VC: IHDA MRB OK

Don’t interfere with my free market. Don’t bring those people into my village. We don’t want trash living in homes they can’t keep up. Don’t tell me who I can and can’t sell to. Keep the government out of the real estate market. Yada yada yada. Blah blu blah blah blah. When it comes to housing, there’s no shortage of people lining up to tell other people what they can’t do. You can’t do this; don’t you dare think about doing that.

Last March during the election I placidly took a bunch of specious crap from real estate investors and flippers who were aghast I thought maintaining middle class housing in DG had value. They didn’t bother to stick around to actually find out what I supported and why I supported it, they just passed a fast and breezy judgment that I was for bringing those people into DG and moving them in next door to every god fearing tax paying resident of the village.

The housing market changed. It cratered. No fast lane to riches for flippers anymore. The real estate people who are toughing it out are smarter and more open minded. In 2007, when one of those people (the flippers and real estate investors) bothered to talk to me they found out the needs had changed, and that DG should do something to help find buyers for the too-many homes on the market. Too many middle class homes on the market. Yeah, some of them are only worth tearing down, but not all of them, and those are the ones that need buyers who will live there and raise families and pay taxes and be your neighbors and new friends. They are not investors looking for a house to tear down, build a mega mansion, and raise your taxes through the roof just because you live nearby. Or owners sitting on a marginal property waiting for the market to come back in 1-4 years by renting out to the very kind of people you don’t want owning a house next to you.

Even as they tried to argue I was wrong, those Ad Hoc members who voted there was not a housing shortage in DG ended up supporting my contention that right now there are too many homes, and not enough buyers. Why? Because it’s an undeniable fact.

So last week council looked at a modest IHDA cap request, a request for authority no one else was asking for. Not flippers, not real estate investors, just IHDA, looking to use the bond cap to maybe put 5-6 families into middle class homes they could afford. And this week they will vote on it.

I urge council to vote yes and to waive any fees, and just see if it works at all. A test to see if it is worth it.

DG is not involved past granting them the authority. IHDA uses the cap authority to sell bonds to investors. They are Fed tax exempt, which yields a higher return-are you listening real estate investors?

Note to free market supporters; read this please, then back track and learn all about IHDA. I know this talk here about low-income housing and such is going to raise your hackles, but it is the middle income housing here that IHDA would be dealing with, and it is exactly the kind of economic program I talked about to you and others on both sides of the housing issue: find some buyers for some of our mid priced, nice single family homes. Do not tell me these are not prime for the right starter family: nice neighborhoods, our tax rates are sane relative to our neighbors, and our schools remain a village strong suit.

This is not about interfering with a free market, or letting those people into DG. This is different. This is about using DG authority to provide economic aid to DG. Last year it was helping a manufacturer out in Ellsworth get bigger, and more tied into DG so they stay here. This year it is about maybe selling 5 or 6 of the saleable $300K or so single family homes that are nice, are ready to go, and have been on the market for a while.

As the bond issuers, IHDA; with a track record of returning about a 5% profit to the state, they do okay by taxpayers. They will not put a family into a home they can’t prosper with, so relax everyone, the white trash are not packing their bags to move here. If they can’t afford here, they won’t be here.

This should be a back-stop program every year. In case we have leftover (which I would hope not), it goes to IHDA for a DG program.

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2 Responses to “VC: IHDA MRB OK”

  1. Marge Says:

    Your right, 1.3 million ain’t what it used to be.

    I know Greg Bedalov over at the EDC has tried like heck to find another taker for this bond cap, but alas, could find none. Often even the whole 4+ million bond cap only covers a portion of the money a business needs to complete a planned development or expansion (as was the case in 2007.) If a business has a good relationship with a bank or lender it can make more fiscal sense for them to borrow the whole sum from a single source, rather than to break up a loan into the bond cap and a secondary source for the balance.

    So what do you do when it looks like your bond cap is gonna sit around and mildew? Why waste it? Why not try and make it work for you, even if it’s a less than ideal program? I agree that we should give the money to IHDA and see what they can do to get it to work in DG. I know some people may be shocked that I feel this way. But, let’s be practical, if IHDA can’t put it to use in DG in the next few years, we can honestly say “No, you have had your chance and it hasn’t worked out for us” the next time they ask.

  2. markthoman Says:

    That makes sense to me. Practical is a process we will need moving forward on many issues.


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