Category: The Washington Free Beacon
How the 30-year mortgage helped create a permanent housing bubble
You won’t hear many people object to President Trump’s executive order to ban corporate purchases of residential homes. The idea sounds like common sense. But it targets a minor symptom while leaving the real disease untouched — and in some respects, it risks making that disease worse.
Institutional home-buying already peaked during the COVID-era bubble and has receded since then. In most markets, corporate ownership represents a small share of total inventory. Even at its height, it never explained why housing costs exploded for everyone else. High prices created the opportunity for institutional buyers, not the other way around.
The goal should not be cheaper debt. It should be cheaper homes.
Government policy inflated the housing market. Institutional buyers simply responded.
During COVID, the Federal Reserve pushed interest rates toward zero. Mortgage rates fell below 3%. At the same time, the Fed bought roughly $2.7 trillion in mortgage-backed securities, and HUD expanded “affordable homeownership” programs that widened the pool of subsidized buyers. Those policies produced predictable results.
When the government offers 2.5% interest for 30 years — often paired with minimal down payments backed by the FHA — buyers flood the market. Sellers respond by raising prices. The bubble becomes a feature, not a bug.
Institutional buyers entered that environment because it looked like easy money. Higher home prices also pushed rents up, so developers built more homes for long-term rental. Both trends flowed from the same source: a government-shaped market that made housing unaffordable, then subsidized the unaffordability.
Trump now seems focused on the symptom — corporate buyers — while ignoring the machinery that inflated the market in the first place.
He has spent months fighting Federal Reserve Chairman Jerome Powell to bring rates back down toward zero. Meanwhile, the Federal Reserve still holds about $2.1 trillion in mortgage-backed securities. Trump has also announced a plan for Fannie Mae and Freddie Mac to purchase another $200 billion in MBS. The stated goal is to lower mortgage rates.
But the goal should not be cheaper debt. It should be cheaper homes.
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Artificially lowering rates props up prices and slows correction. Prices in many markets have begun to soften. That correction should continue. Policies designed to suppress rates will keep prices elevated and risk inflating the next bubble.
That brings us back to corporate home-buying. Even at the COVID peak, institutional buyers — defined as entities owning at least 100 single-family homes — owned about 3.1% of the housing stock. That number has since fallen to around 1%. Investors see the market turning, and they have started backing away.
So Trump’s corporate-purchase ban arrives late, targets a relatively small share of the market, and risks becoming cosmetic cover for policies that keep the bubble inflated.
If Trump wants to drive prices down and permanently realign housing with median incomes, he has to reverse the policies that inflated the bubble. That means attacking the structure, not the headline.
Get government out of the mortgage market. Trump’s next Federal Reserve chair must commit to unwinding the Fed’s mortgage-backed securities portfolio. That $2.1 trillion cushion keeps mortgage rates lower than the market would otherwise set. Those artificially low rates inflate home prices.
End universal “homeownership for everyone” policy. The federal government keeps subsidizing buyers who are not ready to buy. Those programs inject cash into housing demand that would not exist in a real market. The goal should align prices with income, not chase a utopian dream of universal ownership. After decades of subsidies, deductions, and federal credit support, the home ownership rate still sits around the mid-60% range.
Stop chasing near-zero interest rates. A 30-year loan at 2% sounds appealing until you realize what it does to prices. Cheap money bids up homes across the board. Buyers pay the price forever even as politicians brag about the “deal.” Trump should let the market set rates. Recent rate cuts have not restored normal home buying either. Sales remain weak because prices remain too high.
End the 30-year fixed mortgage. Instead of floating longer loans — 50 years? Madness! — the country should move in the opposite direction. Before the New Deal era, short-term mortgages, often three to seven years, dominated the market. Federal policy transformed that structure.
Franklin D. Roosevelt signed the National Housing Act of 1934, establishing the Federal Housing Authority. The FHA insured long-term, fully amortizing mortgages with fixed rates, low down payments, and standardized payment schedules. That system moved the market away from short-term balloon loans and laid the foundation for longer terms.
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Congress eventually authorized the 30-year mortgage in 1954. VA loans under the GI Bill and the expansion of Fannie Mae and Freddie Mac later built a secondary market that made long-term fixed-rate loans attractive to lenders.
Government insurance, guarantees, and liquidity support made 30-year fixed mortgages feasible, which is why they represent 80%-90% of U.S. mortgages today. Without those interventions, lenders would not carry that risk.
The larger point remains simple: Sellers can’t charge prices buyers can’t pay. Prices explode only when government subsidies and government-backed long-term debt expand what buyers can “afford” on paper.
Unwind the subsidies. Unwind the guarantees. Unwind the cheap-money machinery. Let incomes, not federal policy, set the ceiling.
Housing should function like other consumer markets, not be engineered by Washington. Prices should reflect what people earn.
That’s the fix. Everything else treats symptoms and pretends to solve the problem.
Detroit police commissioner turns out to be felon who once threatened to shoot a cop
A recently elected Detroit police commissioner has withdrawn his promise to resign, even after a local news outlet made public his criminal past — as well as his antagonistic interactions with cops.
On December 17, Darious Morris, 38, was sworn in as one of nearly a dozen members of the Board of Police Commissioners, entrusted with overseeing the Detroit Police Department. Morris won the seat representing District 3 on a write-in campaign after no other name appeared on the ballot.
‘If you would have put your hands on him, I would have shot you!’
However, a report from WXYZ-TV just a few weeks later led Morris to consider tendering his resignation.
Morris has a criminal record that extends all the way back to 2009, when he pled no contest to felony fraud and impersonating a public officer charges in connection with what he described as “real estate fraud.”
“It was taking homes from the bank that the bank got foreclosed on people, and we were fraudulently taking the deeds to the homes and deeding them over,” Morris told the outlet.
While he was sentenced to probation in these cases, he was charged with fraud again a year later and wound up behind bars for two years, WXYZ reported. After his release, Morris apparently lived the next 12 years as a law-abiding citizen.
Photo by Scott W. Grau/Icon Sportswire via Getty Images
That sterling record changed in May 2023, when he involved himself in a relatively routine traffic stop of a mini-bike driver in the neighboring city of Warren.
It turns out the bike was not street-legal, and the driver did not have a license, police said. Morris stood at a distance during the stop, claiming he wanted to make sure the cops were acting appropriately.
Morris also seemingly suggested that he was a member of law enforcement, donning a silver police badge purchased online. According to Warren police, Morris falsely told the officers he was a “Detroit Police Department Chaplain at the 9th Precinct.”
Bodycam footage shows one Warren officer ordering Morris: “Stand by the vehicle, please. If you interfere with this stop, understand you are not allowed to.”
After Morris later repeatedly calls the officer an “idiot,” the cop responds, “I’m done. I’m done talking to you,” according to the video.
The officer then attempts to get in his vehicle when Morris cries out: “If you would have put your hands on him, I would have shot you!”
Morris later pled guilty to assaulting, resisting, or obstructing a police officer and was sentenced to probation. He admitted to WXYZ that he had lashed out in “anger,” knowing the remark “would upset” the officer. He also claimed he had not been armed at the time and that he has since apologized to the officer.
‘No matter what was said previously, right now, he’s not resigning.’
Just since his election in November, Morris, who has dubbed himself “the People’s Commissioner,” has rankled local officers with his officiousness, bluster, and accusations of mistreatment.
On December 28, he interrupted police rendering assistance to a drug-overdose victim. “We’re trying to help someone here,” one officer reportedly pleaded with Morris, who was attempting to speak with them.
Morris later filed a complaint against that officer. DPD told WXYZ an investigation into the officer’s actions has been opened.
Morris also caused a scene at a Detroit precinct, refusing to go through a metal detector like all other visitors. When a cop demanded he comply with the policy, Morris shot back, “Put your information on a piece of paper so I can get you wrote up.”
Morris even called for ousting a white Detroit police commander whose precinct he implied is racist.
“A lot of black citizens have been reporting to em that they are being mistreated by officers out of that precinct. I even experienced disrespect by one of their officers,” Morris wrote in a since-deleted social media post, according to the Midwesterner.
“Get rid of Commander Svec immediately!” the post added.
At least one police group has called for Morris to resign, accusing him of spewing “alarming anti-police rhetoric,” attempting to “dox” police officers, and not living up to his promises.
“Upon being sworn in on December 17, 2025, Commissioner Morris stated that he was eager to improve the relationship between the youth of Detroit and the Police Department. Not even a month later, he is instigating citizens against police officers,” National Association of Police Organizations Executive Director William Johnson wrote in a letter to the Board of Police Commissioners.
Photo by Roberto Machado Noa/LightRocket via Getty Images
Shortly after the WXYZ-TV story aired last week, Morris initially agreed to step down from the Board of Police Commissioners. “I already have my city-issued laptop and all my stuff packed up and ready,” he told the outlet, acknowledging that the public may view the BOPC “in an unfavorable light” on his account.
At a press conference Monday, however, Morris’ attorneys walked that resignation pledge back. “No matter what was said previously, right now, he’s not resigning,” insisted Mohammed Nasser.
Of note, Morris could still be in trouble with the law. Back in 2021, weapons charges against Morris were dropped after an officer did not appear at the scheduled hearing, but the office of Wayne County Prosecutor Kym Worthy claimed that those charges may now be refiled.
“We have asked that the case be re-issued. When we receive the warrant request from (Detroit police) it will be reviewed,” spokesperson Maria Miller told the Detroit Free Press.
About these pending weapons charges, Nasser said, “We would certainly advise our client not to resign and allow the criminal case — if it comes — to be addressed in due course. Reissuances do happen. In our practice, we see it all the time. The fact that it is coming many years later, I’ll leave that for everyone to decipher as to what they believe the reason may be.”
The BOPC did not respond to a request for comment from Blaze News.
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