America, You’re Funny-Housing Prices

America is funny, it complains about affordable housing and income inequality without understanding how the two are linked. You see, there are people in this country who buy houses every five years as part of the “first time home-buyer” program where they can put down as little as 5% down and buy a house. The government gives them that money. So every year they do it because it is free money in essence and after they live in the house for 2 years they can rent it out. So imagine that some people build this up to the point that they can start buying houses for cash. So now you have some people who own 5, 10, 50 houses!  It makes no sense for them to sell those homes or to have new homes built, because they collect rent checks on those homes.

So all the young and poor cannot find a decently priced house because they don’t plan to rent. So they cannot grow their wealth, they cannot save and they ask for more housing. The politicians are some of the people with the five or ten houses. The politicians have friends with 5 or 10 houses, they are told by their friends and voters to not build houses for fear of house depreciation.

And thus we have the growing income inequality, because people have to live further and further from work, so they spend more and more money on gas to work, their paychecks don’t rise and they cannot build wealth, while the few with the five or ten and twenty houses, keep getting richer.

We don’t have a housing shortage, we have a landlord surplus.

America, you’re funny.