IN THE NEWS: Deng discusses 50-year mortgages and affordable housing with Bridge Michigan

In a recent Bridge Michigan article on how Michigan could be impacted by President Donald Trump’s endorsement of establishing a 50-year mortgage, Taubman College’s Lan Deng said the state’s housing shortage and rising home prices will take more than lower monthly payments to fix.

“The issue about housing affordability is that the housing cost is far higher than what most households can afford,” said Deng, professor of urban and regional planning. “[A 50-year mortgage] does not directly tackle the dysfunctional housing markets we are seeing.”

In the article, Deng lists rising construction costs and land values, as well as a shortage of laborers, as factors contributing to the housing shortage, and notes that national trends of a growing gap between household income and housing costs are also affecting the state.

To make housing more attainable, Deng said Michigan needs to diversify the types of housing built and that recent efforts to invest in affordable housing are a step “in the right direction.”    

“Only new units you can build will help relieve market pressure,” she said.

Deng also expressed doubt that lenders would be confident in the ability of aging first-time home buyers to repay a 50-year mortgage, asking, “Do people even want to work into their 70s – even 80s – if people are buying their property in their 30s?”

Read the full article at Bridge Michigan.