In a recent interview on Fox Business’ “Mornings with Maria,” Grant Cardone, CEO of Cardone Capital, issued a stark warning about the state of the U.S. housing market. Speaking with host Maria Bartiromo, Cardone expressed deep skepticism about the possibility of solving the housing affordability crisis in America, citing entrenched issues that make it unlikely for prices to become accessible for the average American anytime soon.
The Persistent Seller-Buyer Gap
Cardone began by addressing the ongoing disparity between sellers and buyers in the housing market. Despite fluctuations in interest rates, with the 30-year mortgage rate recently dropping to 6.54%, he noted that home prices have remained stubbornly high. “Until interest rates breach 4% or go back below 4%, you’re not going to see the volume necessary to unlock the supply-demand formula,” Cardone explained. This gap, according to him, is preventing the market from correcting itself, leaving many potential buyers unable to afford homes.
A Shift Toward Rentals: Cardone’s Investment Strategy
Given the challenges in the housing market, Cardone advocated for a focus on rental properties as a more viable investment. He emphasized that with the current economic conditions, rental apartment communities are likely to remain a strong investment for the next few decades. “That’s why I’m pro-rental apartment communities for investment properties,” Cardone stated, pointing to the enduring demand for rentals in a market where homeownership is increasingly out of reach for many.
The Policy Dilemma: Trump vs. Harris
The discussion also touched on the potential impact of future political leadership on the housing market. Bartiromo and Cardone explored the implications of a possible presidency under either Donald Trump or Kamala Harris. Cardone was critical of Harris, predicting that her administration would likely continue policies that he believes have exacerbated the housing crisis – namely, more regulations, higher taxes, and increased penalties for property owners. In contrast, Cardone suggested that a Trump presidency would benefit property owners through deregulation, lower taxes, and greater predictability in the market.
The Flight from Blue States
Cardone highlighted a growing trend of migration from high-tax, heavily regulated “blue states” like California and New York to states with more favorable conditions for property owners, such as Florida and Texas. He warned that if Harris were to win the presidency, this exodus could accelerate, with states like Florida and Texas standing to gain the most. “If she wins, they will be massive beneficiaries,” Cardone predicted, noting that these states offer better protection for property owners and more stable investment environments.
Housing Affordability: A Problem Without a Solution?
One of Cardone’s most striking statements was his assertion that housing affordability in America is a problem that cannot be fixed. “Housing cannot be fixed in this country no matter what anyone does,” he declared, pointing to the widening gap between mortgage payments and rents, particularly in major cities like San Francisco, New York, and Chicago. Cardone argued that despite all the talk of affordable housing, the reality is that housing in these areas has only become less affordable over time.
Hopes for Lower Interest Rates
Despite his grim outlook, Cardone did express some hope that a shift in the political landscape could bring about more favorable conditions for the housing market. He speculated that if Donald Trump were to return to the presidency, interest rates could drop significantly, possibly to as low as 2%, which could reignite the housing market. “Hopefully Donald Trump gets in there, and a year from now I predict we’ll see 2% interest rates and we’ll see housing rocking again in this country,” Cardone said, though he acknowledged that this is far from certain.
Financial Literacy and Wealth Creation
Beyond housing, Cardone and Bartiromo discussed the broader issues of financial literacy and wealth creation in America. Cardone emphasized the importance of educating Americans about wealth-building strategies, lamenting that such education has been lacking since George W. Bush’s presidency. He called for a renewed focus on teaching financial literacy, not just to the middle class but across all income levels, to help more people achieve financial independence.
“Affordable Housing Will Become Unaffordable”
People in the comments shared their thoughts: “Owning property can provide a steady income stream during retirement, and the value of the property itself tends to appreciate over time.”
One person added: “Ban large corporations from buying single family homes”
Another commenter said: “If anything, it’s likely to get worse. Affordable housing will soon become unaffordable. Therefore, I advise taking action now because today’s prices will seem like bargains tomorrow. Until the Fed takes more decisive action, I expect we will see hysteria due to rampant inflation. You can’t just halfway rip the band-aid off.”
A Sobering Reality Check
Grant Cardone’s interview with Maria Bartiromo offers a sobering reality check on the state of the U.S. housing market and the broader economic challenges facing the country. His warnings about the difficulties of fixing housing affordability, coupled with his concerns about future political leadership, underscore the complexities of the issues at hand. As the nation looks to the future, Cardone’s insights serve as a reminder of the deep structural challenges that need to be addressed if the American Dream of homeownership is to remain attainable.
Beyond Repair?
What do you think? Is the housing affordability crisis in America truly beyond repair, or are there innovative solutions that could address the widening gap between home prices and incomes? How might a significant shift in political leadership, such as a Trump or Harris presidency, impact the future of the housing market and property ownership in the United States? With the increasing focus on rental properties as a viable investment, what are the long-term implications for the traditional American Dream of homeownership?
For an in-depth look, view the complete video on Fox Business’ YouTube channel here.
