Can Either Party Actually Bring Housing Costs Down?

I’m hearing a lot of conversations from both political parties about how they are going to bring housing costs down. While trying to be completely apolitical about this, I want to offer my thoughts.

One Side: $25,000 Credit for First Time Home Buyers

From one side, we are hearing about a $25,000 credit for first-time homebuyers. Once again, you can’t give people money and expect prices to come down. Sure, a $25,000 credit sounds great for the people who get to take advantage of that.

But if you pull a bunch of people into the market, what is it going to do? It will bring prices up! It’s a simple situation of supply and demand.

Other Side: Reduce Regulations

The other party is saying that they are going to bring down regulation. The thing that you need to understand about this strategy is that the vast majority of regulations are actually local, not federal. Yes, the federal government can try to reach down to the local level to force change. But it’s another situation where it doesn’t make sense.

What About Rental Prices?

On the rent front: I am hearing a lot here in California about rent control and how they are going to stop greedy investors and landlords from being able to increase their prices. What is this going to do? Drive investors out of the business? The people who stay in the business are going to have less ability to take care of their properties because they won’t be making enough money – neglecting the properties is not a good way to go either.

There are certain things that you can’t do a lot about. I think all of the promises we are hearing from both political parties might sound really good to bring down prices and make things more affordable, but there are real doubts about whether anyone will actually be able to do anything about real estate prices.

This is where I would love to hear feedback. Do you have a different perspective or take on the situation? I want to hear from you! Reach out any time.