This is the Cato Daily Podcast for Friday, June 4th, 2021.

I'm Caleb Brown.

Some members of Congress are hoping to spend big to help

first-time homebuyers get that all-important down payment together, but in a hot housing market

where supply is the main problem, it's hard to see the benefits of such a policy.

Nolan Gray is a housing researcher at the University of California. We spoke this week.

The housing market went on kind of a, I don't know, wild roller coaster adventure during this pandemic.

A lot of houses just magically vanished off the market in March

2020. People thought well we'll just we'll just wait this out and for those that

remained on the market, prices, generally, especially in densely populated urban areas, shot up.

And now that we hope the pandemic is waning and ending, maybe we'll get back to something more normal,

but there are members of Congress right now who, and we should note, normal wasn't great.

And now Maxine Waters and some other members of Congress would like to see the federal government

play a direct role in helping first-time homebuyers put together a down payment.

I know what you're going to tell me, but I want you to tell me anyway.

Why is that such a terrible idea?

Well, first, thanks so much for having me. But, you know, as you sort of say, we're right in the

middle of a perfect storm with respect to housing markets.

According to the Kays Schiller, U.S. Housing Price Index, prices in March of 2021 are up, you know,

over 13 percent over last year. You know, in many sub-markets, so here in California, home prices are up 17%.

You know, even in historically affordable places like cities in Texas of course you have housing prices up there

Part of that is is people moving

...