Let's talk about Trump's plan to raise housing costs.... - Belle of the Ranch

Well, howdy there Internet people. It's Belle again. So, today we're going to talk about Trump's plan to raise housing costs.

In oddities, Vance tried to lay out a plan to make housing more affordable that was definitely eyebrow raising and said, "The most important thing that we can do to make housing more affordable is to actually lower interest rates. Right now, because of the Federal Reserve, we have interest rates that are still way too high.”

Oddly enough, that's not how this works. If you have lower interest rates, more people can finance, which means more people are in the market to buy a home. That's higher demand, which means prices don't go down. I know, I know. I'm just some lib or whatever so let me give you a quote where Trump himself said that lower interest rates wouldn't make housing more affordable.

--Trump said, "Existing housing, people that own their homes, we're going to keep them wealthy. We're going to keep those prices up. We're not going to destroy the value of their homes so that somebody who didn't work very hard can buy a home. We're going to get. We're going to make it easier to buy. We're going to get interest rates down." Straight from Trump--interest rates down will keep those prices up. It looks like the plan is to convince people that having a slightly lower payment via lower interest rates is addressing affordability, even if that slightly lower payment is still out of reach for most people. The idea here is to keep you in debt. That's why they push the 50-year mortgage idea. You'll own nothing and like it.

The housing affordability issue isn't because of interest rates. There is no single magic policy position that will fix the fact that in 1985 the median household income was about $23,600 while the median home price was only $83,800. That's a ratio of a house costing three and a half times income. In 2025, median household income is $83,700 and the median home price is more than five times that income at $426,800. That's the problem. Lower interest rates, creating 50-year mortgages, and so on don't address that.

Decades of Republicans fighting wage increases for anyone except CEOs has led to this. People aren't paid enough to keep up with prices. Higher wages, better benefits, more supply. Yes, homeowners will take a hit on their equity. You want housing to be more affordable. That's the plan. Then, yes, lower interest rates will help. This isn't rocket science or advanced economics. This is basic supply and demand. But without those other steps, prices, well, as Trump said, we're not going to destroy the value of their homes so that somebody who didn't work very hard can buy a home.

The idea is to convince people who own homes they'll benefit from higher prices. While convincing buyers, they'll somehow benefit from lower prices at the same time. Outside of Trump world, only one of those things can happen at a time. Judging by the policies they're actually calling for, well, they're going to keep those prices up.

Anyway, it's just a thought. Y'all have a good day.