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Idea: Foreclosure/Housing Crisis and Affordable Housing Fix

 
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melonrightcoast



Joined: 22 Feb 2009
Posts: 236
Location: metrowest

PostPosted: Sun Feb 22, 2009 8:01 pm GMT    Post subject: Idea: Foreclosure/Housing Crisis and Affordable Housing Fix Reply with quote

I've been thinking ... during the real estate boom, there was lots of talk about affordable housing, and how some workers (ie. retail, teachers, janitorial, firemen, emergency response, etc.) that are essential to our economy cannot afford to buy, or rent, homes.

I haven't heard as much talk as home prices have fallen and become more affordable, which makes sense.

So, I think municipalities should use their stimulus money to purchase foreclosed homes, fix them up, and rent them to qualifying lower-wage earners? Or, sell them as (permanently) affordable homes to qualifying individuals? I think this would especially help in some of the severely affected locations, such as Nevada, Las Vegas, Michigan, and Florida.

That way, the banks won't have to take as big a loss (although I think some should be declared insolvent and dissolved) AND it would be doing these communities a favor in providing housing to workers at the current wage.

That is all I have thought it through ... does anyone have any other thoughts?
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balor123



Joined: 08 Mar 2008
Posts: 1204

PostPosted: Mon Feb 23, 2009 7:32 am GMT    Post subject: Reply with quote

melonrightcoast wrote:
I've been thinking ... during the real estate boom, there was lots of talk about affordable housing, and how some workers (ie. retail, teachers, janitorial, firemen, emergency response, etc.) that are essential to our economy cannot afford to buy, or rent, homes.


Too busy thinking about people who already own that cannot afford to keep their houses.

And by the way, things have gotten bad enough in some places (like Boston) that even more skilled workers like engineers can't afford to buy or rent either. The average engineer makes only a little more ($80k - $100k) than some people in these positions ($70k - $80k).

melonrightcoast wrote:
So, I think municipalities should use their stimulus money to purchase foreclosed homes, fix them up, and rent them to qualifying lower-wage earners? Or, sell them as (permanently) affordable homes to qualifying individuals? I think this would especially help in some of the severely affected locations, such as Nevada, Las Vegas, Michigan, and Florida.


I think this is already happening, however primarily to resell them and to keep surrounding house values from falling. There hasn't been much emphasis on affordable housing because we're trying to use those same people to absorb some of the loss on housing. If we make them stretch to buy houses at current prices, then prices won't fall as much. If we give them an alternative which makes them comfortable, one which would like stimulate the economy as they start consuming again, then housing prices will fall more. Politicians don't see it this way because I think homeowners vote more and any solution which hurts homeowners, even if it helps the economy, isn't an acceptable solution.
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melonrightcoast



Joined: 22 Feb 2009
Posts: 236
Location: metrowest

PostPosted: Mon Feb 23, 2009 6:07 pm GMT    Post subject: housing/affordability Reply with quote

I can see how buying houses at the still currently inflated prices will help the banks, and could possibly put a false bottom on the local housing market.
However, I think it would also help keep property taxes down currently and in the future, which would help homeowners (or voters, as you wish). Maybe it won't work as well here in the Boston area, since there are not as many foreclosures as the hard hit areas.

And I agree that Boston housing prices are messed up ... people are willing to pay way too much for homes here. A house we put a low-ball offer on last month had been on the market since October. The seller didn't even counter so we walked. We just found out that another buyer paid asking price for the house. Even the seller was shocked.
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GenXer



Joined: 20 Feb 2009
Posts: 703

PostPosted: Tue Feb 24, 2009 11:54 am GMT    Post subject: Reply with quote

We do not have to wait long now. The rate of change of unemployment makes the matters worse:

http://data.bls.gov/PDQ/graphics/LASST25000003_49890_1235475481767.gif

Unemployment is only going up. Government is clueless as usual, companies cutting jobs, it is not going to be very long. Yes, people will hold out, but those who can not afford it will not be saved.
What's funny to me is that the 'bailout' for homeowners is a joke - a true socialist style 'spread the wealth' around. The result? Nobody will be saved - this will only prolong the agony for a little bit, but the end result will be the same. You can give everybody 10k, but if they do not have a union job, they will be in trouble whether they get 10k or not.
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melonrightcoast



Joined: 22 Feb 2009
Posts: 236
Location: metrowest

PostPosted: Tue Mar 17, 2009 1:45 pm GMT    Post subject: MA liked my idea :D! Reply with quote

I guess the state of MA liked my idea! They are planning on doing it in New Bedford.

http://www.boston.com/realestate/news/articles/2009/03/17/foreclosed_buildings_to_get_new_lease_on_life/
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