If the government really wanted to promote AFFORDABLE homeownership they could simply limit Fannie/Freddie/VA(and other GOV housing programs) to 1 loan per household.
You want to move up into a nicer house? Sell the old one. Don’t wanna? Fine, then you pay the nonsubsidized rates and fees and DP’s (ie it isnt conforming.) I thought the “American dream” was to own your own home, not every single one you could get your hands on.
It wasnt long ago the GSE’s limited you to 10 loans. 10! That is an awful lot of move up buying. Cept it isnt move up buying, it is mini- Donald Trump building. I believe it is currently 4 loans. Still to high IMO. I am not saying you shouldnt be able to own more than one home. If you want to own a rental great, do it. But dont expect taxpayer subsidies for your buisness, even if that is just a prefered interest rate and lower equity/DP requirments.
Now some would argue that this will limit the supply of rentals and there for drive up the cost of renting. I dont think that is true. It would force more houses onto the market, bringing down prices. If it was cheaper to buy then rent, people would buy and rentals would be SOL. LL’s would have to actually compete with the quality of housing around them.
Not saying this would ever happen. I think the NAR would start suicide bombing congress if they ever started reducing the house buying subsidies that keep prices high. But I do think it is rediculus that the American dream of giving your kids a better life than you had has now become the american dream of owning as much property as possible and F the kids if we have to deficit spend to do it.
