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Harris's Destructive Housing Plan: A Path to Rising Property Pri

Countless people are still holding onto the dream of becoming homeowners even though the events of recent years have made this goal seem downright impossible. The situation may become worse, though. Why? Because the American Dream of owning a home faces an even greater threat of extinction if Kamala Harris sets her newly unveiled housing plan into action.

Harris is being dubbed an economic genius, so any plan she puts in place should boost the economy and the housing market, right? Well, that may not end up being the case because analysts predict that the aftereffects of this specific plan may push the housing market into a much worse position than it’s currently in.

Even the Washington Post declared that Harris is presenting “populist gimmicks” at a time when we need serious economic ideas. On top of this, her plan seems to be straight out of Justin Trudeau’s playbook, which is concerning because his tactics are not working for the Canadian population as far as the housing market is concerned.

With all that said, if you’re unfamiliar with what Harris has in store for the housing market, dive in for the fine details to judge for yourself if it’s a good plan of attack or not.

Kamala Harris’s Plan Will Further Deteriorate the Housing Market

Although the proposed housing plan may sound like a good deal to many, when you dig deeper, you start to see major flaws that will actually take down the market, not lift it up. So, what is she claiming will better the housing crises? Provide federal assistance to first-time home buyers in the form of a down payment, tax incentives for builders, and stopping “predatory investors” from buying in bulk, as well as a few other items, but we’ll stick to these three major components.

The Broken Pieces of the Plan Intended to Save the Housing Sector

Ok, now let’s break down the specifics so you can get a well-rounded view of what this all means for the housing market:

1. The $25,000 Down Payment Handout

Harris’s plan includes a $25,000 payment assistance program that will provide funds to first-time homebuyers who have paid rent on time for the past two years, with the goal of assisting over 4 million prospective homebuyers.

Harris's plan to fix the housing crises with a 25,000 handout will destroy the housing market

This sounds like a fantastic offer that will help those who can’t afford a home, allowing them to finally live the American Dream. But, it’s not as simple as it sounds though, especially when you ask where will they get the money to fund this, what impact will it have on housing prices and inflation, and what happens once those individuals who couldn’t afford the home in the first place, start receiving their mortgage bills that sport high interest rates?

So, you see, a huge down payment offer sounds helpful on the surface, but once you start peeling the layers off, it reveals potential issues that could have devastating effects.

Related Article: American Dream CRUSHED – SCE Housing Survey Reports Renters’ Hopes of Owning a Home Sinks to Historic Low

Property Prices Will Instantly Rise and Deteriorate Home Affordability Further

When it comes to housing prices escalating if this government program goes into effect, I’m reminded of another program the government unleashed not too long ago. Remember when they cut EV prices with incentives, pushing the green agenda? Well, the ripple effect was that car manufacturers had to increase their prices to make up for it. And as we all know now, demand for EVs plummeted, leaving dealerships with piles of electric vehicles that won’t sell. The bottom line is that it caused a financial mess and it’s clear that the program was not thought through very well.

Now, let’s relate the EV situation to the down payment giveaway. It’s predicted that if buyers are given $25,000 for the purchase of a home, that the homeowners are going to instantly raise their prices.

So, in reality, the cost of housing goes up, which pushes mortgage payments up too, and this will further deteriorate home affordability. On top of this, it’s common sense that if the market is flooded with buyers all at once because they all have $25,000 to make a deal happen, then housing prices will skyrocket because of the high demand.

Sen. Tim Scott, R-S.C, has some insightful remarks on this: “Will only make the demand higher with the supply not moving, which means that prices will go up, fewer people are going to be able to afford it. And frankly, unless they’re going to embed financial literacy in any program, it only means there will be a higher level of default.”

The Plan Could Assist “Over” 4 Million Households

If you’re wondering where the money will come from to dish out $25,000 to 4 million people, keep pondering that question because the number of giveaways could be much higher than that number. Her plan contains the phrase “over 4 million” first-time buyers. The requirement of being a first-time buyer won’t keep the eligible numbers low because if you go by HUD’s definition of a first-time buyer, its main qualification is that you or your spouse have not owned a home in the last three years. Ok, how many renters do you think would fall into that category? I’d say a lot more than 4 million, and that’s where the term “over” dangerously comes into play.

And will this pool of funds also be freely handed to illegal immigrants? The non-citizens who have been pouring into the country have already received an exorbitant amount of financial assistance, so why would this be any different?

Related Article: Stealing the American Dream – CA Proposes Zero-Down Home Loan Handout to Illegal Immigrants

Passing out this much free money to Americans or non-citizens will not only be a burden on taxpayers, but also cause inflation to skyrocket, just like it did due to the pandemic cash handout where money was printed out of thin air. We’re already over 35 trillion dollars in debt as a nation. So, if you think about it, we would be giving away money we don’t have, with the end result being that the national debt gets pushed up even higher. This certainly doesn’t sound like a clever economic plan to me.

2. Cracking Down on the Bulk Real Estate Buying Business

Her plan also includes limiting investors who buy in bulk, labeled the “Stop Predatory Investing Act,” which states, “This bill denies taxpayers owning 50 or more single-family properties any tax deduction for interest paid or accrued in connection with any single-family residential rental property. It also disallows depreciation of residential rental property owned by such taxpayers.”

What effect could this have on the housing sector? Well, this comment by Carl Harris, Chairman of the National Association of Home Builders, sheds some light on the situation, “NAHB is concerned that efforts to target institutional investors will harm the growing single-family built-for-rent market, specifically those homes built for the rental market, further disincentivizing housing production that is otherwise desperately needed.”

Harris's plan to stop bulk home buying

The build-to-rent industry is one of the most successful areas of new construction, so limiting builders in this sector could limit the housing supply further.

Related Article: Demand for Build-to-Rent Homes Surging with New Starts and Completions Outpacing Last Year’s Data

3. Tax Incentives Aimed at Promoting the Development of 3 Million Homes

To fix the housing shortage that America is currently dealing with, Harris proposes to build 3 million housing units for rent and for sale, over a span of four years. The plan is to accomplish this with tax incentives such as their $40 billion “innovation fund,” which will “empower local governments to fund local solutions to build housing.”

Along with this, there will also be a tax credit for those who build starter homes for first-time buyers. Although any home is expensive to build, starter homes are generally smaller and cheaper to construct. Now, it’s said that the program is directed toward promoting the creation and rehabilitation of starter homes for sale in distressed communities. Does this mean that taxpayer dollars will go towards funneling millions toward already failing and declining housing communities that typically have a high rate of mortgage defaults?

It’s also worth mentioning that there’s a program called “The Low-Income Housing Tax Credit” that’s been in existence for 38 years, and its focus is to build and rehabilitate properties. This is accomplished by providing tax credits to construct and rehab low-income housing. Well, in those 38 years, this tax incentive program only has 3.6 million homes under its belt. The program started in 1986, and if this is all it has produced over a span of almost four decades, how will Harris meet a goal of 3 million in just four years? The truth is, promising to build 3 million homes seems more like a catchy campaign promise they know they won’t be able to keep.

Should the Government Oversee or Control Housing Market Dynamics?

Will this housing initiative work in any capacity? I’ll let you ponder this as I take you back to The Great Society that was created in the 60’s. The Great Society was a group of domestic programs launched by American President Lyndon B. Johnson. One aspect of the program focused on building public housing. Although there was some success embedded within the program, when it came to creating low-income housing, it turned many areas into crime and drug-ridden neighborhoods with overcrowded homes that frequently housed more than one family.

So, maybe having the government direct the housing market was not such a good idea in many respects at that time. Will it be a success this time, though? Or, will they build “projects” or “Soviet-style block apartments” that can house the masses, as well as the illegal immigrants that are currently being put up in hotels?

Low Income Government Funded Housing

Many people feel that the government getting involved in the housing market is a bad idea in general, and from past government program track records, I agree.

Is 3 Million an Unrealistic Number that was Just Meant to Impress Voters

No matter how many incentives you throw out there for starter homes or for rental units, constructing this many properties in such a short amount of time seems unrealistic. Ken Mahoney, CEO of Mahoney Asset Management, is one person who doesn’t think it can happen.

Mahoney feels this is just another plan that won’t make the cut. Why? Because he remembers how the Biden administration announced plans to create 500,000 EV charging stations with billions in funds backing the project. The reality is that they’ve built seven. He states, “When they say, ‘build 3 million homes, I’m reminded about the charging stations, does that mean like 20 homes are going to be built?” You can read more about this project here if you’re interested – Democrat slams ‘pathetic’ progress on government EV charger installations.

Consider Smarter Approaches to Fixing the Housing Crises

Of course, I don’t personally have all the answers, no one should claim to, but there are people out there with some pretty good ideas. Innovative ideas are needed when you are trying to come up with solutions to fix a housing problem that spans across so many different states and so many different communities. It’s clear that it can’t be a one-size-fits-all program.

The NAHB put some good ideas into the public eye, and I’ll let their Chairman explain: “NAHB’s 10-point plan to ease America’s housing affordability challenges focuses on removing the impediments that are preventing builders from increasing the nation’s housing supply, which include eliminating excessive regulations, fixing building material supply chains, and adopting reasonable and cost-effective building codes, among other things.” 

Others are saying the government should make better monetary and fiscal decisions and then just allow the market some time to recover. By this, they mean that if incomes rise and mortgage rates decline due to smart economic decisions, housing will become more affordable.

For instance, a smart economic decision may be to stop funneling billions of dollars to fund overseas wars, stop printing the money we don’t have to spare to load thousands of dollars onto credit cards for the non-citizens that are pouring into our country, and don’t offer $25,000 (x) 4000,000,000 when you don’t have that money to responsibly give away. These things push inflation up, make housing unaffordable, raise our national debt, and destroy the economy. With that said, wouldn’t it make more sense to create a program that really fixes our issues, instead of short-term bandaids that put us deeper in the whole on many levels?

Related Article: A Ticking Time Bomb – National Debt Growing by $1 Trillion Every 100 Days

Protect Yourself from the Domino Effects of the Housing Crises that’s Only Expected to Get Worse

It’s disheartening to see yet another plan put forth that initially lifts the spirits of Americans across the nation; all the while, as the layers are peeled back, many start to realize that it can actually make matters worse for the housing sector, the economy, and the people. But this is the world we live in today, a crazy clown world where nothing makes sense. So, this is why it’s crucial that you sit in the driver’s seat of your own prosperity and well-being. You can make good decisions for yourself that protect your wealth and ensure you and your family are secure.

How can you place yourself in the driver’s seat of your own financial well-being? The same way I did, by investing in rental real estate. Owning a cash flowing rental property puts you in control of your investing because it’s out of reach of government control, and not swayed by the effects of the volatile stock market and the wavering economy.

Morris Invest Can Help You Take a Step in the Right Direction

For those who would like to go down a path that will secure their wealth, you can reach out to Morris Invest. We’re a full-service real estate investing company that provides new construction rental properties in lucrative markets.

Related Article: Lubbock Recognized as Recession-Proof City and Maintained a Strong Rental Market Throughout the Pandemic

Our team will do all the work for you, with the end result being that you become the owner of a property that provides monthly rent checks that flow in like clockwork. On top of this, we assign an experienced property manager who can care for your rental and your tenants, and we also place a reliable renter for you as well.

For those of you who are worried that you won’t get approved for a loan, know that we work with over 200 banks, so if one says “no,” another will say “yes.” Also, because we have great relationships with so many banks, we can offer lower-than-industry-standard interest rates on your loan.

In addition to this, there’s a company called Fund & Grow that works with many of our clients to find the funds for a down payment through zero percent interest introductory business credit cards. Be sure to read more about Fund & Grow to decide if it’s for you or not.

Power Resources for Real Estate Investors

You can also check out our power resources for real estate investors to get a better idea of who we are and how we can help you build wealth:

Feel free to give us a call so we can answer any questions you may have or tell you about our available rental properties, and so on. In the meantime, dive into my latest video on the topic at hand for some insight as to my views on the housing plan Harris is presenting to the American public:

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