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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: GraceZ who wrote (17281)	2/13/2004 5:57:21 PM
From: David Jones	Respond to of 306849

Ya I've heard those stories before. I don't want my government to be in such a business. They'll muck it up and everyone will lose. When these loans come back I suppose they can discount them to private buyers but they'll force the buyer to continue the farce and sell to another at zero down. These properties will deteriorate into government subsidized housing. The next slums it the loans are not distributed equally across various price ranges. I don't think that's what will happen. The grip is affordable housing, the the problem is inequity in wages. Giving away downs so as to fill the need for affordable housing will push these loans to lower priced lands. And it's my opinion that nothing down equates to keys in the mailbox if and when hard times come along as they always do. It's social engineering by our inefficient government. I'm an advocate of 'affordable housing credits'. The funds of which are collected form builders now but only be used in the city they're collected from. Let other cities, many within shouting distance of cities in need of affordable housing, use these credits (funds) to rehab or build under local governance. Here in California each city is responsible for building it's very low income housing. For many cities this comes down to purchasing expensive property and partnering with a builder. So far I haven't seen it work anywhere for the very low income housing and only to a limited degree of the low income units. You may think what's to stop these cities where the credits would gravitate to, if allowed, from becoming slums themselves? First off I have more confidence in local governments than federal. Second, many of the needed housing units exist but schools, crime and what have you makes them undesirable. Many such units are just as you mentioned. Rentals to the very poor or predatory loans that are given with the knowledge that x percent will come back to repeat the process. Let these credits be used for purpose of rehab or even school construction. And third, these credits will go further in areas of lower land costs. There should to be limits as to physical distance and transportation considerations before the transfer of such credits. And may variables I haven't thought of and it maybe plainly a bad idea? It's complicated this need for very low income housing but giving away downs is giving away money if a high percentage default which is what I expect. I hope I'm proved wrong.