Powell is keeping rates too high and keeping SFR sales low

[John Hassler]

Numbers and Trump don’t mix. He thought his 11,000sf NY Penthouse was 30,000sf. He thinks he got more votes and beat Joe in the 2020 election. Not surprisingly, Trump Co has filed bankruptcy six times. Nope, numbers aren’t his thing.

 

[Essexfenwick]

The new commanders NFL stadium including teardown of old stadium already there and environment cleanup is 2.7 billion. How could the renovation of the FED building possibly cost that much. Really makes the FED seem financially irresponsible.

Now Trump just discovered another building adding another half billion in renovations.


Trump builds ahead of schedule and under budget like the old post office he built while running for president in 2016. These DC guys have never built anything or ran a business. They are like toddlers spending other people's money.

Trump has laid the groundwork to blame any negative economic turn on Powell. He will never fire him .. too valuable as a insurance policy scapegoat. Powell walked right into a trap with his DC dum dum wasting of billions.

 

[Joe Flacco]

$2.5 Billion to renovate the two buildings is a huge number. That is like $6,500 per SF.

 

[RCA]

Ever wonder where SFR rates are currently in Europe?

AI: France: Mortgage rates have averaged around 3.5%–4.2% in mid-2025 for long-term fixed-rate loans, although 25-year loans tend to be priced near the upper end of this range. Rates in France are generally lower than in the UK for principal residences, especially for lower loan-to-value (LTV) ratios and well-qualified buyers. (This is based on recent mortgage market analysis and typical offers in major French high street banks; see inference note.)

England (UK): The average fixed mortgage rates are about 4%–5% as of July 2025, with some lenders offering slightly below 4% for shorter fixed terms at lower loan-to-value ratios. For a 25-year term (which is typical in England), expect rates close to these averages.

Germany: Interest rates for 25-year fixed mortgages are typically in the 3.8%–4.5% range, depending on the provider and LTV. Germany’s rates are somewhat similar to those in France, though slightly higher for longer fixed terms. (Based on German mortgage aggregator data and news commentary up to mid-2025.)

Bloomberg:
Sales of previously owned U.S. homes fell in June to a nine-month low as potential buyers continued to bristle at record prices and high borrowing costs. Contract closings decreased 2.7% in June to an annualized rate of 3.93 million, a report from the National Association of Realtors showed Wednesday. Economists surveyed by Bloomberg expected a 4 million sales rate.

The median sales price increased 2% in June from a year ago to $435,300. Home prices continue to rise even after a recent pickup in inventory.
“Multiple years of undersupply are driving the record high home price. Home construction continues to lag population growth,” Lawrence Yun, NAR chief economist, said in a statement. “High mortgage rates are causing home sales to remain stuck at cyclical lows.”

Houses are not popular in France and Germany, and apartments are. That's one reason mortgage rates are low in France and Germany.

In the US, especially areas like California, - YOU KNOW as soon as mortgage rates dip enough, house sales will skyrocket and prices will surge again - leading to inflation:

"Increasing house prices exert a significant influence on inflation, primarily through indirect mechanisms embedded in standard inflation metrics such as the Consumer Price Index (CPI). In the United States, the CPI measures inflation by tracking changes in the cost of a basket of goods and services, where housing-related expenses—categorized under "shelter"—account for approximately 45% of the core CPI basket. This shelter component does not directly incorporate house prices but instead focuses on rental costs and owners' equivalent rent (OER), which estimates the rental value of owner-occupied homes.

Rising house prices typically lead to higher actual rents over time, as landlords adjust rates to reflect increased property values and maintenance costs. These elevated rents, in turn, feed into the OER calculation, thereby elevating the shelter index and contributing to overall inflation. For instance, recent analyses indicate that housing costs have been a primary driver of persistent inflation, with shelter contributing nearly all of the monthly price increases in certain periods, such as August 2024, when it accounted for 16 basis points out of a 19 basis point rise in core CPI.bidenwhitehouse.archives.gov Excluding housing, core inflation has been notably lower, at around 1.8% annually, compared to 3.2% when included.bidenwhitehouse.archives.gov

Beyond this direct linkage via CPI components, increasing house prices can amplify inflation through secondary effects. Homeowners experiencing wealth gains from appreciating property values may increase consumption, thereby boosting demand for goods and services and exerting upward pressure on prices. Additionally, higher home values facilitate greater borrowing, such as through home equity lines of credit, which can expand economic activity and contribute to inflationary pressures.

However, the impact is not uniform or immediate; there is often a lag between house price increases and their reflection in rental markets, influenced by factors like housing supply constraints, zoning regulations, and demographic trends.

Structural shortages in housing supply have exacerbated these dynamics, sustaining elevated shelter costs even as broader inflation moderates. In summary, while house prices do not directly enter inflation calculations, their upward trajectory has a substantial indirect effect, particularly in economies with tight housing markets."

===>. So, between Tariffs, Mortgage Rates and House Prices AND Inflation Risk, Jerome Powell is justified in being cautious. BUT, Trump will, I would bet, probably succeed in applying enough pressure to get some lowering in the next couple of months.

14 web pages

 

[Joe Flacco]

Reminds me of a cnbc segment from back in the day asking what the White House is worth. Dolly Lenz said $300 million and Serhant said $1 billion.

 

[Essexfenwick]

Numbers and Trump don’t mix. He thought his 11,000sf NY Penthouse was 30,000sf. He thinks he got more votes and beat Joe in the 2020 election. Not surprisingly, Trump Co has filed bankruptcy six times. Nope, numbers aren’t his thing.

Except the DC crowd is 47 trillion in debt. And defaults on debt constantly by printing money and paying creditors with dollars of far less value.

Trump is much better at numbers than that. His attention to numbers has them all crying and freaking out.

 

[Fritz in NY]

Houses are not popular in France and Germany, and apartments are. That's one reason mortgage rates are low in France and Germany.

In the US, especially areas like California, - YOU KNOW as soon as mortgage rates dip enough, house sales will skyrocket and prices will surge again - leading to inflation:

"Increasing house prices exert a significant influence on inflation, primarily through indirect mechanisms embedded in standard inflation metrics such as the Consumer Price Index (CPI). In the United States, the CPI measures inflation by tracking changes in the cost of a basket of goods and services, where housing-related expenses—categorized under "shelter"—account for approximately 45% of the core CPI basket. This shelter component does not directly incorporate house prices but instead focuses on rental costs and owners' equivalent rent (OER), which estimates the rental value of owner-occupied homes.

Rising house prices typically lead to higher actual rents over time, as landlords adjust rates to reflect increased property values and maintenance costs. These elevated rents, in turn, feed into the OER calculation, thereby elevating the shelter index and contributing to overall inflation. For instance, recent analyses indicate that housing costs have been a primary driver of persistent inflation, with shelter contributing nearly all of the monthly price increases in certain periods, such as August 2024, when it accounted for 16 basis points out of a 19 basis point rise in core CPI.bidenwhitehouse.archives.gov Excluding housing, core inflation has been notably lower, at around 1.8% annually, compared to 3.2% when included.bidenwhitehouse.archives.gov

Beyond this direct linkage via CPI components, increasing house prices can amplify inflation through secondary effects. Homeowners experiencing wealth gains from appreciating property values may increase consumption, thereby boosting demand for goods and services and exerting upward pressure on prices. Additionally, higher home values facilitate greater borrowing, such as through home equity lines of credit, which can expand economic activity and contribute to inflationary pressures.

However, the impact is not uniform or immediate; there is often a lag between house price increases and their reflection in rental markets, influenced by factors like housing supply constraints, zoning regulations, and demographic trends.

Structural shortages in housing supply have exacerbated these dynamics, sustaining elevated shelter costs even as broader inflation moderates. In summary, while house prices do not directly enter inflation calculations, their upward trajectory has a substantial indirect effect, particularly in economies with tight housing markets."

===>. So, between Tariffs, Mortgage Rates and House Prices AND Inflation Risk, Jerome Powell is justified in being cautious. BUT, Trump will, I would bet, probably succeed in applying enough pressure to get some lowering in the next couple of months.

14 web pages

All of my travels to visit relatives overseas concur with that. Renting is NOT a socioeconomic problem there. Many are much "happier" as tenants. Unless generational wealth is involved, Renting is not a "problem". So, with that in mind, the interest rates for a 25 year (Normal) mortgage in Europe, is not as crucial as it is here in the States, where all stive to OWN a property and tenants and renters are deemed less important to the lending community.

 

[jhornet88]

Hunter Biden is the smartest person I know . I wonder what he thinks about interest rates ?

 

[John Hassler]

$2.5 Billion to renovate the two buildings is a huge number. That is like $6,500 per SF.

It’s an obscene number to an ordinary person. Question is, how does it compare to other government projects with similar specification requirements? More significantly in terms of current allegations, how or why is the cost related to Powell?

 

[Charles West]

The reason it is costing so much, or one of the reasons, is they want to put in a parking garage beneath the structure, due to building height restrictions. Given the fact that AI will make half the Fed's workforce obsolete, it seems like a dumb idea in the first place, but that's how it rolls.