The Real Fix for America’s Housing Market (and Why No One in Washington Will Do It)

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There's one simple, common-sense plan to actually fix housing —but Bill Pulte’s 50-year mortgage idea is nothing more than a self-serving scam for builders and banks.
In this episode:

• Why Bill Pulte’s “solution” is really a bailout for homebuilders
• The truth about who’s buying up your neighborhood — and how they rig prices
• How portable mortgages and property-tax reform could actually make homes affordable again
• Why real-estate agents and Wall Street don’t want prices to drop
• And why your home should never be treated like an “investment asset”

Housing shouldn’t be a financial hustle. It’s supposed to be a home.

Episode Transcript

Speaker 1 (00:00):
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it we'll have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.

Speaker 2 (00:16):
Hey, I'm not in charge of housing in urban development.
I'm not in the White House, but I'm going to
tell you right now how we could fix the housing market.
First and foremost, Bill Pulty is a used car salesman.
For all intents and purposes, he is self dealing. The
fifty year mortgage is self dealing. He is a builder.

(00:40):
Builders are having a very difficult time moving homes. They
are actually offering new home buyers below market mortgages. They're
actually paying lower into they're doing it giving all sorts
of incentives because they don't want to be sitting on
all these they're hurting. Okay, he is self dealing. He

(01:04):
puts out a fifty year mortgage. He doesn't have to
discount the homes that he has built. Again, conflict of
interest here, Come on, mister President, you put this guy
in there. I guess he's one of the President's best
friends within the White House. Home prices are up fifty
six percent since January of twenty twenty. You take a

(01:29):
look here, we've gone over this. Before nineteen eighty five,
median income in the United States was twenty three thousand,
six hundred and twenty median price home eighty three thousand,
two hundred Median income in the United States now seventy
four thousan five hundred and eighty dollars median price home
four hundred and sixty eight thousand dollars. It's insane anyway, Again,

(02:01):
what's going to happen with this? If there is a
housing correction, if you have a fifty year mortgage, well,
all of a sudden, people will be underwater in their homes.
They'll be underwater and they'll walk away. Had that happen
during two thousand and eight, two thousand and nine, we

(02:21):
had short sales, We had people just turning in the keys.
The same thing will happen again. Every single time the
government gets involved in housing, it drives the prices up.
Nearly seventy percent of new Federal Housing Administration borrowers last
year had debt to income ratios exceeding forty three percent,

(02:46):
which is considered risky. That's up from twenty eight percent
and twenty twelve. Thirty eight percent of new Fannie May
and Freddie mac bauers had risky debt to income ratios
compared to sixteen percent and twenty twelve. Buyers are more
leveraged than they were back during two thousand and eight
two thousand and nine. Rising property taxes, rising insurance costs,

(03:11):
these are all a part of owning a home that's
making it difficult as well. Oh, not to mention keeping
people in homes that can't afford the homes. We've talked
about this as well. Mortgage relief. The FAHA has paid
mortgage servicers to provide four barants or modify some six

(03:32):
hundred and ten thousand FHA mortgages over the last year.
That's more than the number of new purchase loans that
the FHA ensured last year. Writing down mortgages for borrowers
that can't afford them. Yeah, it's a great business for
mortgage bankers, but again, makes for fewer homes to buy.

(03:55):
There's a lot of this let me clean, somebody's up
for everybody. We're gonna do some simple things here again,
stuff we've been suggesting for some time. Again, a lot
of areas of the country. They're going to have a
very difficult time because there's so much waste you need.
You need to doze the entire local you know, communities
and towns and cities and what they're overcharging for property taxes.

(04:17):
But you've got to have property tax relief owner occupied homes,
owner occupied homes. Guess what not second homes, not third homes,
not airbnbs. Okay, you need serious property tax relief. How
about this. Private equity firms and real estate investors bought
one third of all single family residential properties sold in

(04:40):
the second quarter of twenty twenty five. That's a twenty
seven percent increase from the first quarter, highest percentage in
the past five years. Favorable tax laws when it comes
to real estate, and myriad event of things. I would
make that go away, but quick, I would that go away,

(05:00):
but quick, guess what you're gonna pay. You're going to pay.
We're not going to allow this. I've showed you the
scam that a lot of these private equity companies do
where they buy up entire neighborhoods, tire neighborhoods, sit on
it for about a year, sell to themselves, and a
separate fund a bunch of houses to themselves at a

(05:22):
higher price, thereby, you know, lifting the price of all
of the homes within that community because it's all based
on comps, so then they can charge more. We tell
you another thing that we could do, and Wall Street's
not going to like this. Every other damn financial instrument,
debt instrument out there. You can trade, you can package it,
you can trade it, you can sell it, you can
move it, you can groove it. For crying out loud, Okay,

(05:45):
Wall Street was doing all that stuff back in two
thousand and eight, two thousand and nine, slapping triple A
ratings on garbage mortgages and then sell them to pension
funds and country or whatever may be, whoever was buying them.
Why can't you take your mortgage with you? All these people,
how many mortgages were taken out? How many mortgages were

(06:06):
taken out when mortgage rates were anywhere between two point
six and let's say three three and a half percent. Well,
you want to move, you want to say your house,
But why can't you, you know, take that loan with you.
Make them notable, no problem, or make them transferable. Somebody

(06:27):
wants to buy your house. Well, hey, listen, I owe
you know, three hundred thousand on this, but guess what,
I'm only paying this amount. Why can't they assume that loan?
Why can't you transfer? Well, i'll tell you why. Big
banks don't want that. They want to retire all that shit. Man,
they want to retire all that. This is why it's

(06:49):
a racket. It's not there to benefit you. It's too
big to fail benefiting for this. You could make this
all happen. It's not hard. It's not hard to bring
an actual, true and free market housing here in the
United States without all of the big players, without all
the crony crap, and drive prices down while another big,

(07:11):
big group out there that would hate to see that happen.
That's real estate agents. Oh, they're a big lobby. They
are a massive lobby. How do they make money, Well,
based upon the price of the home that they're selling. You
think they want the price of homes to go down? No, no, no, no,

(07:33):
it's less commission. It's less commission. This is the same
racket that we've discussed before, tying into federal flood insurance
and the fact that we the people subsidize mansions on
the water on the beach a right, because guess what
if they actually had to buy insurance in the free

(07:54):
market be expensive. But no, no, no, no, no, no, no
no no, we're gonna we're gonna have we're gonna have
welfare for rich people and real estate agents they lobby
for that want to keep those prices up. Right, I'm
gonna say it once again, I don't give a rats ass.
Okay if my house, my house drafts thirty four, it
doesn't make any difference to me. Okay, what do I care?

(08:17):
This is part this is part of the crap that
the whole real estate aid industry has been selling people
like your home is some sort of bloody financial asset.
And the same mortgage brokers do the same damn thing too,
to take money out of your house. Do this, do that.
It's a it's a rocket. There's a great scene in
the movie The Big Short Where was I? The Eisman

(08:41):
was playing the part. They're going there to try to
find there in Florida and they're interviewing real estate agent
trying to see if there's a bubble in housing, and
then they interview they end up interviewing a bunch of
mortgage brokers that were you know, they didn't know what
the hell that they were doing. I was bored to
it a couple of weeks ago talking about how they
run the scam. Don't think of your home as this

(09:02):
great financial asset. Okay, it's an installment, plan purchase. It's
a place where you create memories for crying out not loud.
It's a bill you have to live somewhere. Value my
home drops by fifty percent tomorrow. You know how much
gonna affect my life? Zero zero? What can affect my

(09:25):
My house is gonna shrink by fifty percent. No, now,
I'm all gonna go out later on the afternoon. I'm
gonna grow myself something for dinner, Gonna have dinner with
my wife and my mother in law. Maybe the kids
will stop, who knows. Okay, that's how you should engineer
your life, not treating your house as some sort of
financial asset. And it's another thing we gotta throw in

(09:48):
here in this country. Is Financial Literacy Watchdog on Wall
Street dot Com.