Posted on 02/07/2024 8:53:49 PM PST by NoLibZone
What would be some ways to make single-family residential homes more affordable for the next generations?
Can it be done without violating conservative or capitalist values?
“My idea would be for investors to own 49% of a house while the owner occupants own 51%. The owner occupants would have a mortgage covering their 51% share of the purchase price”
Meanwhile, until the house is sold again, what is the 49% investor getting back on their investment? Nothing? A true “investor” would not wait for something, regularly, back on their investment.
And in reality, what you describe is not totally different than a 30 year mortgage itself. For a long period of a mortgage the “owner” holds less of a share (equity) in the house than does the bank/mortgage company. Each earlier mortgage payment is paying more interest and less principle. It takes about 12 years before you start paying off as much or more principle than interest.
A bank/mortgage holder, willing to hold a mortgage for 30 years, to give the buyer “affordable” montly payments, has somewhat made housing more “affordable”. It has also made bigger homes more “affordable” but at the cost of upping home prices generally. That game may have begun to run its course.
“I didn’t say anything of the sort. In fact one proposal I put forth was to eliminate the property tax”
A meaingless proposal without parallel proposals to either reduce local government expenditures and/or raise some other local tax(es). That can’t be left as a separate issue on a call to eliminate the property tax.
“Another solution would be to make the sale of a primary residence 100% tax free. If you bought a $200k home in Los Angeles in 1988 it may be worth say $2 million today (some a lot more some less depending on zip code). After the exemption for a married couple, that sticks them with (if I did the math right) $260,000 in capital gains on federal taxes and around $140,000 in state income taxes. “
An issue at the time of selling a house, is separate from the issue of buying a house and particularly unrelated to the issue of an “affordable” house which is generally an issue of first time buyers (people who have no house to sell to get some equity out of it for a down payment on another house).
That sounds like hell to me!
Stop paying $10 for a cup of coffee ,,? Live thrifty and save..save ...save.
“Bring interest rates down: stop the massive deficit spending and what has become permanent monetary easing”
LOL - Lower interest rates are part of monetary easing. You seem to want one without the other.
Close down all the civilian airports within 100 miles of an “area with a significant homeless population. The US government owns the airspace and can simply close it down. Corporations paying top salaries shun areas without good airline service.”
How does that help create affordable housing????
“Don’t allow large corporations to buy homes”
Yes, in a way, when iterest rates for mortgages was increasing, turning off many buyers, housing prices should have been coming down. But they rarely did and part of the reason is some big companies were buying residential real estate like crazy, which kept home prices up. The big companies, unlike personal home owners, figgured they could pay the 2021,2022, 2023 inflated home prices, rent and hold the properties until mortgage interest rates came down. When mortgage interest rates come down enough, demand (more buyers) will give the big coporate residential property owners big profits.
States could dissallow corporate ownership of single family residential housing. I said “corporate”. Those corporations that have been buying up single family housing used cash, not mortgages. That is different than you or I taking a mortgage on a second home we rent out.
In re: “Eliminate the property tax for one dwelling owners. You could also escalate the property taxes on each additional home owned by a person, family or controlled entity, and while that isn’t exactly a conservative value there could be a pain threshold where it becomes too expensive to own scores of SFRs forcing hoarders to sell. One house is free of tax, second homes is taxed, third home is taxed twice the rate, fourth home is double that etc. Not exactly that, but you get the idea. Again, it’s not a conservative value but making it uneconomical to hold too many SFRs would work to achieve the goal of creating more supply.”
Your shifting of the property tax burden will in time fail to produce sufficient local revenue as fewer and fewer properties will be anything other than the one not taxed property, as it will make less and less sense over time to be among those paying all the property taxes. There is no equity at all in your idea.
They are not unrelated. An older married couple with two kids out of the house may not need or even want all the space anymore. The question is the practicality of downsizing. If it were easier and more economical to downsize and shift to living on more of a fixed income more houses would come on the market.
So it addresses the supply side of the equation.
We bought a house in the Houston metro area (Spring, TX) in the 1980s. We’d take the two Sunday newspapers and review the real estate sections. In both papers there would be a double page open section with a map of the greater Houston area. There be dots on the map with a different number on each dot. Each dot represented not a house but a new housing development. There were over 200. It was the end of a boom in Houston and the begging of a bust. Work took us back to the New York area and in a few years we could neither rent our house in Spring any longer or get it sold (and the house was only 5 years old). After a year of still making the mortgage payments with no sale or renters, we notified the mortgage company we were done. They auctioned it and got just the remaining principle which wiped out all our equity.
The availabiity of housing has less to do with older folks not moving out of the home they have paid off than it is of not enough new, additional homes being built. If not enough additional homes are being built, the market remains too tight even for the older folks wanting to “downsize”. If the new housing supply is growing enough, then whether younger first time buyers or older “downsizing” buyers, its a better housing market.
I don’t disagree. It is a supply and demand question. But there are apples and oranges in the fruit aisle. Younger couples are more likely to need larger homes or at least homes with more bedrooms. Older couples are more likely to need fewer extra bedrooms. The supply and the types of homes both matter in the question of generating more supply overall. The bottom line is more supply should lead to more affordable housing.
I don't want tariffs, just a level playing field. It can be done. Trump renegotiated NAFTA with Mexico and Canada, and I'm open to trade with them for their willingness to do that.
But forcing Americans to compete with slave labor was just plain wrong, regardless of how much money we thought we would save. How are we any better than those slave holding states of the 1860s? The only difference between us and them is that instead of importing the slave labor, we exported the plantations.
Automation has been a much bigger factor than foreign competition in many of those job losses.
If that was true, they could bring back the jobs, use the same amount of automation here, and save on the shipment costs.
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