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The Case Against 30-Year Mortgages

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13 points paulpauper | 1 comments | 11 Oct 25 16:42 UTC | HN request time: 0s | source
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JKCalhoun ◴[11 Oct 25 17:17 UTC] No.45550868[source]▶
By all means I can imagine the 30-year fixed loan could be driving up prices of the land itself (the lots). There is of course a non-trivial cost for materials and labor, below which you would never expect see the price of a new home fall.

I suspect though, for better or worse, if we had to pay cash for a home, builders would simply be putting up inexpensive mobile-home style houses on tiny lots. Suburbia would look very different from what it looks like today.

It also seems likely that if the 30-Year Fixed went away, only the truly wealthy would be able to buy homes … to rent to the rest of us of course.

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1. wakawaka28 ◴[13 Oct 25 05:05 UTC] No.45564841[source]▶
>I suspect though, for better or worse, if we had to pay cash for a home, builders would simply be putting up inexpensive mobile-home style houses on tiny lots. Suburbia would look very different from what it looks like today.

There are other kinds of loans and different terms too.

>It also seems likely that if the 30-Year Fixed went away, only the truly wealthy would be able to buy homes … to rent to the rest of us of course.

The cheap credit drives up home prices. It's not actually an obvious aid to poor people. It discourages saving up for a house. Higher interest rates would drive prices down and make down payments easier to save up.