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  1. #1 Owning a house no longer part of the American dream? 
    Owning a house no longer part of the American dream?

    By Patrice Hill
    The Washington Times

    9:48 p.m., Tuesday, February 15, 2011

    As Congress and the White House debate how to patch up the housing market after four years of crisis, one clear lesson has emerged: Political leaders for the first time in decades no longer see the American dream of homeownership as the all-consuming goal it once was.

    Against a backdrop of burgeoning foreclosures leading to blighted neighborhoods and rising homelessness, the administration’s blueprint for housing finance points out what may seem obvious but is difficult for most politicians to acknowledge: The debts and responsibilities associated with homeownership are not for everyone, and many families are better off renting.

    That feature of the White House‘s plan for winding down mortgage giants Fannie Mae and Freddie Mac helped engender a surprisingly warm response from congressional Republicans, who are intent on minimizing the government’s role in housing, while it set off an unexpectedly sharp backlash from administration allies, such as liberal groups and advocates of lower-income Americans.

    Housing and Urban Development Secretary Shaun Donovan called it “rebalancing” the government’s long-standing preference for homeownership and said that steering people with low incomes and poor credit toward rental housing where appropriate should be the emphasis.

    The administration’s goal is no longer “for all Americans to become homeowners,” Mr. Donovan said, but rather to promote homeownership among those “who have the credit history and financial capacity” as well as desire to own a home.
    Housing and Urban Development Secretary Shaun Donovan says the administration's goal no longer is Housing and Urban Development Secretary Shaun Donovan says the administration’s goal no longer is “for all Americans to become homeowners,” but rather to promote the American dream only for those who can afford it. (Associated Press)

    That contrasts with efforts by Congress and presidents of both parties in past decades to promote homeownership seemingly at any cost. Congress has rarely hesitated to lavish subsidies and tax breaks on homeowners, starting with the extensive network of subsidies for mortgages provided by Fannie, Freddie and the Federal Housing Administration (FHA).

    Trillions more dollars are spent subsidizing homeownership — but not renting — through the tax code’s mortgage interest deduction for first and second homes, real estate tax deductions, deductions for mortgage insurance and, most recently, tax credits for first-time homeownership.

    Douglas M. Bibby, president of the National Multi Housing Council, applauded the administration‘s “return to a housing framework that understands that not every American wants to or should own a house.”
    Washington Times
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  2. #2  
    Senior Member Arroyo_Doble's Avatar
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    I have heard it argued that home ownership, especially with long term mortgages, is a detriment to the labor market and the larger economy because it seriously impedes the flexibility of labor.

    As far as the neighborhood level, I prefer owners on my block to renters.
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    Quote Originally Posted by Arroyo_Doble View Post
    I have heard it argued that home ownership, especially with long term mortgages, is a detriment to the labor market and the larger economy because it seriously impedes the flexibility of labor.

    As far as the neighborhood level, I prefer owners on my block to renters.
    I might have agreed in general until I moved to this neighborhood. Yes, the nicest houses in the four block area are owner occupied, but so are the worst houses in the four block area. I have a rental across the street and one next door. Both houses are well maintained by the owner and the tenants are good neighbors. Down the street is a house I call the Beverly Hillbillies; they have a lot of junk that is visible from the street, it took them two months to close in the front porch and then two years to stucco and paint it. They still have a ratty looking window AC unit installed with plywood framing in a front window. And yet, they have a yard service... go figure.

    It's also important to remember that every worst case scenario rental house is also a bad homeowner. The rental down the street from me has a long history of problems. The owner keeps renting the house to people who are a problem, so I have to conclude that either the landlord is incompetent, or he's simply more interested in how much rent he can get than the quality of the tenant.

    One of San Francisco's wealthiest and most notorious landlords, a German national actually, made his fortune and his reputation by being a bad landlord. He specialized in renting to drug dealers and prostitutes. While everyone else was running credit checks and trying to get responsible tenants, his business model was to charge substantially higher than market rents, but require no deposit or credit check.
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    Quote Originally Posted by Arroyo_Doble View Post
    I have heard it argued that home ownership, especially with long term mortgages, is a detriment to the labor market and the larger economy because it seriously impedes the flexibility of labor.
    Can you elaborate? Flexibility in terms of being able to move from job to job in different locations is what I'm assuming. I could be completely wrong, I've just not heard that argument.
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    Senior Member Arroyo_Doble's Avatar
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    Quote Originally Posted by ralph wiggum View Post
    Can you elaborate? Flexibility in terms of being able to move from job to job in different locations is what I'm assuming. I could be completely wrong, I've just not heard that argument.
    It has to do with regional ebbs and flows of economic growth; access to labor being an important factor. People locked into a community, economically more than culturally, makes the labor force more static creating artificial scarcity during growth and a drag during recession (again, regional).

    It has been awhile since I read the article. For all I know, it was not an article but something on NPR.
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    Quote Originally Posted by Novaheart View Post
    I might have agreed in general until I moved to this neighborhood. Yes, the nicest houses in the four block area are owner occupied, but so are the worst houses in the four block area. I have a rental across the street and one next door. Both houses are well maintained by the owner and the tenants are good neighbors. Down the street is a house I call the Beverly Hillbillies; they have a lot of junk that is visible from the street, it took them two months to close in the front porch and then two years to stucco and paint it. They still have a ratty looking window AC unit installed with plywood framing in a front window. And yet, they have a yard service... go figure.

    It's also important to remember that every worst case scenario rental house is also a bad homeowner. The rental down the street from me has a long history of problems. The owner keeps renting the house to people who are a problem, so I have to conclude that either the landlord is incompetent, or he's simply more interested in how much rent he can get than the quality of the tenant.

    One of San Francisco's wealthiest and most notorious landlords, a German national actually, made his fortune and his reputation by being a bad landlord. He specialized in renting to drug dealers and prostitutes. While everyone else was running credit checks and trying to get responsible tenants, his business model was to charge substantially higher than market rents, but require no deposit or credit check.
    I was thinking more of being involved in the cultural and political community than Jed Clampetting the place up.
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    Festivus Moderator ralph wiggum's Avatar
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    Quote Originally Posted by Arroyo_Doble View Post
    It has to do with regional ebbs and flows of economic growth; access to labor being an important factor. People locked into a community, economically more than culturally, makes the labor force more static creating artificial scarcity during growth and a drag during recession (again, regional).

    It has been awhile since I read the article. For all I know, it was not an article but something on NPR.
    Thanks. I vaguely recall reading something along those lines in an Economics textbook eons ago.
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    Those that rec. the $8k tax credit for a home in 2008 will get an unwelcome surprise from the IRS. That money was a loan and has to be paid back. Those that purchased their house in 2009 & 2010 will not have to pay it back. No wonder the housing market is so screwed up with laws like these.

    Owning a house is still part of the American dream. Having good credit with a down payment will get you there. So many people want things like a house, car, boat, big TV without the means to pay for it. My parents saved up to buy things and the only thing they ever financed was a house.
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    It's still my dream. I want a 1600+ft house, two car garage, 10+ acres of land.

    Unless the deal of the century falls into my lap, it won't be something I move on for another decade at least, but it is still a part of my dream.
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    Quote Originally Posted by djones520 View Post
    It's still my dream. I want a 1600+ft house, two car garage, 10+ acres of land.

    Unless the deal of the century falls into my lap, it won't be something I move on for another decade at least, but it is still a part of my dream.
    I want an 800 SF house on 400 acres with a 4 car carport.

    And :

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