A low cost of capital for homebuyers (from subsidized mortgages) is misleadingly framed as a consumer benefit because it artificially raises house prices; the real comparison is buying a house with a subsidized $200,000 mortgage versus an unsubsidized $180,000 mortgage, with the distributional benefits depending heavily on timing.

causalpending

Speaker

Russ Roberts

Evidence Quote

that low cost of capital for homebuyers helps raise the price of houses artificially

Source

Arnold Kling on the Unseen World of Banking, Mortgages, and Government 07/5/2010EconTalk
Created: 6/13/2026, 7:04:06 PM

My Notes

Loading notes...