Senate Moves to Subsidize Homes for the Rich

And democrats control the senate. Surprised? You shouldn't be. Democrats and republicans, same thing, work for the same people.

The Senate Moves to Subsidize Homes for the Rich

Anyone who hoped that we would begin to see how the mortgage market might function with a tiny bit less government support should be pretty disappointed today. The Senate approved a measure that would reinstate the high-cost mortgage limits that expired on September 30th. The move seeks to ensure that relatively affluent Americans will get slightly cheaper mortgages, while keeping the training wheels on the housing finance market.

For anyone who hasn't been following along, here's a detailed explanation. For a quick refresher, the government agreed to back bigger mortgages in 2008 when the credit markets froze up. At that time through September of this year, the mortgage limit was 125% of the metro area's median home price in 2007 or $729,750, whichever was smaller. Prior to this jump, the limit was set at just $417,000. As of this month, that limit declined to 115% of the metro area's median home price in 2010 or $625,500, whichever is smaller.

You can see that this policy is specifically geared towards relatively expensive mortgages. It isn't meant to lend a helping hand to Americans on the cusp of home ownership. It isn't even meant to assist the average homeowner, who will have an income above the metro area's average. In any city, those who raising the limit would benefit will be relatively affluent. The old limits should be allowed to expire.

Brilliant.

Originally posted by Vitchilo
And democrats control the senate. Surprised? You shouldn't be. Democrats and republicans, same thing, work for the same people.

I never understood how the myth got started that republicans were the rich ones. Look at millionaire hollywood actors, all of them are democrats. Look at poor people that live in rural alabama, all republicans.

reply to post by Vitchilo


Where's the accountability for them? It's sad, even democrats are acting like republicans. We need some real and some smart democrats in our government right now. Obviously these guys are neither!

reply to post by WP4YT


People are also stupid.

As per the article, the limit (which had been set in 2008) was up to 125% of the median value of homes in a given area - the key words being up to. That means that average Joes whose homes may only be worth 65,000 - 120,000 are in that range. Homes for the mega rich - or even the rich - tend to be well above the limit covered by this act.

The article is flawed in that respect that they call this a subsidy for the rich, when it's geared more towards the middle and upper middle income home owners, with home values ranging in 100 to 300,000 range. In some housing markets (metro Dallas for instance) 300,000 would get you a 2-bedroom bungalow and you'd be thanking your lucky stars to get it for so cheap.

Not knocking the article though, overall I agree with everything the author is saying, and it's not something the government should be worrying about. I'm guessing they're still trying to grease the wheels of the housing market, and they're concentrating on the one market segment that generates the most revenue, the upper middle income earners.

From the Op's link.

Besides, some Republicans support a continued aggressive role for the government in the housing market. Two Republicans have sponsored bills that would largely maintain its role as guarantor of the mortgage market.

Whatever happened to the Republican's wanting less government intervention on our lives? When will either side learn to keep their grubby hands off of my stuff?

The SOBs will never learn...time for a new system.....the honour system....
If they dont honour the constitution their out!

The fact that the Senate is suggesting the subsidy of anyone's homes is ridiculous.
ESPECIALLY the rich. They're rich, they can afford a home. Why subsidize it?

This country is simply going to run out of money and fast.

reply to post by Vitchilo


I wouldn't consider $750k "rich" .. especially for a house? Someone making a combined income of $150k/year could easily afford a 750k house. I used to live (in an apartment) in a neighborhood where the median house value was $680k and it was a middle class neighborhood ... just houses were expensive. I can see on many places on the East Coast perhaps, that's a lot of money, but that's why there is a provision about metro areas .. meaning where I live it would cover a more expensive mortgage because house prices here are insane, but in Alabama the limit would be less than half of that price.

It's for the middle to upper middle class.

The article is a little disingenuous

One, it's simply an extension of what's already in place. Two, it covers a lot of ground.

Text of amendment

I think the government should do whatever the hell Texas is doing when it comes to the housing market, say what you want about the state but their doing something right. The houses here dirt cheap, all nice neighborhoods. Even the rent is cheaper for a 2 bedroom apartment next to the college, and they managed to do this during a huge immigration? I'm not sure if its going to end up like the housing boom that happen in Cali, though the prices are still maintain. Not sure if their subsidizing or not if anyone knows can you fill me in?

As for the article. They need to cut that s* out like 98 years ago.

would you rather they give visas to people in other countries who have the money to buy these overpriced houses???


that's another bright idea that came up last week....

of the two, I'd rather subsidize our rich people,
not that I actually think that the gov't should be subsidizing them, sooner or later we are gonna have to let all this crap stabilize and deflate some. the reason people aren't buying those high priced houses is that people are either underwater trying to pay for the high priced goods already, or they just don't have the money to buy the high priced goods. the answer to that one isn't to import more people to compete for what few good paying jobs there are out there, or for the gov't to subsidize our people so they can buy them.
the answer is a better trained workforce (how about coming up with a way for people to get trained without having to put themselves into debt at outrageous levels), good paying jobs, and a cheaper cost of living!

none of which will happen since it would require the higher income, "don't tax us more, we worked hard for our money", people to take the hit.....
and, they are the ones running the show....

reply to post by Mcupobob

I think the government should do whatever the hell Texas is doing when it comes to the housing market, say what you want about the state but their doing something right. The houses here dirt cheap, all nice neighborhoods. Even the rent is cheaper for a 2 bedroom apartment next to the college, and they managed to do this during a huge immigration? I'm not sure if its going to end up like the housing boom that happen in Cali, though the prices are still maintain. Not sure if their subsidizing or not if anyone knows can you fill me in?

Just an FYI, median home values in Dallas-FW area is $316,000 - Metro Dallas is well above that, and these are not large homes - 2 bedrooms tracts on a postage stamp sized yard - Texas has also been a boom state for McMansions with median values closing in on 500,000. Maybe out in the boonies or outside the metro areas you might see prices a middle class person might call reasonable.

reply to post by WP4YT


It has nothing to do with the regular people, my friend, but those that are in positions of govenrment and have ties to big interest money, tell me how many of our own for the people elected whores are actually poor people.

That is how laws are passed to benefit the ones at the top, influence and money goes a long way, the poor has none.

reply to post by Blackmarketeer


I live in Austin, only a couple of miles outside the city in the suburbs. Though I just came from California, were housing costed your first newborn, even out in the Boonies. Over a half a mil sometimes. Rent in the slums costed about 700-800 for a one bedroom in a crappy neighborhood in the middle of nowhere.

So I might just be coming down form the shock of the crap going on there.

EDIT: My aunt and Uncle got this place for just under 200K. 4 bed 3 bath.