How to restore home values, save the environment and cut taxes

[Toronado3800]

The answer is to build fewer homes and yes this is good for the environment and will cut our taxes.

I believe home prices are driven by a combination of supply, demand, and interest rates. Interest rates can not possibly get much lower so that is no help. Demand can only be increased by increasing the number of Americans which will slowly go up.

-We can however help supply while lowering taxes by making conversion of low density "farming" lots to medium density residential more difficult. This will limit the supply of homes on the market thus raising prices.

-How does this lower taxes? Well you will not be paying to build new roads, build new highways or build the other water, electric and sewage infrastructure. I know some of these are quasi-privately operated but tax breaks galore and other funding is given to these projects.

The next point with lower taxes also should gain support of the environmentalists. Fewer neighborhoods will be erected in flood plains if we do not liberally continue to rezone the flood plains and provide public welfare for their construction in these environmentally sensitive areas.

Coupled with lack of flood plain growth is lack of suburban sprawl in general. Urban heat islands contribute to man made global warming if the houses are occupied or unoccupied.

-Also the pro-American military types should be happy with the plan because if the St Louis metropolitan area slows growth near its current sixty mile diameter our commutes will stop getting longer and we will drive up the price of Middle Eastern oil more slowly.

Who should be against this?

Farmers looking to retire by selling their land to developers may loose something. Oh well. Perhaps we should keep the farm land farm land in the event world population continues to grow.

Will folks be forced to buy "out of date" houses? Perhaps to some extent. Eventually this is bound to happen anyway though as we run out of room. I am also not saying "no new houses". Just that I would like to slow the growth.

Any ideas how to implement it? Guess Federal dollars will have to be withheld from states with xx% new housing growth to get the sunbelt in line. Do I feel sorry for developing states? Not really. This is for the benefit of America as a whole. When housing supply sinks building should increase. In my opinion it is big government welfare building roads and infrastructure for developers which makes new housing so attractive.

What do you all think?

 

[ShackledNation]

The prices of homes should never have been so high. The reason they were high was because of inflationary monetary policy. Newly created money flooded the housing market because it was the "next big investment." In reality it was an unsustainable market and it collapsed. Housing prices should not go up. You are correct that new homes should not be built, because many are vacant. And guess what? People aren't building a bunch of new homes. Home production has slowed dramatically, putting the construction industry in one of the worst spots of all sectors of the economy.

Housing prices should never have been so high, and now they are returning to normal. We should not try to restore the unsustainable prices. The market price of a house will clear the housing market. Intervention made prices far too high. You are calling for more intervention to bring them back up to where they should never have gone, which is insane. You don't need government to do anything. When prices are low, that means there is greater supply, and producers will not see the need to produce as many homes.

 

[asterism]

The answer is to build fewer homes and yes this is good for the environment and will cut our taxes.

I believe home prices are driven by a combination of supply, demand, and interest rates. Interest rates can not possibly get much lower so that is no help. Demand can only be increased by increasing the number of Americans which will slowly go up.

-We can however help supply while lowering taxes by making conversion of low density "farming" lots to medium density residential more difficult. This will limit the supply of homes on the market thus raising prices.

-How does this lower taxes? Well you will not be paying to build new roads, build new highways or build the other water, electric and sewage infrastructure. I know some of these are quasi-privately operated but tax breaks galore and other funding is given to these projects.

The next point with lower taxes also should gain support of the environmentalists. Fewer neighborhoods will be erected in flood plains if we do not liberally continue to rezone the flood plains and provide public welfare for their construction in these environmentally sensitive areas.

Coupled with lack of flood plain growth is lack of suburban sprawl in general. Urban heat islands contribute to man made global warming if the houses are occupied or unoccupied.

-Also the pro-American military types should be happy with the plan because if the St Louis metropolitan area slows growth near its current sixty mile diameter our commutes will stop getting longer and we will drive up the price of Middle Eastern oil more slowly.

Who should be against this?

Farmers looking to retire by selling their land to developers may loose something. Oh well. Perhaps we should keep the farm land farm land in the event world population continues to grow.

Will folks be forced to buy "out of date" houses? Perhaps to some extent. Eventually this is bound to happen anyway though as we run out of room. I am also not saying "no new houses". Just that I would like to slow the growth.

Any ideas how to implement it? Guess Federal dollars will have to be withheld from states with xx% new housing growth to get the sunbelt in line. Do I feel sorry for developing states? Not really. This is for the benefit of America as a whole. When housing supply sinks building should increase. In my opinion it is big government welfare building roads and infrastructure for developers which makes new housing so attractive.

What do you all think?

Converting low density farming lots to medium density residential will not save infrastructure costs. More people in any area require more utility provisions, more (and wider) roads, and more water.

Your proposed solution is already being implemented due to market forces. It's cheaper to buy a vacant house than it is to build a new one in most areas.

 

[waltky]

Buyin' a house not such a good investment after all...

Home prices take another dip
August 10, 2011: Home prices slid 2.8% in the second quarter of 2011, according to the National Association of Realtors.

Housing markets struggled through another tough quarter, this time during the spring buying season, the strongest time of year for home sellers. Prices of existing homes fell 2.8% in the three months ended June 30 compared with the same period in 2010, according to a report issued Wednesday by the National Association of Realtors (NAR). For Lawrence Yun, NAR's chief economist, the report was a continuation of a trend that began in 2009. "Median home prices have been moving up and down in a relatively narrow range in many markets, which shows a stabilization trend," he said in a statement. "Markets showing consistent price stability or increases are those with solid labor market conditions, such as in Washington, San Antonio, or Fargo, N.D."

Prices have bounced around a bit the past two years but have wound up in about the same place. The median price for all existing homes sold during the quarter was $171,900, almost matching the price level of all of 2009 -- $172,100. Sales volume was off 5.4% compared with a quarter earlier to an annualized rate of 4.86 million units, and was down 12.7% from the second quarter of 2010. The sales volume decline came despite some of the best buying conditions ever. Interest rates stayed very low throughout the quarter. NAR's Affordability Index -- a calculation based on home prices, interest rates and family income -- was at its third highest level in history, trailing only the preceding two quarters.

The stagnant economy, with a slow recovery in hiring, has hurt sales. Another big headwind is the strict underwriting standards lenders are applying to mortgage applicants in the wake of the financial crisis. There could be "a more rapid sales recovery if banks get back into the business of lending to more creditworthy borrowers," said Yun. There's good reason that buyers are not acting, according to Anthony Sanders, director of real estate entrepreneurship at George Mason University.

"I wouldn't advise anyone to buy at this time," he said. "I felt there was a glimmer of hope that the [Obama] administration and Congress would work together to create jobs again. But after the debt ceiling debate, I'd be scared to death if I was a homebuyer." The latest turmoil in the financial markets, the S&P downgrade of U.S. debt and the increasingly dire budget prospects faced by some eurozone nations could choke off home sales even further, he said.

MORE

 

[signelect]

I think that the key is to buy what you can afford not what your ego wants. People were allowed to finance homes that they did have a chance in Hell of paying for and Freddie and Fannie let them do it and then paid themselves bonuses to boot. The tax payer was worked over by congress. Elect a new President and a new Congress with term limits.

 

[uscitizen]

Why should we restore artificially inflated home "values"?

 

[Brutus]

-We can however help supply while lowering taxes by making conversion of low density "farming" lots to medium density residential more difficult. This will limit the supply of homes on the market thus raising prices.


What do you all think?

absurd since the supply is already enough to last for years! The best way to help the market is get all the forclosures over with tomorrow so the market quickly hits a stable bottom that will in turn produce stable supply, demand and price.

 

[Toronado3800]

-We can however help supply while lowering taxes by making conversion of low density "farming" lots to medium density residential more difficult. This will limit the supply of homes on the market thus raising prices.


What do you all think?

absurd since the supply is already enough to last for years! The best way to help the market is get all the forclosures over with tomorrow so the market quickly hits a stable bottom that will in turn produce stable supply, demand and price.

Brutus, we agreed. I want to removal artificial government support for creating new, extra houses.

You want to have big government force the banks to dump houses they now have in forclosure and take bigger losses on our bailout?

I am amazed by the creativity of your liberal thinking. Banks do a poor job of selling houses. But we probably cant put an ebay like timer on them while demand is soooo low.

 

[Truthmatters]

I think that the key is to buy what you can afford not what your ego wants. People were allowed to finance homes that they did have a chance in Hell of paying for and Freddie and Fannie let them do it and then paid themselves bonuses to boot. The tax payer was worked over by congress. Elect a new President and a new Congress with term limits.

So wealthy people should be made to give up their mansions?

The reason people bought expensive houses is because all houses were expensive.


People were told to buy now because it was going to just get worse.

That is how people were talked into so many sub primes.

they thought they could buy a house and in a couple of years sell it for more than they paid taking that money and putting a down on another house.

To pretend that is not what the market was telling buyers is to lie.

 

[Oddball]

The answer is to build fewer homes and yes this is good for the environment and will cut our taxes.

I believe home prices are driven by a combination of supply, demand, and interest rates. Interest rates can not possibly get much lower so that is no help. Demand can only be increased by increasing the number of Americans which will slowly go up.

-We can however help supply while lowering taxes by making conversion of low density "farming" lots to medium density residential more difficult. This will limit the supply of homes on the market thus raising prices.

-How does this lower taxes? Well you will not be paying to build new roads, build new highways or build the other water, electric and sewage infrastructure. I know some of these are quasi-privately operated but tax breaks galore and other funding is given to these projects.

The next point with lower taxes also should gain support of the environmentalists. Fewer neighborhoods will be erected in flood plains if we do not liberally continue to rezone the flood plains and provide public welfare for their construction in these environmentally sensitive areas.

Coupled with lack of flood plain growth is lack of suburban sprawl in general. Urban heat islands contribute to man made global warming if the houses are occupied or unoccupied.

-Also the pro-American military types should be happy with the plan because if the St Louis metropolitan area slows growth near its current sixty mile diameter our commutes will stop getting longer and we will drive up the price of Middle Eastern oil more slowly.

Who should be against this?

Farmers looking to retire by selling their land to developers may loose something. Oh well. Perhaps we should keep the farm land farm land in the event world population continues to grow.

Will folks be forced to buy "out of date" houses? Perhaps to some extent. Eventually this is bound to happen anyway though as we run out of room. I am also not saying "no new houses". Just that I would like to slow the growth.

Any ideas how to implement it? Guess Federal dollars will have to be withheld from states with xx% new housing growth to get the sunbelt in line. Do I feel sorry for developing states? Not really. This is for the benefit of America as a whole. When housing supply sinks building should increase. In my opinion it is big government welfare building roads and infrastructure for developers which makes new housing so attractive.

What do you all think?

I think you'd make a good Commissar of Housing, tovarich.

 

[iamwhatiseem]

Home prices were so high because the government caused it.
By removing the burden of providing financial proof that you can actually pay the mortgage, as well as removed the burden of making a down payment - this artificially created a HUGE demand for housing.
And when demand goes up....

The entire mortgage crises was caused by the government sticking their noses where they absolutely do NOT belong.

 

[Toronado3800]

Home prices were so high because the government caused it.
By removing the burden of providing financial proof that you can actually pay the mortgage, as well as removed the burden of making a down payment - this artificially created a HUGE demand for housing.
And when demand goes up....

The entire mortgage crises was caused by the government sticking their noses where they absolutely do NOT belong.

Did the government becomming smaller and removing big government regulations which forced banks to require xx% debt to income and xx% down payment cause it?

The previous "comisar or housing" crack was funny and hit home. I worded my initial post poorly. Need to rewrite it later to represent what government will no longer do.

 

[iamwhatiseem]

Home prices were so high because the government caused it.
By removing the burden of providing financial proof that you can actually pay the mortgage, as well as removed the burden of making a down payment - this artificially created a HUGE demand for housing.
And when demand goes up....

The entire mortgage crises was caused by the government sticking their noses where they absolutely do NOT belong.

Did the government becomming smaller and removing big government regulations which forced banks to require xx% debt to income and xx% down payment cause it?

The previous "comisar or housing" crack was funny and hit home. I worded my initial post poorly. Need to rewrite it later to represent what government will no longer do.

Removing those regulations was a crucial part of the whole scheme, and yes it was a scheme.
This is a classic case of what is wrong with big government. They base decisions on politics and idealism rather than reality, and the eventual unintended consequences that arise for such ignorance. The idea was to provide an "opportunity" for lower income people to own a home - sounds great - what a noble cause!
Well...only way to do that is to dramatically lower standard loan practices that banks MUST use to protect their money and everyone's money that has accounts there. So how do you do that? You do what they did - first they strong-armed banks to ignore those practices and backed that up by creating a quasi government-owned business called Fannie and Freddie - and the rest is history.

 

[ShackledNation]

Home prices were so high because the government caused it.
By removing the burden of providing financial proof that you can actually pay the mortgage, as well as removed the burden of making a down payment - this artificially created a HUGE demand for housing.
And when demand goes up....

The entire mortgage crises was caused by the government sticking their noses where they absolutely do NOT belong.

Did the government becomming smaller and removing big government regulations which forced banks to require xx% debt to income and xx% down payment cause it?

The previous "comisar or housing" crack was funny and hit home. I worded my initial post poorly. Need to rewrite it later to represent what government will no longer do.

Government did not become smaller.

 

[waltky]

Home building falls after early-summer rise...

Housing starts slip from already-low levels
8/16/2011 : Building activity remains sluggish as distressed properties flood market

Single-family home construction slowed in July from already-depressed levels as the housing sector showed few signs of coming back to life. Housing starts fell 1.5 percent to a seasonally adjusted annual rate of 604,000 units, the Commerce Department said Tuesday in a report that was in line with estimates. The figure is about half what economists say is needed to sustain a healthy housing market and less then one-third of peak levels from the height of the housing boom in 2005-06.

There was little sign of near-term growth as applications for new building permits also fell 3.2 percent in the month. "There is still no sign yet of a pickup in housing," said Patrick Newport, economist for IHS Global Insight. The weak employment market is delaying a revival in demand for housing he said in substantially downgrading the firm's forecast for housing activity this year.

"Pent-up demand for housing is building as young adults stay at home, and at some point will spark a major revival in housing activity," he said in a note. "But it is becoming harder to see that soon." The report was in line with expectations of analysts, who saw a glimmer of hope in the multifamily segment as more Americans are renting rather than buying homes, spurring demand for new apartments.

Apartment building rose more than 6 percent. Single-family homes, which represent 70 percent of home construction, fell 5 percent.
Advertise | AdChoices Though new homes represent just 20 percent of the overall housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in taxes, according to the National Association of Home Builders.

More Home building falls after early-summer rise - Business - Real estate - msnbc.com

 

[KissMy]

Instead of paying unemployment & welfare we need a WPA type program to hire the unemployed & have them demolish & recycle all vacant buildings or ones owned by Fannie & Freddie that were constructed pre-1930. This would clear land for new urban developments, increase the property value & tax base, prevent urban sprawl, save fuel by reducing urban commuters & energy wasted by old inefficient houses. Leveling old neighborhoods would save on patrol, fire, water, sewer, trash & other city services to those dilapidated neighborhoods. It would improve the community & safety.

 

[ShackledNation]

Instead of paying unemployment & welfare we need a WPA type program to hire the unemployed & have them demolish & recycle all vacant buildings or ones owned by Fannie & Freddie that were constructed pre-1930. This would clear land for new urban developments, increase the property value & tax base, prevent urban sprawl, save fuel by reducing urban commuters & energy wasted by old inefficient houses. Leveling old neighborhoods would save on patrol, fire, water, sewer, trash & other city services to those dilapidated neighborhoods. It would improve the community & safety.

Destroying buildings will grow the economy?

 

[KissMy]

Instead of paying unemployment & welfare we need a WPA type program to hire the unemployed & have them demolish & recycle all vacant buildings or ones owned by Fannie & Freddie that were constructed pre-1930. This would clear land for new urban developments, increase the property value & tax base, prevent urban sprawl, save fuel by reducing urban commuters & energy wasted by old inefficient houses. Leveling old neighborhoods would save on patrol, fire, water, sewer, trash & other city services to those dilapidated neighborhoods. It would improve the community & safety.

Destroying buildings will grow the economy?

It beats the hell out of cash for clunkers that destroyed working automobiles. We have far to many dilapidated old buildings sitting vacant. Broken windows theory shows that dilapidated buildings cause crime. Some neighborhoods have as many or more vacant buildings than occupied ones. Most neighborhoods were built around the same time so most of the buildings are in bad shape. It would be far better to level the area & redevelop it with new schools, homes, parks, pools, shopping & business districts all occupied by high income families living closer to work, schools & shopping.

The demolition & recycling creates lots of jobs. It beats the hell out of paying couch potatoes who develop poor health & tax our Medicaid system.

 

[ShackledNation]

Instead of paying unemployment & welfare we need a WPA type program to hire the unemployed & have them demolish & recycle all vacant buildings or ones owned by Fannie & Freddie that were constructed pre-1930. This would clear land for new urban developments, increase the property value & tax base, prevent urban sprawl, save fuel by reducing urban commuters & energy wasted by old inefficient houses. Leveling old neighborhoods would save on patrol, fire, water, sewer, trash & other city services to those dilapidated neighborhoods. It would improve the community & safety.

Destroying buildings will grow the economy?

It beats the hell out of cash for clunkers that destroyed working automobiles. We have far to many dilapidated old buildings sitting vacant. Broken windows theory shows that dilapidated buildings cause crime. Some neighborhoods have as many or more vacant buildings than occupied ones. Most neighborhoods were built around the same time so most of the buildings are in bad shape. It would be far better to level the area & redevelop it with new schools, homes, parks, pools, shopping & business districts all occupied by high income families living closer to work, schools & shopping.

The demolition & recycling creates lots of jobs. It beats the hell out of paying couch potatoes who develop poor health & tax our Medicaid system.

If the buildings are valueless, then it of course makes sense to tear them down. But why should tax payers fund that? Why should we have to pay to demolish and then create new buildings because other private individuals or the government itself did not take care of them? And you claim that high income people move to these places. I highly doubt these dilapidated buildings are in the parts of town rich people would consider moving to. Also, you insinuate that medicaid costs will go down if we tear down homes. I do not see the logical connection there. Did cash for clunkers lower medicaid costs?

The land should be sold to private individuals so government actually makes money from it. Then private buyers of the land can choose to demolish the buildings if they are that useless, and then create private sector jobs that are actually in line with consumer preference, rather than have government do it and pursue useless projects. If nobody buys from the government, then you can talk about government demolition.

 

[KissMy]

Destroying buildings will grow the economy?

It beats the hell out of cash for clunkers that destroyed working automobiles. We have far to many dilapidated old buildings sitting vacant. Broken windows theory shows that dilapidated buildings cause crime. Some neighborhoods have as many or more vacant buildings than occupied ones. Most neighborhoods were built around the same time so most of the buildings are in bad shape. It would be far better to level the area & redevelop it with new schools, homes, parks, pools, shopping & business districts all occupied by high income families living closer to work, schools & shopping.

The demolition & recycling creates lots of jobs. It beats the hell out of paying couch potatoes who develop poor health & tax our Medicaid system.

If the buildings are valueless, then it of course makes sense to tear them down. But why should government pay to do that? The land should be sold to private individuals so government actually makes money from it. Then private buyers of the land can choose to demolish the buildings if they are that useless, and then create private sector jobs in doing everything you seem to want government to do. If nobody buys from the government, then you can talk about government demolition.

Yes we want as much private sector participation as possible. The government just needs to maintain strict code enforcement to get the private sector wanting to buy into the nice developing neighborhood. Land prices will skyrocket. The government ownes most of the foreclosed property. I have been to many foreclosure auctions & toured many of these buildings. They bring less than $5k at auction & cost $20k to tear down. In most cases the vacant leveled lots bring far more than one with a building on it. The larger the redevelopment the higher the land prices go.

Right now we are paying people to sit on the couch & get fat as hell. How is that helping anyone?