00:00President Trump says he's gonna lower mortgage rates
00:02to help people buy houses,
00:03but he's also gonna raise home prices
00:06for homeowners to get a better valuation.
00:08Now those two things can't really happen at the same time,
00:10so what's going on here?
00:11So Trump has been telling Americans
00:12he will make housing more affordable
00:14by pushing mortgage rates down.
00:16Those interest rates are coming down
00:18and with a proper, intelligent person at the Fed,
00:22that person will be able to work with us
00:24to get interest rates down.
00:25And in that same breath, he's also promising homeowners
00:27that their property values will keep rising.
00:30For those people, those millions of people that own houses,
00:33we're gonna drive those values up.
00:34And that all sounds great,
00:36until you realize that those goals clash, and here's why.
00:39Lowering the national interest rates
00:41makes buying houses cheaper per month
00:43so more people can jump into the market.
00:44And in theory, that works,
00:47but the president doesn't control mortgage rates.
00:50That's the Federal Reserve.
00:51Now Trump can pressure the Fed
00:53or the current chair, Jerome Powell, to lower the rates.
00:55He might also use federal agencies to buy mortgage bonds,
00:58which might nudge rates a little bit,
01:00but experts say the impact won't be enough
01:02to make a difference.
01:03But even if he could get lower rates,
01:05promising to raise home prices at the same time
01:07would cancel out any benefit.
01:09Higher prices help people who already own homes,
01:12but they make it even harder for renters
01:14and first-time buyers to ever get in.
01:16Claiming to make housing affordable
01:17while also pushing valuations higher
01:19is like lowering the price of concert tickets,
01:21but taking out five rows of seats.
01:23And for current homeowners, rising prices
01:25isn't a free win either.
01:26Higher valuations mean higher property taxes,
01:29higher insurance costs, and bigger barriers
01:30for their own kids when they go to buy a house.
01:32Besides that, experts say the other big factor
01:34is that the US simply just doesn't have enough homes.
01:37Without building more, lowering rates just fuels demand.
01:40Raising prices pushes the ladder further out of reach,
01:42and affordability doesn't improve
01:44for anyone who isn't already in the market.
01:46But with all that being said,
01:47we wanna know what you think.
01:48Do you think Trump will be able
01:49to make housing more affordable?
01:50Let us know in the comments,
01:51and for all your latest news,
01:53check out our website and follow us here for more.
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