‘No big deal’: Trump downplays possible 50-year mortgages

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US President Donald Trump lowered the 50-year mortgage to make housing more affordable amid concerns from some supporters.

“It just means you pay less every month. You pay it over a long period of time. It’s not like a big factor. It might help a little bit,” Trump told Fox News’ “The Ingraham Angle” program on Monday, blaming his Democratic predecessor Joe Biden and the Federal Reserve’s interest rate policies for home affordability concerns.

Conservative lawmakers, influential in Trump’s Make America Again movement, and economists were among those rejecting the idea, noting that it would take longer for people to actually own their homes. However, some analysts said this could give some investors a boost.

Over the weekend on X, Republican U.S. Representative Marjorie Taylor Green shouted “Forever in debt, in debt for life!” While right-wing activist Mike Crunovich reacted with “mortgage for life”.

Housing affordability is a key issue

Bill Platte, director of the US Federal Housing Finance Agency, said on Saturday that the FHFA was “working” on mortgages five decades longer after Trump, a Republican, posted a picture of himself on social media with the caption “50-year mortgage”.

“A complete game changer,” Pulte wrote on X.

“We are also working on ways to provide relief in 5-year mortgages, 10-year mortgages and 15-year mortgages,” he wrote separately on Sunday, adding that the agency was examining “compulsory or portable mortgages.”

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 cost-of-living increases even as inflation has risen at a slower rate. Prices took center stage in last week’s election that saw Democrats sweep key races as Trump doubled down on his economic agenda.

“I don’t know what they’re saying. I think the polls are fake. We have the greatest economy that we’ve ever had,” Trump told Fox on Monday.

Affordability may remain a challenge for many potential buyers as home prices remain on average around 60% higher than pre-Covid-19 levels.

While home sales rose in September, pending sales unexpectedly remained low despite mortgage rates, which fell after the Fed’s benchmark interest rate cut last month.

Despite the low rates, the housing market has held up, with the first-time buyer age at a record high of 38 last year—well above the late 20s reading that was common in the 1980s.

‘Fix the Supply Side’

Trump has pushed for more tough Fed rate cuts, with Treasury Secretary Scott Besant blaming current rates for causing a recession in the housing sector and White House economic adviser Kevin Hassett on Tuesday saying home prices remain a priority.

According to a briefing on the issue, the US president may address housing and affordability issues in an upcoming executive order.

The average 30-year fixed-rate mortgage rate hit a one-year low of 6.19 percent in January, Freddie Mac data showed last month.

“It’s unclear how much this could lower the monthly payment because we don’t know what interest rates will be compared to a 30-year mortgage,” Daryl Fairweather, Redfin’s chief economist, wrote on X.

TD Securities analysts told investors on Monday that the idea of ​​a 50-year loan could take as little as a year and “only works if there is a commensurate increase in housing supply,” which requires lower construction costs.

By increasing the demand for housing, such mortgages can also drive up house prices, putting them further out of reach for buyers.

Green, who represents a district in Georgia, also said more could be done to qualify tenants for home loans, among other steps.

On the industry, BTIG analysts said the 50-year mortgage could boost firms such as Ellington Financial EFCN, United Wholesale UWMC.TN and Rocket Giants RKTN, which owns Redfin.