In early November, The Hill reported that Federal Housing Finance Agency (FHFA) Director Bill Pulte was working on a plan to introduce a 50-year home mortgage to buyers.
This scheme is unwise. It will make housing more expensive, hurt taxpayers, and set the groundwork for a future housing crisis. Sound reasoning indicates that the FHFA should not create the 50-year mortgage.
In fact, right there is the heart of the problem: that it is the Federal Housing Finance Agency that intends to create this mortgage product. The last 90 years of federal intervention in the housing market, from the National Housing Act of 1934 onward, have been a disaster. This was inevitable. It is intrinsic to human nature that central planners cannot allocate resources efficiently for the satisfaction of anyone’s desires save their own.
It is also in the nature of things that men who make their way in the world by seizing the resources of others at the barrel of a gun have little, if any, incentive to work for the good of others. Their access to violence precludes the need to produce anything useful.