California funding 3% down first time buyer program with $1B a year | Hacker News Reader

California funding 3% down first time buyer program with $1B a year

calmatters.org

2 pointsshaburn12 comments

Quite irritating that so many governments around the world, not only the US, but NZ, Aus, Canada, the UK, and parts of Western Europe continue to believe the answer to the real estate cost problem is juicing demand rather than building out more supply.

I wonder how long until the average home is $5 million, the average mortgage term 100 years, with a heavily subsidized 1% down payment, and subsidized interest rate.

Government can't force people to build. Unless you want to swap out capitalism (which I assume you do) the builder needs incentive to build. The only incentive to build is active buyers and prices going up.

They could at least stop preventing people that may want to build

Reforming zoning laws may not be the panacea but it's a vital first step

Or they can just functionally ignore them like most laws.

Umm in California, some version of the Government is always in the way of the build. Homes also have almost always sold well above building costs.

The government can pay and build things itself, however.

Not a great history here for residential

It worked well for Singapore. It can be done, conceptually.

Great anecdotal example that only seems to apply to Singapore. See China today for state sponsored high rise outcomes elsewhere.

Chinese culture is completely different; they treat property as a sure-fire growth asset and are generally desperate for secure investments, hence why so many just bought property sight unseen in the middle of nowhere with no housing demand underpinning it.

We can use success stories as guidance and failure stories as cautionary tales when devising policy, you know.

You want the US to follow policy and investing leads by mainland China?

California is starting one of the most interesting experiments in Real Estate. It is effectively functioning a hedge fund extending 3% down payment mortgages for first time buyer in the state. Huge incentive to pump property values at all cost and pushing much of the risk on the buyers.

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