Tuesday, September 30, 2008

As if we didn't have enough problems...

So you know this current crisis we are going through, because some well-intentioned (and some not so well-intentioned), but ridiculously naive legislators decided it would be nice to make affordable housing, forcing banks to take on risky debts, driving up the housing market because so many new homeowners were entering it, making housing now less affordable and mortgages even higher?

You with me here?

Okay, so what does the current mayor of Los Angeles think would be a good idea right now?

Mayor Antonio Villaraigosa unveiled a $5 billion plan to provide 20,000 affordable homes in the city over the next five years, but acknowledged he'll have to reach far and wide to raise the funds amid the financial meltdown.

Hmmm…$5 billion divided by 20,000….$250,000. Seriously? You are going to put people into quarter of a million dollar homes? Granted in Los Angeles that doesn’t mean much now, but still…that’s a big chunk of money.

This is the least affordable big city in America," the mayor said at a press conference Monday. "I'll go to Washington and New York. I'll go to the Middle East, to China. We'll knock on every door that we have to."

Oh, so because we can’t afford this at home in the US, and because no one is going to lend him the money, he’s going to, get this, China and the Middle East to get loans…genius.

It gets even better:
One of the plan's more controversial elements is likely to be a requirement that developers set aside 12.5 percent to 22.5 percent of projects with more than 20 units for low- or moderate-income residents.

So, the way they are going to make it work, is by forcing developers to make this housing, which is a tax of sorts on them. So, how will they make up for this? By charging more for the houses they build: thus taxing people who can afford housing. That’s what I call “trickle down taxes”.

I emailed my mother this story and she responded with: “The Daily News is currently exposing the financial hoopla going on in the school district. Administrators have increased about 20% over the last 5 years while enrollment has decreased 6%. Over 51% of the employees earn over $100,000.- a year. Now Villagaroisa has taken over the school I think it will get even worse. And scores keep on dropping….. He thinks that anything that keeps him in the spotlight is great, he’s a political climber, probably got his eyes on GOVERNOR then PRESIDENT.”

Things are starting to look a lot like Atlas Shrugged


Blogger busybusyrayray said...

I have to say, I am not a fan of Villaragoisa. I agree with your mother, he is only political climber whose purpose is to make into the spotlight on a daily basis. And there is one thing that Los Angeles does not need right now is construction of new homes. What they should do is buy up the foreclosed homes that line the streets and the houses that developers have been unable to sell, and put those in a program. HOWEVER, I'm sure not sure where in the state you live or what houses are going for in your area, but here in L.A. $250,000 is a GREAT price for a house. My house is small, nothing special and not in the best area, but still valued at $475,000. Even with the current events that are going on today, houses in LA will NEVER be the good days of $150,000. Unless maybe we have another earthquake, which was the only thing that drove them down in the first place. But then I really don't need that to happen, and I don't want to rebuild a red tagged house with earthquake damage. LA is a very expensive place to live,so if there will be good houses in decent areas going for $250,000, that would be a great thing for the people of Los Angeles.

7:32 PM  
Blogger CaliValleyGirl said...

BusyRay: it is actually units, meaning some of the referred to homes are actually condos or apartments...some we are not talking a two car garage and a backyard. The article mentions the possibility of buildings taller than the current 6 storey limit...so yes, $250,000 is good for a house...but I think you can make apartments for much cheaper, expecially at that scale of production.

I think a better solution would be incentivizing the creation of new jobs in areas like Lancaster and Palmdale or places like that, instead of adding to the traffic problem in LA. Houses are already a lot cheaper there, as well.

7:58 PM  
Blogger Nicole said...

Housing is such a funny thing. It's amazing to compare what you can buy in one area of the country to what you can buy in another; then throw in property taxes and the comparison gets even trickier. We now pay $300 more a month for our house in Illinois that looks almost identical to our former house in AL...same square feet, same fixtures...but 9 times the property taxes...eesh.

10:57 PM  
Blogger Sarah said...

My "deployment husband", as AWTM calls him, hasn't read Atlas Shrugged yet. He has it packed to take on his upcoming deployment, and I keep getting frustrated with him and saying, "You NEED to read that book right now!" Because I totally agree, that's all I can think about these days.

5:14 PM  

Post a Comment

<< Home