Image by Gage Skidmore
At a rally in Raleigh, NC, on August 16, 2024, Vice President Kamala Harris announced her first economic policy if elected president: strengthening the economy. Her promises of bringing down the costs of basic goods and services and creating more economic opportunities aim to bring hope to Americans struggling with the cost-of-living crisis.
Harris’ economic policy initiatives are ambitious, and among them are housing policies that aim to make buying a house easy, especially for first-time buyers. One of the aims that Harris proposes with this initiative is to grant four million first-time homeowners twenty-five thousand dollars to assist with down payments on their first home. The stipulation for this offer is that these homebuyers have to have paid rent on time for two years before buying their first home.
Harris’ policy initiatives are not without contention. In a Fox News interview, Kevin O’Leary, the news pundit and businessman, expressed his concerns and doubts. O’Leary claims that her policies are “Soviet-style price control” and that they would be “impossible to implement” and “would never pass Congress.” He bashed Harris for her housing policy, stating that subsidizing down payments on houses would cause inflation since the printing of “free” money would be excessive.
Another problem that these policies raise is whether or not the subsidized twenty-five thousand dollar down payment will help with buying a house since the gap between the median salary and the median price of a house has widened over the past decade. According to a study by Crews Bank & Trust, the average house price is seven and a half times higher than the average family income in the United States, a major increase from the median real estate to income price ratio a decade ago. Following the market crash in 2008, housing prices surged by fifty percent, while hourly wages rose by a mere twenty-three percent.
Although this may pose a problem for Harris, this is where her proposed solution becomes relevant. The money used for down payments by new homeowners would be taken from increased taxes on the rich. Harris plans to increase taxes on the rich by implementing an unrealized gains tax of twenty-five percent for approximately eleven thousand people in the United States who make over one hundred million dollars in investments and assets, according to Al Jazeera. This tax increase on the top earners in the US would bring in an estimated 503 billion dollars in revenue over a decade, according to the same source.
But what is the scope of Vice President Harris’ ambitious housing policy? Along with subsidies for new home buyers, she hopes to make renting easier as well. At her rally in North Carolina, Kamala acknowledged that housing shortages across the country are the catalyst of increasing house prices. She promised to “take down barriers and cut red tape” at the state and local levels to make housing more affordable for all Americans.
Her promises to make housing more affordable include a forty-billion-dollar innovation fund, which is doubling down on the Biden administration’s similar plan worth twenty billion dollars. The purpose of this fund is to “empower local governments to fund local solutions to build housing” and to help Harris achieve her goal of building three million new homes across the United States.
Her plan also aims to lower rent prices for Americans by “boosting housing supply for those without homes,” and enacting housing policies that benefits the renters and prohibits landlords from “ripping off” renters.
According to her campaign’s press release, this will go hand-in-hand with two bills she aims to pass through Congress: the Stop Predatory Investing Act, which would prohibit Wall Street investors from buying rental properties in bulk and marking up prices, and the Preventing the Algorithmic Facilitation of Rental Housing Cartels Act, which helps ‘crackdown’ on landlords and real estate companies that contribute the surging prices of rent across the country.
Expenses like groceries, rent, and other necessities are becoming too expensive for most people. This has become a way of life for most Americans in the past decade. Kamala hopes to be the change that Americans want to see in the White House, and these anti-price-gouging policies are merely the first step.
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