Posted on 04/10/2008 5:44:56 AM PDT by shrinkermd
How, for example?
Fascist, maybe!
Actually, no because there’s a level of freedom to be in one or not, even if there are communities (like mine) where it’s virtually impossible to buy a house that’s NOT in an HOA.
I don’t think so. It just seems that suburban communities are no more so.
Look at it this way: hubs and I are looking for a lakehouse. We found a good buy in a desirable spot. But, I won’t consider it b/c of the crap in everyone’s yards that I have to pass to get into the subdivision.
If they had an HOA, that wouldn’t happen. We have a boat in our driveway we aren’t supposed to have, but our HOA isn’t arbitrary. Now, if it were a car that isn’t running, they’d be all over us.
That's a bit vague. The cost of owning and maintaining a $195,000 home with an 85% mortgage is roughly $12,000-14,000 per year.
Local taxes at the municipal level are usually almost entirely property taxes.
To exceed the cost of owning and maintaining such a home, the local annual property tax assessment would need to be in the neighborhood of $15,000 per year.
I am unaware of any community in the USA where local property taxes are assessed at 7% or more of a home's value annually.
How many folks in your town send their kids to parochial school?
Judging by my neighbors on my block, approximately 40%.
Also, there are two local parochial schools and two local public grammar schools - so my anecdotal evidence would seem to square with local resources.
Of course, no one in my town is compelled by law to send any of their children to public school. They choose to do so.
“Local taxes at the municipal level are usually almost entirely property taxes.”
School district. And if you want your home to retain value or increase value you are very careful to live in the right school district. Even if you have no students, you pay for that.
In concept, yes. But remember that the duties and responsibilities of a condo association — and the rights and responsibilities of a property owner — are clearly specified in a legal property deed.
Perhaps I didn’t make myself clear. In a world where ownership is rare, ownership is by definition concentrated into the hands of the few. Make no mistake, someone will step up and there will be owners of homes and apts. The question you raise is whether that would best be widespread (as it is now) or concentrated (as it would be if most people took your advice). When that concentration exerts its will, uncontrolled rising prices are a function of the market being limited. Unless you envision a Govt. rent-controlled nation, I am pointing out that, unlike ownership, rents will never end and raises will never stop.
Let's face facts: "right school district" means "nice neighborhood."
There is no such thing as a nice house in a safe neighborhood with reputationally terrible schools. As long as the neighborhood is mostly white, safe and prosperous, the schools are officially "good."
No one living in Grosse Point, MI thinks: "It would be great to live in Brightmoor in Detroit, except the local grammar school doesn't have any good foreign language electives."
Okay, explain the trip we take through a bad part of town to get to the AT&T Center. There are houses neat and tidy among trashy ones. Funny thing: the old ladies’ neat and tidy homes never have any graffiti on them.
I'm sure there are.
That doesn't make the area around them any less dangerous and therefore makes the house almost impossible to sell for a good price.
As you stated, the kind of people who inhabit such houses are people who moved in back in 1963 when it was a nice neighborhood, and then never left.
People do not like to buy a nice house flanked by two hovels - especially if it is tiny, like most such houses are.
You’re right, like the lakehouse I won’t buy.
I am a pro at haggling Harris County Appraisal District. I use their own appraisal evidence on them that they have to give you before the appointment. I scored big last year and will again this year. They are puddy in my hands.
Let's assume the taxes on that home are only $4,000 per year right now. At a 5% annual increase that translates to an annual tax of nearly $4,900 after five years, $6,200 after ten years, and more than $10,000 after twenty years. An owner who taxes out an initial 15-year mortgage will have paid off the home by then, while an owner with a 30-year mortgage who accelerates the payments on the loan may owe very little by then.
This is exactly how you end up in a scenario that is faced by many middle-aged to older homeowners in places that rely heavily on property taxes for their revenue. For many of these folks, their taxes exceed their mortgage payments.
This scenario indicates that the homeowner owes very little on his mortgage because of his wise financial choices. It also indicates that the equity in his home has appreciated considerably - if his property taxes have more than doubled, the market value of his home has likely almost doubled, and his equity value at the beginning of his loan has probably tripled.
To return to my original thesis, the suburban scenario of a gainfully employed married couple owning their own home is easily attainable, and wise financial choices over the tenor of a mortgage make homeownership increasingly sustainable.
And over the course of the mortgage, the average American's earning power increases even as his mortgage balance declines.
As long as you stay employed and stay married, homeownership is well within reach for any normal family.
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