50-year mortgages won’t fix the affordability crisis

Bill Pulte, director of the Federal Housing Finance Agency, recently floated the idea of offering people a 50-year mortgage instead of the more conventional 30-year financing option. it sounds attractive at first because stretching out repaying of a mortgage would lower the borrower's monthly payment, but this wouldn't fix the homeownership affordability crisis.

- EJ Antoni, Tribune News Service

It's no exaggeration to name the current situation as a crisis. According to the Federal Reserve Bank of Atlanta, the percentage of a household's income needed to afford just a median price home is near a record high today, and affordability is near a record low. An entire generation of young Americans has largely given up on the dream of homeownership.

The profligate spending of the Biden administration and the monetary mismanagement of the Federal Reserve caused both home prices and interest rates to skyrocket, a deadly one-two punch that knocked out the housing market. Because home prices and interest rates are the primary factors in determining a potential buyer's monthly mortgage payment, when those two inputs quickly rose, Americans saw the monthly mortgage payment on a median price home more than double in less than four years.