- A U.S. housing official says the agency is working on a 50-year mortgage.
- The FHFA is evaluating “relief” for 5-, 10-, and 15-year mortgages.
- Right-wing conservatives denounce “for life” mortgages.
U.S. President Donald Trump has downplayed the importance of possible 50-year mortgages, seeing them as a way to make homes more affordable than traditional 30-year loans, as some supporters balked at a plan that would force homeowners to pay more interest and take longer to build equity.
“All it means is you pay less per month. You pay it over a longer period of time. It’s not a big factor. It might help a little,” Trump said. Fox News“The Ingraham Angle” was released Monday, blaming his Democratic predecessor Joe Biden and the Federal Reserve’s interest rate policies for housing affordability problems.
Conservative lawmakers, influencers of Trump’s Make America Great Again movement and economists were among those who rejected the idea, pointing out that it would take longer for people to actually own their homes. However, some analysts believe that this could stimulate some investors.
Over the weekend on ” while right-wing activist Mike Cernovich reacted with “mortgages for life.”
Housing affordability is a key issue
U.S. Federal Housing Finance Agency Director Bill Pulte said Saturday that the FHFA was “working on” a five-decade mortgage after Trump, a Republican, posted a photo of himself under the caption “50-year mortgage” on social media.
“This is a total game changer,” Pulte wrote on X.
“We are also working on ways to alleviate the 5-year mortgage, the 10-year mortgage and the 15-year mortgage,” he wrote separately on Sunday, without providing details and adding that the agency was looking at “assumable or transferable mortgages.”
The FHFA did not respond to requests for comment.
“Everyone is working together to implement the president’s policies,” White House spokesman Davis Ingle said, adding that any policy changes would be announced by the White House.
American households are grappling with a rising cost of living, even as inflation rises at a slower pace. Prices took center stage in last week’s elections, which saw Democrats win key elections as Trump doubled down on his economic agenda.
“I don’t know if they’re saying that. I think the polls are wrong. We have the greatest economy we’ve ever had,” Trump told Fox on Monday.
Affordability could remain a challenge for many potential buyers as housing prices remain high, nearly 60% above pre-COVID-19 levels on average.
While home sales rose in September, pending sales remained surprisingly stable despite falling mortgage rates, which fell after the Fed lowered its benchmark interest rates last month.
Despite falling rates, the property market remains stuck, with the median age of first-time buyers hitting a record high of 38 last year, well above the late 20s that was typical in the 1980s.
“Fixing the Supply Side”
Trump has called for more drastic rate cuts from the Fed, with Treasury Secretary Scott Bessent blaming current rates for what may already be a recession in the housing sector and White House economic adviser Kevin Hassett saying Tuesday that housing prices remain a priority.
The US president could address housing and affordability issues in an upcoming executive order, according to sources briefed on the matter.
The average rate on the popular 30-year fixed-rate mortgage is at a one-year low of 6.19%, after rising to 7.04% in January, according to Freddie Mac data released last month.
“It’s unclear how much this could reduce the monthly payment because we don’t know what the interest rate would look like compared to a 30-year mortgage,” Daryl Fairweather, chief economist at Redfin, wrote on X. “A more effective and long-term solution is to address the supply problem.”
Analysts at TD Securities told investors Monday that the idea of a 50-year loan could take at least a year to come to fruition and “will only work if there is a corresponding increase in housing supply,” which requires lower construction costs.
By increasing demand for housing, these mortgages could also drive up housing prices, putting them further out of reach for buyers.
Greene, who represents a district in Georgia, also said more could be done to make renters eligible for home loans, among other measures.
As for the sector, BTIG analysts said 50-year mortgages could boost companies such as Ellington Financial EFC.N, United Wholesale UWMC.N and Redfin owner Rocket Companies RKT.N.
