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Comment by beembeem | Hacker News Reader

This was an explicit goal of housing policy in the US 100 years ago. Read any text from that time period and you will see that housing was viewed as an investment and the foundation of wealth. Policy was therefore supportive of this view.

It's time we revisited this now that the country looks very different.

- For one, there is a large trend towards urbanization which changes the makeup of the country.

- The 30 year fixed-rate mortgage and mortgage interest deduction (now capped, and less impactful given higher standard deduction amounts) have been a large contributor to housing values being distorted from normal market prices.

- Throw in low interest rates, widespread speculation, financialization of real estate (ABNB, loanmls.com, etc)

you end up with a human right being divvied up by institutions, speculators, and an aging wealthy populace that has no interest in sharing the pie.

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The 30 year fixed-rate mortgage and mortgage interest deduction...have been a large contributor to housing values being distorted from normal market prices.

That should be easy to test. Hardly any other country has 30 year fixed rate mortgages and lots of countries have far lower mortgage interest deduction. Would be interesting to measure the distortions in those countries and compare to the US.

Canada has no mortgage interest deduction and feels it has a real problem with vacant/investment housing (particularly in Toronto or Vancouver). Given that it’s adjacent to the us this should give you useful data. But I think a big problem is that more housing would result in lower house values which would bother the crap out of oldies and conservatives.

Are you saying a young liberal owning a house would not be upset to see the price of it go down?

“The 30 year fixed-rate mortgage and mortgage interest deduction (now capped, and less impactful given higher standard deduction amounts) have been a large contributor to housing values being distorted from normal market prices.”

I’m not sure how much of a factor that is - here in Australia our house price : household income ratio is, if anything, even more deranged than it is in the US, and 30 year fixed rates are unheard-of here - maybe 2 year fixed rates at certain times, but usually most mortgages are variable (and usually at higher rates than in the US).

> ...an aging wealthy populace that has no interest in sharing the pie.

If they were young, I'd understand. If they are aging... what's in it for them? A hope that cryogenics will come good?

It’s a retirement piggy bank that you can tap via HELOC.

After certain age, reverse mortgages become a potential new source of income, so in short term one would be interested in rapid appreciation of underlying property.

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