The housing bubble is on everyone's lips these days (more specifically, the imminent bursting thereof). So, it is not unnatural that the Washington Post today is running a story about a woman named Gwendolyn Halford who makes $60k p.a., but who hasn't been able to buy a home that meets her standards (2 bedrooms, 2 bathrooms, Parking and washer/dryer in the unit) at her price range -- and she has been looking for more than 5 years...
A few choice quotes: "You are allowing developers to come in to build condo units and homes at prices that a large percentage of the population can't afford," she said. "So what is going on here?"
It's called capitalism. Someone takes a risk to build something so that they can make money if it sells. If it doesn't sell, then they lose money. If you can't afford to buy it, that is not the developer's concern. Using your logic, should new buildings be built only if a large majority of the population can afford them? If so, how is the population measured? What about slum areas? Under this logic, once a neighborhood becomes poor, it will remain poor. You can build new homes for the poor residents at artificial prices, but those poor neighborhoods would remain more or less in their current state: with the same residents paying the same taxes to support the same infrastructure that clearly was not conducive to income generation in the first place.
People such as Halford say they are priced out of something that by rights should be theirs.
By rights? What right is this? The right to housing? The right to housing at a certain price? What is a housing right? The right to purchase or rent? Has someone denied her the ability to purchase or rent something? Does a housing right have an inflation element inherent in it? How would a housing right measured monetarily be calculated? Can rights be calculated? The author slips this opinion about rights into the story as if it comes from the ostensible human interest element, but by not explicitly countering that claim with an opposing opinion, tacitly allows it to be recorded as fact. This sentence is an example of disgraceful journalism.
Last year, nearly half of the $21 million in disbursements from Montgomery's Housing Initiative Fund went to buy and renovate apartment buildings that officials considered "threatened." In many cases, the threat came from an owner who intended to convert affordable apartments into luxury units.
Is this paragraph written positively (i.e. that it is a good and noble use of taxpayer dollars to fight gentrification)? Artificially limiting the use of a building by its owner in the name of a poorly defined social good is not a particularly useful means of either taxpayer dollars or governmental energy. At what point does an asset that you own become threatened? By whom, by the way? Who decides that a building is a threatened? This article treats the building as the property of the government (acting in the name of society) first, and the actual owner second.
Leggett [a MD politician] proposed that the county develop entire projects of price-controlled housing.
Great. Projects worked so well in the past, I don't know why they ever fell out of favour...
Looking past the tired brown carpet, the dated appliances, the "little bug" crawling in a kitchen drawer, she [Halford] saw some potential. But for $199,000, she said, "I would want it to be in better condition than that."
My immediate reaction to the article is that maybe the woman who is its subject will never be satisfied with what she can afford -- and that attitude makes her just like everyone else. If you look for something with 2 bedrooms, 2 baths, parking, a washer and dryer in a good neighborhood in the DC area for 200K and think that you will suddenly find it if you just wait (!), then maybe you are the problem and not the housing market.
And as for the broader housing market's problem of affordability and the relevant solutions to that problem, I do not find the article pursuasive. In both economic and social terms, most attempts to use a fuzzy notion of justice to shape the law are bound to end in painful, unintended consequences.
Shame on the Washington Post for such an overtly lefty political piece posing as a human interest story.
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1 comment:
There should be no "housing right", and thankfully there is none. Perhaps it will become the next amendment if Hillary gets the 2008 nod, but for now there is none.
That's not to say that government doesn't play a huge role in the housing market. One of the hottest markets is Portland, OR (my previous home town). Anti-sprawl rules pushed by state democrats prevented urban growth beyond certain boundaries. In a state that is only 2% developed, this seems a little overly cautious. As expected from any simple understanding of economics, prices began to soar and soar as land, abundant as it is there, became a precious commodity.
The woman in that article simply needs to realize the harsh truth....you don't have a right to own everything you want.
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