Comments on: Habitat for Humanity http://crookedtimber.org/2005/02/15/habitat-for-humanity/ Out of the crooked timber of humanity, no straight thing was ever made Sat, 26 May 2012 14:59:12 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: frisbeedog http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61532 frisbeedog Wed, 16 Feb 2005 22:04:30 +0000 http://crookedtimber.org/wp/?p=2873#comment-61532 I read Crooked Timber 3 or 4 times a week, but generally don't check the comments section. This is one of the most intelligent and educational discussions I have witnessed in several years. I wish YOU guys were the pundits on TV and radio.... Thank you I read Crooked Timber 3 or 4 times a week, but generally don’t check the comments section. This is one of the most intelligent and educational discussions I have witnessed in several years. I wish YOU guys were the pundits on TV and radio…. Thank you

]]> By: decon http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61531 decon Wed, 16 Feb 2005 19:32:33 +0000 http://crookedtimber.org/wp/?p=2873#comment-61531 It's H for H's decision. But someone might mention the concept of a shared appreciation mortgage (SAM) to them. I would imagine a 30 year SAM with H for H's share of the appreciation decling over time would be superior in many ways to the current 20 year cliff. One example of the SAM in action: http://www.pdc.us/housing_serv/single_family/samp.asp It’s H for H’s decision. But someone might mention the concept of a shared appreciation mortgage (SAM) to them. I would imagine a 30 year SAM with H for H’s share of the appreciation decling over time would be superior in many ways to the current 20 year cliff. One example of the SAM in action: http://www.pdc.us/housing_serv/single_family/samp.asp

]]> By: Thomas http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61530 Thomas Wed, 16 Feb 2005 18:32:24 +0000 http://crookedtimber.org/wp/?p=2873#comment-61530 pat, if that's the case, then I'm ever more enthusiastic for the federal tax cuts. My property taxes haven't gone up nearly so much. The suggestion that property taxes in Md are tied closely to federal tax rates and revenues could be interpreted to mean that too much of my money was going to Md. pat, if that’s the case, then I’m ever more enthusiastic for the federal tax cuts. My property taxes haven’t gone up nearly so much. The suggestion that property taxes in Md are tied closely to federal tax rates and revenues could be interpreted to mean that too much of my money was going to Md.

]]> By: Steve LaBonne http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61529 Steve LaBonne Wed, 16 Feb 2005 18:29:56 +0000 http://crookedtimber.org/wp/?p=2873#comment-61529 No, Pat, that answer won't do. These are not deliberate tax increases voted (by the taxpayers or their elected representative)to fill particular needs- they're a pure, unplanned windfall from rising property values, and consequently a high risk to generate more waste than socially useful spending. No, Pat, that answer won’t do. These are not deliberate tax increases voted (by the taxpayers or their elected representative)to fill particular needs- they’re a pure, unplanned windfall from rising property values, and consequently a high risk to generate more waste than socially useful spending.

]]> By: Pat http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61528 Pat Wed, 16 Feb 2005 17:25:28 +0000 http://crookedtimber.org/wp/?p=2873#comment-61528 <blockquote>It is insane for someone’s property taxes to double in 18 months. Where is all that money going?</blockquote> Your federal tax cuts in action.
It is insane for someone’s property taxes to double in 18 months. Where is all that money going?
Your federal tax cuts in action.

]]> By: Michael H. http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61527 Michael H. Wed, 16 Feb 2005 15:11:33 +0000 http://crookedtimber.org/wp/?p=2873#comment-61527 One more comment on this issue. I asked Karen Cleveland director of Habitat of Humanity of Northern why they would not approve a home equity loan for Mrs. James. She wrote back say that, in fact, they did (why was this not reported in the Post?) This fact completely undercuts the argument that she needs tax abatement. Her home is worth 50% more than assessed value of the home when she bought it (for much less than the assessed value), real estate taxes are 1% of the assessed value of the home, so she can borrow against the equity of the home and still net a huge windfall profit at the end of the 20 year mortgage. Also, the $950 per month she pays currently for mortgage and taxes would not even be enough to rent a small studio apartment in Alexandria. Mrs. James certainly does not deserve another windfall profit in the form of tax abatement. One more comment on this issue. I asked Karen Cleveland director of Habitat of Humanity of Northern why they would not approve a home equity loan for Mrs. James. She wrote back say that, in fact, they did (why was this not reported in the Post?) This fact completely undercuts the argument that she needs tax abatement. Her home is worth 50% more than assessed value of the home when she bought it (for much less than the assessed value), real estate taxes are 1% of the assessed value of the home, so she can borrow against the equity of the home and still net a huge windfall profit at the end of the 20 year mortgage. Also, the $950 per month she pays currently for mortgage and taxes would not even be enough to rent a small studio apartment in Alexandria. Mrs. James certainly does not deserve another windfall profit in the form of tax abatement.

]]> By: Ophelia Benson http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61526 Ophelia Benson Wed, 16 Feb 2005 03:56:50 +0000 http://crookedtimber.org/wp/?p=2873#comment-61526 "This seems to deprive the recipients of one of the main benefits of homeownership: capital appreciation." It's called Habitat for Humanity, not Speculation for Humanity, not Windfall Profit from Inflated Real Estate Prices for Humanity, not Make a Killing and Help Drive Other Poor People Out for Humanity. Not even, strange as it may seem, Capital Appreciation for Humanity. This whole (tax exempt) capital appreciation thing which people now seem to think is a part of nature is why it's so hard for non-rich people to buy a little habitat in the first place. “This seems to deprive the recipients of one of the main benefits of homeownership: capital appreciation.” It’s called Habitat for Humanity, not Speculation for Humanity, not Windfall Profit from Inflated Real Estate Prices for Humanity, not Make a Killing and Help Drive Other Poor People Out for Humanity. Not even, strange as it may seem, Capital Appreciation for Humanity. This whole (tax exempt) capital appreciation thing which people now seem to think is a part of nature is why it’s so hard for non-rich people to buy a little habitat in the first place.

]]> By: Cranky Observer http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61525 Cranky Observer Wed, 16 Feb 2005 03:25:46 +0000 http://crookedtimber.org/wp/?p=2873#comment-61525 > sad uncooperative game being played > by Habitat for Humanity and Mrs. > James. It is a game that squanders > the potential bonus of the rising > real estate value of Mrs. James’ > home. If you accept the premise that the higest purpose of a house is to capture rising "value", sure. > Habitat for Humanity wants to do > what is impossible: produce > affordable housing in Northern > Virginia. "Impossible" as long as you ignore the fact they they have done it, yes. Cranky > sad uncooperative game being played > by Habitat for Humanity and Mrs. > James. It is a game that squanders > the potential bonus of the rising > real estate value of Mrs. James’ > home. If you accept the premise that the higest purpose of a house is to capture rising “value”, sure. > Habitat for Humanity wants to do > what is impossible: produce > affordable housing in Northern > Virginia. “Impossible” as long as you ignore the fact they they have done it, yes. Cranky

]]> By: Michael H. http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61524 Michael H. Wed, 16 Feb 2005 02:17:47 +0000 http://crookedtimber.org/wp/?p=2873#comment-61524 Sorry, that link was messed up a little: http://chocolateandgoldcoins.blogspot.com/2005/02/habitat-for-market-failure.html Sorry, that link was messed up a little: http://chocolateandgoldcoins.blogspot.com/2005/02/habitat-for-market-failure.html

]]> By: Michael H. http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61523 Michael H. Wed, 16 Feb 2005 02:14:20 +0000 http://crookedtimber.org/wp/?p=2873#comment-61523 If the above thread has not quenched your thirst for the issues htmlraised in this post, take a look at my post on this subject: http://chocolateandgoldcoins.blogspot.com/2005/02/habitat-for-market-failure If the above thread has not quenched your thirst for the issues htmlraised in this post, take a look at my post on this subject: http://chocolateandgoldcoins.blogspot.com/2005/02/habitat-for-market-failure

]]> By: raj http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61522 raj Tue, 15 Feb 2005 20:13:28 +0000 http://crookedtimber.org/wp/?p=2873#comment-61522 The rationale for the resale restriction was described upthread, but I am wondering about the property tax question. Are the HfH properties that are still under the resale restriction taxed at full value--without regard to the resale restriction? It strikes me that the value of the property may be substantially reduced because of the resale restriction, and, as a result, the value of the property should be reduced accordingly. The rationale for the resale restriction was described upthread, but I am wondering about the property tax question. Are the HfH properties that are still under the resale restriction taxed at full value—without regard to the resale restriction? It strikes me that the value of the property may be substantially reduced because of the resale restriction, and, as a result, the value of the property should be reduced accordingly.

]]> By: gmoke http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61521 gmoke Tue, 15 Feb 2005 19:56:03 +0000 http://crookedtimber.org/wp/?p=2873#comment-61521 Sounds like H for H is working on a limited equity tip, common for low and moderate income housing in order to make sure that people use housing as housing and not as investment. Sounds like H for H is working on a limited equity tip, common for low and moderate income housing in order to make sure that people use housing as housing and not as investment.

]]> By: Chuchundra http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61520 Chuchundra Tue, 15 Feb 2005 19:26:59 +0000 http://crookedtimber.org/wp/?p=2873#comment-61520 It is not a wise to take on capital debt to finance operating expenses, e.g. a home equity loan to pay property taxes. It is not the intention of HFH to provide a store of equity for their homeowners to tap into to finance a new business or job training or whatever. Their mission is solely to provide a decent place for them to live. It is insane for someone's property taxes to double in 18 months. Where is all that money going? It is not a wise to take on capital debt to finance operating expenses, e.g. a home equity loan to pay property taxes. It is not the intention of HFH to provide a store of equity for their homeowners to tap into to finance a new business or job training or whatever. Their mission is solely to provide a decent place for them to live. It is insane for someone’s property taxes to double in 18 months. Where is all that money going?

]]> By: anon http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61519 anon Tue, 15 Feb 2005 19:17:13 +0000 http://crookedtimber.org/wp/?p=2873#comment-61519 "At least a dozen of the 47 Habitat homeowners in Northern Virginia pay more in property taxes and insurance than they do to pay off their mortgages." How uncommon is this, really, in a period in which interest rates are so low, local governments are required to do more with less, and housing prices are increasing? I know I pay more in property + school taxes than my mortgage (even without adding city and county sales taxes to the tax side of the ledger), and I suspect most of my neighbors do, too. “At least a dozen of the 47 Habitat homeowners in Northern Virginia pay more in property taxes and insurance than they do to pay off their mortgages.” How uncommon is this, really, in a period in which interest rates are so low, local governments are required to do more with less, and housing prices are increasing? I know I pay more in property + school taxes than my mortgage (even without adding city and county sales taxes to the tax side of the ledger), and I suspect most of my neighbors do, too.

]]> By: Cranky Observer http://crookedtimber.org/2005/02/15/habitat-for-humanity/comment-page-1/#comment-61518 Cranky Observer Tue, 15 Feb 2005 19:12:38 +0000 http://crookedtimber.org/wp/?p=2873#comment-61518 Michael, I thought this had been covered fairly well in previous posts. If one assumes that the core purposes of a house are wealth accumulation and capital gains, then your analysis applies. But if you assume that the core purposes of a house are to provide decent shelter for a family and to be part of the basis of a neighborhood, then mortgaging them to the hilt as soon as possible is not a wise strategy. Cranky Michael, I thought this had been covered fairly well in previous posts. If one assumes that the core purposes of a house are wealth accumulation and capital gains, then your analysis applies. But if you assume that the core purposes of a house are to provide decent shelter for a family and to be part of the basis of a neighborhood, then mortgaging them to the hilt as soon as possible is not a wise strategy. Cranky

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