The mathematics of the MID are dumb; the optics are what sell it. If it lets someone making, say, $100K a year able to spend 30% more on a house payment, it also enables everyone else making 100K/year to pay that much more. So the same people compete for the same houses. Its main effect is to push up the commissions the agents pay and increase the amount of interest banks earn. It doesn't actually help the person buying the house.
Except that if you're in an increasing market it can push the sale price up.
A fetish for home ownership also screws up labor force mobility and reduces the granularity of variations in cost of living (some of which is discussed here). We'd be better off if large, publicly traded corporations owned most of the housing stock and provided it on long term lease (which is almost the situation today, but in the most complicated fashion possible). Then nobody would be "tied to the land".
A reply to my comment is marked dead and I can't revive it, but I can still reply to it:
> So, in effect, large, publicly traded corporations would then own the land, as you describe it? You think that's a good idea?
I don't mean it "in effect" I mean it explicitly. The advantages are large and the risks addressable:
- It spreads ownership around: the shareholders all own the housing stock the corporation owns. Thus they are buffered from the risks of a local market downturn.
- It makes moving easier (if you live in a place that suffers, say, a huge factory closure, you can't sell your house since everybody else wants to do so as well).
- It encourages a variety of housing types (single family to semi detached to large apartment blocks) and again buffers against, let's call it, "style risk").
And frankly when you have a large corp you can regulate some of the most egregious problems like fair housing rules, environmental and code issues, etc. Such companies are likely to be stable equities good for retirement funds etc similar to publicly traded utilities and less like airlines much less high tech businesses.
Except that if you're in an increasing market it can push the sale price up.
A fetish for home ownership also screws up labor force mobility and reduces the granularity of variations in cost of living (some of which is discussed here). We'd be better off if large, publicly traded corporations owned most of the housing stock and provided it on long term lease (which is almost the situation today, but in the most complicated fashion possible). Then nobody would be "tied to the land".