Because of my job I sit on 3 different counties housing boards in my state. The state has a housing crisis as do most states in the US right now. Our governor planned on fixing this by providing funds to make it easier to buy a house by reducing the mortgage amount by up to 30% of the home’s mortgage. So a house that would cost $350k would now cost the buyer $245k. Making it more affordable and obtainable. However the caveat comes with the deed restrictions associated with this purchase. You are being provided an additional loan that will need to be paid off at sale of the home. You also are capped at 1% appreciation yearly. Meaning if the housing market booms and houses go up say 4% a year (which is national average) you can only ever be set at 1%. That 350k home after 1 year only goes up to $353,500. That is just enough to pay off the loan you originally took out . Now there are reductions based on downpayment, upfront money put down, and paying off the loan as you go. But if we just use the raw numbers you’d walk away from the home with $3500 in cash. $3500 for a possible downpayment?
This is the exact legislation that was designed to help fix the housing issue. Instead of any government whether state or federal stopping corporations from purchasing homes and making rentals. We instead throw more money at the issue. What this will create is further financial instability between classes. Those rich enough to afford will continue buying the stock, the poor will lend. When you have a national that has no shared asset you’ll have no money to play with on the top. What I mean by this is if you have entire generations that don’t own any assets in your country and instead just pay debt, the social wealth gap will continue to increase. To a point where A: it crashes and the market is totally destroyed or B: The country falls to ruin because the average citizen can no longer afford essential goods. The United States has been plagued by great depressions before. I fear we are heading to further disparity. China already has systems where they don’t technically own their home the government does. With these continued funding sources now American citizens are in the same boat. You don’t own the house the bank and government subsidized money does. It’s scary when you think about it.
My solution: we need to create a law saying no corporation, llc or business can own single family homes period. We should also say no single individual can own more than 3 homes nationwide. The sad part is those who have the most in housing stock control our laws or pay to control our laws. The issue will forever taint the United States until we all realize everyone at the top is to blame for the housing crisis.
Housed and Fed 