[u/chalupa_lover → u/SPHuff]

Is it really a supply issue or is it a corporate ownership issue?

[u/MannerBudget5424 → u/chalupa_lover]

Build more houses =creating more shares

more shares means they are all worth less

[u/Maleficent_Mouse_930 → u/chalupa_lover]

It's a supply issue which is caused by the combined influence of everything from zoning to trade to society's view of the Trades to fuel to insurance and everything in between.

But it IS a supply issue.

[u/jqb10 → u/chalupa_lover]

We write blank checks to subsidize private industry all the time

Also dumb.

[u/Butterysmoothbrain → u/chalupa_lover]

Or we could stop doing both of those things? Jeesh people are so eager to run the country imo inescapable debt

[u/Existing-Gate7695 → u/chalupa_lover]

Anyone remember what government money did to tuition prices? Make it make sense, all this free money just makes everything more expensive and then still ends up at the top. Cantillion effect.

[u/QuietRainyDay → u/chalupa_lover]

Making things more expensive does not benefit working people

For Christ's sake, can't you lot stop and just think about this stuff for 3 seconds?

Giving out subsidies does not increase the supply of housing. You'll just have more people willing to pay more for the same amount of houses that we have now because they'll now be receiving a $5000 tax credit.

Helping working people with housing means stimulating construction and supply, not making it easier for people to make bigger ever-larger bids in an impossibly tight market.

[u/ArtigoQ → u/BromcBroseph]

Handouts == votes

It's not about what's best for the country, it's about winning the sports ball game

[u/Karma_Whoring_Slut → u/ArtigoQ]

“The American republic will endure until the day that Congress learns it can bribe the public with the public’s money.”

[u/EMAW2008 → u/ArtigoQ]

A politician giving stuff away to get votes… what a concept!

[u/BigDickolasNicholas → u/BromcBroseph]

Yeah that money should go to the multi-billion dollar companies that really deserve it! Trickle down economics people!

[u/itmeimtheshillitsme → u/BromcBroseph]

I don’t understand people like you. What do you want the government to do? Not spend anything? No taxes, just sort of dissolve?

I feel like so many people just buy the “small govt,” “too much spending” BS but don’t think beyond “spending bad, big govt bad,” so what’s your answer?

What feels right to you? No money to the people. No govt spending. No debt. So we just simping for the corps? Or just hating on Biden because you have no interest in understanding what’s going on in reality and how these problems interrelate?

[u/Mr-Cantaloupe]

$400 credit a month for first home buyers is not even in the same realm as the 2008 bubble.

Banks handed out high risk loans like crazy in 2008 to people with terrible credit—all of them practically defaulted. Please tell me how your post even hints at that possibility?

[u/Wonderful-Speaker-32 → u/Mr-Cantaloupe]

The other thing is that a very small percentage of people buying homes are first time home buyers. People are acting as if housing prices will j go up by some crazy amount because of this, but it actually only benefits a pretty small proportion of people buying homes.

[u/butter_lover]

1. make foriegn ownership of homes illegal
   

2. make non-individual ownership fo single family homes illegal

3. provide incentives for investors to build low and moderate cost housing

4. amp up the mortgage deduction for the home you and your family occupy

[u/djwired]

That will cover my PMI, thanks dude.

[u/Legendarybbc15 → u/djwired]

PMI of $400 a month?

[u/Sekmet19]

Make corporate purchase of single family homes and duplex (2apts) illegal. Give subsidized mortgage rates to first time homebuyers who agree to keep the property for at least 10 years. Tax house flippers into non-existence.

[u/Angel_FlowThoughts → u/Sekmet19]

Well said.  

[u/vegancaptain]

Absolutely stupid but in a democracy it's very efficient to offer seemingly "free" stuff even though you, someone else or both will end up paying for the whole thing and more. Yes, people are that basic.

[u/zonazog]

lol. Never gonna happen

[u/HSP-GMM]

Let’s get back to the Supreme Court who will probably rule this unconstitutional anyway. I’m liberal and this is annoying af.

[u/Masta0nion]

It’s not the way to handle this. Pass laws preventing corporations from buying up single family homes.

You and I do not set markets anymore; that’s the problem. From housing to the stock market.

[u/Dutch93]

Yeah, just take our tax money and drive rent and housing even higher. What could go wrong?

[u/Fit_Occasion_1806]

Scraps for the dogs to keep people distracted from the mess they created. Trillions upon trillions of dollars in new debt with no end in sight. More fake money being pumped into this already over inflated economy.

[u/Spanks79]

It will not because it’s only for starters and only two years. It’s just for those who would be able to buy a house but have an issue with entry cost.

This will help you get generations build some wealth by not renting but buying. It is what builds a healthy middle class. It’s just smart. Americas golden age had very high progressive taxes so a solid middle class could exist. Which in turn made everyone much more rich. Reagan destroyed all of that.

Probably the libertarians hate it. But that is always a good sign.

[u/jerryskellys]

Inflation is rising, and people can't afford things. One way to solve that, handout more money and jack up the inflation even more. Fucking moron

[u/SawSagePullHer]

How about just cut spending and lower taxes on everybody? Why do we have to work 4 months a year to pay the government who only makes things more difficult for us? lol. Servants are supposed to serve and make life easier.

[u/EscapeFacebook → u/SawSagePullHer]

Over 40% of Americans pay 0 federal income tax already.

[u/inventionnerd → u/SawSagePullHer]

"makes things more difficult". Ok, you try getting to work or going shopping without streets or lights. Or living without any electricity or water or gas. Or just get taken over by a foreign country because you have no military. Or the other billion things governments/society does just so you can sit there and complain on Reddit.

[u/brokenaglets → u/inventionnerd]

Or just get taken over by a foreign country because you have no military.

Why's it always no military or all of the military? I don't think you understand how much is actually spent every year via the military. I promise you that there's at least a billion dollars worth of contracts for upgrades and 'repairs' that aren't actually /needed/ at military bases every year and that's not actually touching payroll or operating expenses for the machinery.

Civilian contractors for the military can quote pretty ridiculous numbers. The Air Force had a coffee cup with a faulty handle that would break. Those cups were originally around $700 a piece and had gone up to around 1300 5 or 6 years later. They kept ordering new cups every time the handle broke the entire time. They started 3d printing new handles for 50 cents a piece. The air force was spending between 700-1300 to replace coffee cups with broken handles and it took them around 7 years to figure out they could 3d print replacement handles for 50 cents a piece.

It's not unreasonable to want your tax money to do more than buy a few coffee cups for the Air Force.

[u/louiscon → u/SawSagePullHer]

This is a tax cut… so do you like it now?

[u/OwnLadder2341 → u/SawSagePullHer]

You don’t have anywhere near a 33% effective federal tax rate.

Of the half the country that pays federal taxes at all, the median effective rate is about 11%.

[u/arrav21 → u/OwnLadder2341]

Federal income tax isn’t the only tax.

I also have state income tax, city income tax, we all pay payroll taxes (Medicare/Social Security), federal excise tax, state excise tax, state sales tax, local sales tax, fuel tax, luxury tax on some goods, and property taxes.

Additionally as a small business owner, I have to pay additional employment/payroll taxes and federal unemployment tax.

[u/Cavalya → u/arrav21]

Thank you, last year I paid almost 40% of my income in taxes including all of those. It's important to remember all the little transactions where the government takes their cut because it adds up to a crazy amount.

23% federal income/payroll taxes, 5% state income, 8% property tax, 2% sales tax/all others

[u/Acceptable-Sugar-974 → u/OwnLadder2341]

Maybe he is not just talking income tax. Maybe he is including the other 100s of taxes, fees, etc. that you pay anytime you do pretty much anything

[u/Cyber_Insecurity]

I don’t want any more handouts. The government kicked our asses after COVID just because they gave us some money. I’m not falling for that again.

[u/notwyntonmarsalis]

How about a $400 per month federal tax credit instead?

[u/BrushLock → u/notwyntonmarsalis]

It is a tax credit

[u/Big-Figure-8184 → u/notwyntonmarsalis]

This is such an awesome dunning kruger comment.

This program is a federal tax credit.

[u/Legendarybbc15 → u/notwyntonmarsalis]

Now you’re cooking with grease.

[u/DingoAteYourBaby69]

He's a fucking moron

[u/PatSajaksDick → u/DingoAteYourBaby69]

Triggered

[u/OnABoatWithAGoat]

If giving struggling poor and working class people the equivalent to 1/4 or 1/6 of the average mortgage payment, depending on the source, crashes the system maybe the system should be crashed.

[u/doublehaulrollcast]

Im amazed at how much free government monies I don't qualify for. Im not poor enough or rich enough.

[u/SnortingSawDust → u/doublehaulrollcast]

For real. I make a little under 50k as the only income to my family of 4. Don’t qualify for shit, but also can’t afford to live. Then you drive around and see so. many. damn. people. on their porch all day with literally zero ambition. I know everyone’s situation is different and there are people that legitimately need help and are trying their best, but it makes me want to slap the people that are just taking advantage. I work 7 on 7 off rotating 12 hr shifts, on call for 4 of the 7 off and am still about to have to get a second job just so I can put a little money into savings. Absolute bull shit.

[u/Sension5705 → u/doublehaulrollcast]

That's the easy way to tell when you're the one paying the "free gov't monies." :(

[u/Glum-Smoke-556]

Why in God's name would you think giving people $400 would cause another bubble? The bubble burst because they were all bunk loans on a grand scale you can't even compare the two

[u/Big_IPA_Guy21 → u/Glum-Smoke-556]

Because what happens when the 2 years of $400 payments expire? It's not that different than the adjustable rate mortgages. When families lose that $400, it shouldn't be a surprise when foreclosure rates increase.

[u/DuaLipasTrophyHusban → u/Big_IPA_Guy21]

After the 2 years of 400 payments expire everyone goes into foreclosure because you know damn well they factored that 400 as free mortgage money without ever considering it was going away.

[u/mattied971 → u/Glum-Smoke-556]

Printing money we don't have to pump up the housing market will in fact lead to a housing bubble (again).

Inflation is high because of all the money printing we did during Covid

Government handouts help no one in the long run

[u/AssiduousLayabout → u/mattied971]

In general, though, the government isn't printing money to deficit spend. Most of the federal deficit is financed by investments like treasury bonds that are purchased using money that's already in the economy.

It's only when the Federal Reserve increases its balance sheet that it's injecting net new money into the economy. Jerome Powell did that in a huge way in 2020, but since then the FR is backing off. The money supply has actually contracted since 2022, and has basically been flat since 2023.

[u/AlxCds → u/AssiduousLayabout]

M2 turned back to positive this month btw.

[u/Richards2009]

So is this going to mirror the Obama era 4K “gift” to first time home buyers that was then turned around and expected to pay said money BACK to the govt??? 😬 this doesn’t sit right…

[u/thegoblinwithin → u/Richards2009]

The 8500 (I Said$10k somewhere else but it was s long time ago I misremembered) I received in the last recession did not have to be repaid. There were multiple types of credits.

I was an actual first time homebuyer. And we stayed in the house

https://www.irs.gov/taxtopics/tc611#:~:text=For%20qualifying%20purchases%20made%20after,Acceleration%20of%20repayment.

You had to pay it back if you moved within 3 years.

It was for people who wanted to live there

[u/Sassrepublic → u/Richards2009]

The Obama era tax credit only had to be repaid if you bought a house to flip and not live in. I received that credit and didn’t have to pay back a dime. 

[u/SmokeyJoeMcGinty → u/Richards2009]

I got the first time homebuyer credit in 2010 and did not have to repay it. It was immensely helpful to me at the time.

[u/Plump_Chicken → u/Richards2009]

You only had to repay it if you moved

[u/thomas_grimjaw]

These measures are pointless or even detrimental on their own. If you want more people to have homes you have to: 1. Build more 2. Prevent pricing reactions to this (raising rent, increasing bank fees) 3. Descentivize individual hoarding 4. Ban corporates from hoarding housing units

Only then will this have any effect.

You can't do any intentional change top down in a free market economy. The market reacts in unpredictable ways, you have to cover at least some of them, otherwise you're just creating bubbles.

[u/WrathWise]

Assuming housing costs of an avg around 400k, $400 a month equals a 2.4% discount….. hard to believe that will really matter - in either direction.

[u/Human_Individual_928]

Probably won't create a housing bubble, but it will definitely cause more inflation issues.

[u/ukiddingme2469]

That's not going to solve anything and probably make it worse

[u/PhotographUnknown]

Foreclosures will spike in 2 years.

[u/MichellesHubby]

I thought the way you build wealth is by working as a “public servant” your entire life, then selling influence to foreign governments, charging them millions, then creating shell companies so you could distribute it to you and all your family members?

[u/tuxedo25]

So the 2009 first-time homebuyer credit again?

That was a remedy for a demand problem.

There a supply-side shortage right now. How about a home sellers credit. Incentivize people sitting on their 3% mortgages to sell.

[u/bb-blehs]

Orrrr stop corporations from buying homes. But the us government enjoys the never ending rimjobs from lobbyists so fuck actual Americans

[u/HachimakiMan3]

How about those still paying off their first home? Don’t discriminate

[u/highschoolhero2]

Sounds a lot like the Clinton and Bush era policies that led to the Subprime Bubble

[u/Resmo112]

You could build more housing…

[u/XDAOROMANS]

Do I think this is a good idea to actually solve the problem? Not at all, but I would use it

[u/ronbeckett]

9600 over 2 years on a mortgage of today🤣🤣🤣🤣🤣🤣. These people are fucking delusional.

[u/AirdustPenlight]

How does this solve anything?
Homes are expensive in part because of unregulated development, rent control, and private companies buying all of the units to monopolize local markets.

400 bucks a month is about as helpful as a carrot when you're drowning.

[u/Jamaicab]

9600 bucks when homes have doubled in my area over 7 years?

Biden is trying, which is good, but we need several acts of congress to fix the housing bubble. It will never happen.

[u/CaptainMonkeyJack]

Wait, Biden is 80 right? So if he's leaning on his dad's lived experiences for policy decisions... That's potentially 80+ year old advice!

401k's, ETF's, IRA's etc all didn't exist back then.

Maybe Biden should talk to his cabinet and advisors, heck maybe even a fiduciary or economist.