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Joined: Tue September 24, 2013 5:56 pm Posts: 47166 Location: In the oatmeal aisle wearing a Shellac shirt
You know how many small developers here took out constructions loans when rates were cheap, sold homes on spec, then had to declare bankruptcy when Covid drove the costs through the roof and their profit margins into the toilet? Everyone’s saying “not enough housing,” yet there’s ample vacancies/zombie developments in some parts of the country.
I tend to think of this issue along a 20-year horizon, and any immediate solutions are probably pipe dreams.
Joined: Tue September 24, 2013 5:56 pm Posts: 47166 Location: In the oatmeal aisle wearing a Shellac shirt
McParadigm wrote:
tragabigzanda wrote:
McParadigm wrote:
While I’m generally pretty quick to dismiss predictions or assumptions of success (versus demonstrated historical evidence), I think your solution seems obviously destined to work. It sounds really, really good.
It also sounds like the answer to my (much less important) question is “no, there isn’t any part of the country we can point to that has spent the last 4 years achieving provable reductions in this problem through their currently enacted policies.”
Well your question is poorly formed, because it presumes there's a single set of policies that would A) work in one place, and therefore B) be transferrable to another place. So that's what I was responding to.
I’m not accusing you of not answering my question. I asked it because this topic usually boils down to blues and reds attacking each other for failing to solve the problem, without bothering to address their own lack of successes. Lots of “lmao look at how these people are doing it wrong,” and very little self-reflecting.
I was and am curious if anybody has an “everyone should be looking to this working model for guidance” example that shows a provable difference being made. But I also agree that your approach would succeed, which is why I referred to my question as much less important.
Genuinely sorry, I detected a couple notes of sarcasm that apparently weren’t there.
I live in an affordable housing program. Deed restricted and meant for local workers only. No airbnb. Has to be primary residence and have to work in the county. Living in eagle county - however - may not be the appropriate model for the world at large but it has been a successful program that has provided opportunities for local population get into homeownership and enjoy those benefits.
Me and trag disagree on some of the restrictions in place but it has been well received here and I'm about to sell and walk away with significant equity - relatively speaking.
Joined: Tue September 24, 2013 5:56 pm Posts: 47166 Location: In the oatmeal aisle wearing a Shellac shirt
Strat wrote:
I live in an affordable housing program. Deed restricted and meant for local workers only. No airbnb. Has to be primary residence and have to work in the county. Living in eagle county - however - may not be the appropriate model for the world at large but it has been a successful program that has provided opportunities for local population get into homeownership and enjoy those benefits.
Me and trag disagree on some of the restrictions in place but it has been well received here and I'm about to sell and walk away with significant equity - relatively speaking.
Oh I fully support these types of programs and their general orientation. As we've discussed offline, I think some of the specific restrictions on your abilities to diversify your real estate holdings if/when you've outgrown the home are overly prohibitive.
Begs the question: have any states spent the last 4 years getting it right? Has any state used policy to produce a demonstrable change in the percent of income spent on rent? Or does it just come down to, how many people are there per square mile in the area you want to move into?
I don't think there's a single-scale solution. It will require various interventions at the Federal/State/County/Local levels, plus active participation from the private sector. Just spitballing here:
Federal: -intervene in PE purchases of real estate -Create a second round of qualified opportunity zone eligibilities (this is in the pipeline) -Figure out an immigration and naturalization pathway that pumps tax-accountable juice into the construction labor force -Federal minimum wage hike
State: -Cede control back to the local governments where applicable (mostly red states) -Create low-interest debt funding pools for targeted construction loans
County: -Overhaul zoning codes for rural areas that lack the government knowledge to even make sense of a zoning plat or request for variance (this is huge, in my experience)
City: -Limit or ban AirBnB/VRBO within certain parameters -Allow for mixed-use development -Figure out the ADU prohibitions that make sense for your municipality
Private industry: -Stop trying to apply venture capital to f'n real estate -Create opportunities for employee participation in enterprise upside
Waaay out of my depth here but it looks like you are suggesting tweaking the supply of affordable housing without accounting for how to slow demand or the economic sustainability of what is built. I think McP's question is important, and I think the answer is no, and I think the answer is no because government regulation is not good at handling supply and demand together.
One thing I've wondered about is changing the structure of federally backed mortgages. If all loans had to be fixed rate, straight-line amortization, and all had to be re-amortized once a year or the feds wouldn't buy or back them, wouldnt that help build equity in existing homes giving people a reason to stick in their home (good for community, family, etc) and a lifeline to borrow against should a periodic of economic difficulty arise such as a major medical incident? If people can afford to stay in their homes then the demand for new affordable homes goes down making any supply increases have greater impact.
_________________ "The fatal flaw of all revolutionaries is that they know how to tear things down but don't have a f**king clue about how to build anything."
Joined: Tue September 24, 2013 5:56 pm Posts: 47166 Location: In the oatmeal aisle wearing a Shellac shirt
Bi_3 wrote:
tragabigzanda wrote:
McParadigm wrote:
Begs the question: have any states spent the last 4 years getting it right? Has any state used policy to produce a demonstrable change in the percent of income spent on rent? Or does it just come down to, how many people are there per square mile in the area you want to move into?
I don't think there's a single-scale solution. It will require various interventions at the Federal/State/County/Local levels, plus active participation from the private sector. Just spitballing here:
Federal: -intervene in PE purchases of real estate -Create a second round of qualified opportunity zone eligibilities (this is in the pipeline) -Figure out an immigration and naturalization pathway that pumps tax-accountable juice into the construction labor force -Federal minimum wage hike
State: -Cede control back to the local governments where applicable (mostly red states) -Create low-interest debt funding pools for targeted construction loans
County: -Overhaul zoning codes for rural areas that lack the government knowledge to even make sense of a zoning plat or request for variance (this is huge, in my experience)
City: -Limit or ban AirBnB/VRBO within certain parameters -Allow for mixed-use development -Figure out the ADU prohibitions that make sense for your municipality
Private industry: -Stop trying to apply venture capital to f'n real estate -Create opportunities for employee participation in enterprise upside
Waaay out of my depth here but it looks like you are suggesting tweaking the supply of affordable housing without accounting for how to slow demand or the economic sustainability of what is built. I think McP's question is important, and I think the answer is no, and I think the answer is no because government regulation is not good at handling supply and demand together.
One thing I've wondered about is changing the structure of federally backed mortgages. If all loans had to be fixed rate, straight-line amortization, and all had to be re-amortized once a year or the feds wouldn't buy or back them, wouldnt that help build equity in existing homes giving people a reason to stick in their home (good for community, family, etc) and a lifeline to borrow against should a periodic of economic difficulty arise such as a major medical incident? If people can afford to stay in their homes then the demand for new affordable homes goes down making any supply increases have greater impact.
First part: I'd argue the demand is perceived as being for "home ownership," but really it's more about an achievable path to upward mobility and economic stability in retirement and elderly phases of live; I think there are all sorts of other solutions that could drive that, some of which I've addressed in that long post, others not. As for "economic stability of what is being built," I don't think it was ever designed to be "stable" from a macro-economic scale; the better approach is probably to develop a system that is both adaptable and resilient to shifting demographics and regional SWOT.
Second part: I love this idea in theory. I have no idea what impact such a measure might have on the banking system at large.
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