Grant Cardone Slams Biden's $5,000 Tax Credit As Band-Aid Solution To Housing Crisis

Real estate magnate Grant Cardone said a tax credit for first-time homebuyers isn't a solution to the housing affordability crisis. He highlighted that the median monthly mortgage payment is up 78% since 2021 to $2,894.

In a May 12 post on X, Cardone doesn't mince words. He raises the possibility that Biden either lacks an understanding of basic financial mathematics or underestimates the intelligence of the electorate. He suggests that the situation epitomizes career politicians’ detachment from ordinary people’s everyday financial struggles. The detachment arises from their lack of firsthand experience managing personal finances and budgets.

"Is Joe dumb or does he just think his constituents are? Or maybe this is simply a problem with career politicians who have never actually paid bills, run a budget or managed their own money," Cardone posted.

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Biden proposed a mortgage relief credit that would provide middle-class first-time homebuyers with an annual tax credit of $5,000 for each year of two years. The credit is designed to offset the cost of buying a house, which has become unaffordable for middle-income Americans because of high prices and elevated mortgage rates.

But Cardone said it's not just the increase in the monthly mortgage payment that's burdening homebuyers. Insurance, property taxes and private mortgage insurance (PMI) also must be considered.

According to Cardone's calculations, a $35,000 annual mortgage payment would require $5,000 in insurance per year, $5,000 in property taxes, and $8,000 in PMI, for a total annual payment of $63,000. That works out to paying $1.59 million over 30 years, assuming taxes, insurance and maintenance on the house don't increase.

Cardone has been an outspoken critic of several of Biden's tax proposals. He recently aimed the Biden administration's proposed 25% tax on unrealized gains on taxpayers with wealth greater than $100 million. Unrealized gains are an increase in the value of an asset on paper, not a gain through a sale or other event.

If the value of a home or stocks rose $400,000, Cardone said the homeowner or investor would owe $25,000 in taxes, if they didn't sell the asset.

Cardone has also said that supply and demand are impacting home prices, not high interest rates. High interest rates are keeping homeowners with lower rates from selling their houses. They don't want to lose the attractive rates they secured several years ago, which is keeping the supply low.

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