Re:Small cities in America’s Mountain West are booming
by bsder on Tuesday April 20, 2021 @12:23AM
(#26870640)
> Housing cannot be both affordable and a good investment.
It certainly can be.
However, the combination of 0% Fed Interest Rate and low property tax rates kills the "affordable" side of that equation.
The 0% Fed Interest Rate means people can go way higher in mortgaging the hell out of themselves than if the rate was say 5%.
As for the property tax, raising the property tax rate limits the price of a home because even if someone could swing the down payment on a McMansion, the annual property tax payment would start biting into how good an investment it is. So, the developers would start building houses that assess at where the majority of buyers sit.
Of course, the same people who complain about getting gentrified also generally oppose raising property taxes even slightly. Oh well.
It certainly can be.
However, the combination of 0% Fed Interest Rate and low property tax rates kills the "affordable" side of that equation.
The 0% Fed Interest Rate means people can go way higher in mortgaging the hell out of themselves than if the rate was say 5%.
As for the property tax, raising the property tax rate limits the price of a home because even if someone could swing the down payment on a McMansion, the annual property tax payment would start biting into how good an investment it is. So, the developers would start building houses that assess at where the majority of buyers sit.
Of course, the same people who complain about getting gentrified also generally oppose raising property taxes even slightly. Oh well.