Thursday, June 2, 2011
SAN DIEGO The dream of owning a home is shared by lots of Americans, and home ownership has its upside. You don’t have to badger a landlord to get stuff done. It brings stability to neighborhoods and encourages housing upkeep. But does it still make financial sense? Maybe. Maybe not.
A story in Slate takes the position that renting is better. This is the kind of view that’s been encouraged by the depressed housing market. The Slate article cites studies that show the financial return you get on your home investment isn’t as good as you think when you consider down payment, closing costs, depreciation, maintenance and property taxes.
Let’s just remember that a lot of the same costs that homeowners complain about are passed on to renters by the landlord.
I remember chatting with a guy at a party a few years ago who argued that a disciplined investor can make out better renting than buying. But the key is that you have to be disciplined.
What’s the beauty of owning a home? Every time you make a mortgage payment, which you have to do, you’re investing in a property that will give you financial return. It’s forced savings. Is there any other vehicle for that?
What Has Prop 13 Done for Us Lately?
LA Times columnist Steve Lopez probably never did like Proposition 13. But now he claims there’s all the more reason to get rid of it. That’s because the people who benefit from it are getting fewer and fewer.
Prop 13 was passed in the late 1970s to protect people who really were afraid that increasing home prices in California were going to tax them out of the house. But given the recent bust of the housing market, who needs protection? Lopez makes the point that anyone who’s bought a house since 2002 hasn’t gained anything from Prop 13.
That means the people who do benefit are getting old and few. And declining birth rates (in LA County at least) mean there will be fewer people available to buy the homes all those elders are going to want to sell.
Maybe demographics and home prices will conspire to create a political scene where Prop 13 will actually go away, or at least be reformed.
Do You Really Need to Park at the Park?
Here’s a quiz. How many parking spaces are there in Central Park in New York? The answer is 130. And the place gets 25 million visits every year!
Take a look at this story from Streetsblog.net about the whole business of parking at the park. This is a discussion we’re now having in San Diego as we consider the possibility of building a parking garage in Balboa Park.
San Diego is much more car-centric than New York. The Streetsblog piece argues that if you absolutely need parking spaces, make people pay to park. Minneapolis (my old home town) started doing that and found a guaranteed source of revenue to keep the parks spruced up
Try that in San Diego and you’ll hear loud protests. Leave a comment below if you have a view on what's the best way to go.