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Friday, October 8, 2010
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36 comments:
Kinda crazy - 891 DOM: FSBO in FC
Comments from yesterday:
dc2, you really sound like a "hate the rich" person...
"It appears the wealthier people get, the more they want to hold to everything they have and the more stingy they are to even pay for what they should."
You came up with this because of some random article about wealthy people wanting certain services from banks and not wanting to pay for them? Absurd.
"There are a lot of people who work very hard all their lives but are not able to buy a home in their lifetime and die in abosulte poverty. Do you understand this now? Where is your moral compass?"
True, but you fail to understand that many rich people also work very hard all of their lives. Not sure who you are referring to with the "moral compass" comment. You have no idea what anyone on this board does for charities or other less fortunate individuals.
You seem to think that the wealthy need to give more to help everyone else. What exactly should they do? Donate to charities? Done. Pay taxes? Done. Employ millions of Americans? Done.
There are lots of interesting goodies on housing by CDs in this blog post from Zillow: What Impact Will the Housing Market Have on Congressional Elections?.
Novahog,
By many standards I consider myself wealthy. I do not hate myself. That is ridiculous. I do count myself blessed. I have worked hard but I also recognize that many opportunities that opened in life happen by pure chance. I was lucky enough to have parents that instille an education in me, and yes I was blessed with above average IQ. So I had the right foundation to build on.
Some people complain that wealthy people pay in taxes more than the rest of the population. However, that just makes mathematical sense. I do not complain that I pay more taxes than people who earn less than me.
I never heard of a very wealthy person who all of a sudden dropped from being in the top 1 percent richest in the U.S. because they paid higher taxes. They pay taxes and they remain very, very wealthy. So stop all the whining and crap about very wealth people paying more taxes.
Keep in mind that higher taxes are for income above a certain high treshold. Income below that is taxed at a lower rate.
When 1 percent of the U.S. population benefitted for the previous 15 years by earning 50 percent (yes, 50 percent you heard right) of the economic output, it stands to reason that they will owe a lot more in taxes. But they also kept a lot more of that wealth than anyone else.
I find extremely funny that most people who are against taxing the rich to what is fair and reasonable happened not to be the wealthy. They do because they envision themselves there. I hate to break it to you, but only the few get there. The few make for great, interesting stories of how they got there. These stories are inspiring (when not built on scam) and I applaud and congratulate their efforts. We need individuals who can create large firms which can employ lots of people. I admire that.
What I am talking about, is that those very people who made it (being by building and empire from scratch, beneffiting for day trading and all the advantages very wealth people or financial institutions have, etc, etc.), should feel very blessed and should pay higher taxes so we can level the playing field for everyone.
Again, only less than a third gets a college education in the U.S. Do you understand how incredibly detrimental this is to our society? Our nation fails to benefit from the contributions of so many who did not get an education, and as such loses its competitiveness in the world. We are already down that path.
dc2,
You are conflating two issues.
Regardless of how much money you make or how much tax you pay or do not pay, you do not have the right to own a house.
You have the right to TRY to own a house, by working hard and saving, by applying for loans, by whatever legal means you can.
But the truth is that some people will never get it together to buy a house, because they don't earn enough money at their job, because they are not fiscally prudent with the money they do have, because they ruin their credit through too many trips to Best buy, because something desperate happens in their life (e.g. debilitating accident, long-term illness of family member).
Nothing would make me happier than to see everyone installed in a home of their own that they can afford, in an area with good schools and a short commute.
Also, I would like a pony.
All that has nothing to do with the income gap -- which I agree is scandalous and something we should be ashamed of.
But, you make your capitalist bed, you have to lie in it.
dc2-
I think my issue with your comments is the assumption that the government uses its money in a productive fashion. We have spent over a trillion in Iraq and many trillions on health care to have worse care than most developed nations. I would much rather pay fewer taxes and have more money to donate to charity.
In addition I think people in the US do have a pretty fair chance to work hard and make a better life for themselves. This is not true and many/most parts of the world. Why should I be taxed 50k to help someone in the US keep a house they can't afford when that same 50k could be used to deliver water to a village in Africa for years. It appears you think people like Bill Gates should have paid dramatically more taxes to help the poor in the US. I on the other hand am very glad he paid very little in taxes, because he is much more efficient at donating his wealth to help the world.
Sure I feel bad for people who bought their first house in 04-07 if they are underwater. This however, is not that many people. Most people who are underwater are in that position because they either used HELOCs or moved to a larger house during the boom. So sure it would have been great if they were paying off their house so they could retire, but this just isn't what was happening in most people cases. Should I pay for someone to stay in a house, because they wanted to use their house as a ATM machine?
nova-
In 2008 they were doing a good job of lowering the price. I assume if they continued it would have sold. During the last two years they have moved the price a lot of times, but haven't changed the price very much. Up a few grand down a few grand...
LJJ and HB,
Don't forget that the comment that sparked this whole debate was a local government program meant to help people stay in their home if they fell upon hard times. They had to be in the home a certain amount of time, prove that they were capable of staying in the home minus the hardship, and likely had a finite amount of aid. Additionally, if memory serves, the program had been in place nearly 30 years.
Confusing the issue goes both ways since you are basically saying that only deadbeats qualify for this program. Further, you are characterizing it as if it is an unlimited handout. It seems the program does it's due diligence with entrance criteria to make sure that those people that can be helped, are helped.
My $0.02
mytwocents-
I was not targeting my comments to any specific program. Rather I was talking more about all of the programs combined. I also was not calling people deadbeats. I was saying I think there are more useful places to spend money. I was also saying that in general people who did not pull money out of their house or buy a bigger house should still be above water.
I think it is perfectly fine too pull money out of your house to pay for vacation, kids college... but I don't think you need support if you later fall on a hardship. Yes I do think it is really unfortunate there were a lot of first time buyers in 2004-2007. I am much more sympathetic for these people than people who have owned a house for 10+ years and still have no equity.
HB,
It's clear they have no real need to sell. Bought in 1991 for $145K. It must be one of those "make me move" listings. If someone is willing to pay my price, i'll move. It's assessed at a little over $300K. Sounds about right since there are brand new 2br condos listed at the Spectrum for around $400K. A new 2br/2ba recently sold there for $362K.
dc2 said: "I find extremely funny that most people who are against taxing the rich to what is fair and reasonable happened not to be the wealthy. They do because they envision themselves there."
You don't think the rich already pay their fair share. What would be fair to you?
You keep going back to people not getting a college education. Again, what do you propose?
LJJ is correct, people do not have a right to buy a house, they have the right buy what they can afford. There are plenty of places i would love to own, but can't afford them.
Novahog,
Obama is proposing letting expire the very untimely tax cuts for those who make in AGI $250K or more. That is a fair proposal. He could maybe let it go for two additional years as some have proposed, but after that they need to expire. This does not mean people will be poor the next day. They were already paying the tax before Bush passed the tax cut.
Many wealthy people like Bill Gates and Warren Buffet agree they are not paying their fair share in taxes, because taxes are too low. So, yes I find funny that those who are not wealthy want to protect the extraordinary wealth of people like Gates and Buffet, and countless other.
I do go back to education because of its upmost importance to lift people from poverty. There should be accessible, low cost and quality college education for everyone. Costs of colleges and universities have skyrocketed since I went to college. That trend cannot continue because less and less people will be able to afford that education. Already only 27 percent of the U.S. population gets a college education. I find this absolutely shocking. But maybe you find it al'right.
So yes, taxes can be put in good use to ensure college education is affordable to everyone.
dc2-
This really shows the importance of a college degree unemployment by education
Those with college degrees only have a 4% unemployment rate.
Also I am fine and fully expect Bush's tax cuts to expire for people making over 250K, but this will have almost no impact on Buffet's taxes. Although he has billions of dollars he never sells anything so he pays very little tax. In addition everything is long term gains so his tax rate is currently 15% and will only rise to 20% when they expire. When Buffet says he should be paying more taxes, I think he is talking about reworking the entire system
dc2,
I have no idea how much Bill Gates pays in taxes, but i'm sure it's a ton. He is free to write a check to the IRS for as much as he wants if he thinks he's not paying enough. Personally, i think he's probably putting that money to much better use than the government ever will. The tax code is a complete joke...there's no reason for it to be as complicated as it is. For it to be fair, everyone would pay the same % of their income and all deductions/breaks would have to be eliminated. That will never happen.
A college degree is not a guarantee that you will be successful enough to purchase a home. It does increase your odds, but that's about it. Not to mention, college is not right for everyone. Also, i'm pretty sure there are tons of federal and state grants already available to lower income individuals.
Yes, everyone has the right to purchase a home if they can afford it. They do not have the right to purchase/keep a house at the expense of others.
dc2,
Are you familiar with NOVA? Did you know that everyone who graduates is guaranteed admission to a 4yr state school? Ever hear of night school? Not a walk in the park - I should know.
btw, I saw something (yesterday? on CNBC or CNN or FOX) that showed families making 40K to 50K will pay an additional $100-250 per month if the Bush cuts expire.
If you are so interested in further education, what are you doing to achieve this goal? I have friends that could not go to college. Their kids are first generation college grads. I put a niece thru college and donate to my school for needs-based scholarships. I pay full-boat for my kid, which I believe exceeds actual cost and provides aid to those who need it.
It seems that you want to contribute. Perhaps a lesser house would free up some money to help.
I think that you are conflating two issues. The first is: should the taxes be higher? And the second: should everyone have a shot at XXX?
With regard to the first, my personal feeling is not that taxes here are too low, but that Americans get very little for the taxes they do pay. We have to pay for healthcare, for education and other things that in most civilized societies are heavily subsidized if not completely free. That is because the state and its populace recognizes that it serves the public good to provide these services gratis. I would gladly pay more in taxes if it meant freedom from hospital bills, college IRAs, lack of maternity leave, daycare costs and student loans. This is my personal opinion - your mileage will vary. What I find curious in the U.S. is a near-total and culturally ingrained public support for absence of government-provided services taken largely for granted most everywhere else. But that's an entirely different subject.
Should everyone have a shot at college and home ownership? With regard to college, no one should be barred from college for financial reasons, but I support maintaining an IQ bar on college admissions. When you hand out college degrees regardless of merit, you devalue education. There is nothing wrong with not being college material, and blue-collar workers should not feel inferior because they are not suited to white-collar work.
My friend is married to a French guy who works for the World Bank. Masses of money, house in Bethesda completely paid off. They have one child, who has always been told that he will go to college in France, not here - because it is free to him as a French citizen and his parents are opposed, on philosophical grounds, to paying for college, even though they could afford to send the whole neighborhood to Harvard, if they wished.
Home ownership? I'd like to tell you a story. In 2006 I bought a condo in DC (on which I am now underwater but paying very easily) after working three jobs for a few years. My banker suggested using HPAP for downpayment assistance and ACORN for below-market rate. I went through both, which required jumping through a few hoops, attending a couple of seminars and checking some boxes. I got both.
You know what shocked me? How FEW people were there, taking advantage of essentially free money being handed out. I could off the top of my head name 20 friends who made below the maximum income cut-off and moaned about wanting to own a home. Why weren't they there? You know what will shock you? I was a legal guest worker (H1B). No green card, no passport. Nobody asked. The bank didn't care. If these programs were available to legal guest workers, why weren't more homegrown folks there applying for them? Why? Lack of money? Or lack of motivation?
P.S. Also got through grad school here on full scholarship. Available to all and sundry. All you have to do is apply.
Here is a nice, relatively new 5bdrm/3bath SFH in N. Arlington for $619k. The tax assessment is $731k.
Looks like a former forclosure home.
I wonder what's wrong with it?
Jewel, maybe this has something to do with it: BOA's Big Freeze
"There are concerns/challenges being raised about all foreclosures."
"It will also mean a huge wrench in the system of clearing out foreclosed properties and selling them out in the market."
Many might be avoiding foreclosures now fearing that they'll be in the middle of some crazy legal challenge?
If demand for foreclosures drop, then prices drop, potentially bringing everything else down with it.
Jewel-
The house looks like it is in really good condition. Someone in hear should check it out, it sounds like a great deal for those who want to live in that area.
I think it is currently a foreclosure. Why do you think it is a former foreclosure?
nova-
That is definitely possible, although the house is already a REO, so the foreclosure process has already been completed. Although there is a good chance you are correct people are afraid. Either way I still think it looks like a good deal and one of the people looking to buy in Arlington should go look at it.
nova,
If the major title companies start to refuse to insure these properties - game over. Perhaps it will drive purchaser's to "normal" sales. Who knows?
VA. is a non-judicial state, although I understand that some lenders have halted all foreclosures.
I am curious where they came up with their price target overpriced house
I also find it funny they call the housing smashing remodeled house. TO me it doesn't look like much if anything is new
HB, I agree. That is one underwhelming house.
I also find the HGTV-inspired air mattress staging amusing (you can hear the stager saying, "no one will ever know!"). One is fine, especially if you can find something to suggest a headboard, but one in every bedroom? I'd rather look at an empty house.
Hey MM, did you see Jewel's house in Illinois? I remember when that house was on the market previously and was surprised it didn't sell. I wonder if there is a weird neighbor problem.
"on Illinois", not "in Illinois"--sorry.
NN,
Have you been paying attention to the news at all? Many European nations have been having major protests with a lot of country-wide shut-downs because their governments are trying to cut back on public services. Why? They are not sustainable. France, Greece, Spain and Belgium have had huge protests over the last week or so over these issues. That university education in France may not be "free" for much longer.
VA Investor,
Bush tax cuts were implemented for all income levels. Obama wants to let expire tax cuts for those that make $250K or more in AGI. So your "fear tactic" about those who make 40k would have to pay more taxes if Bush taxes expire is irrelevant.
No. I am not familiar with the four-year guarantee to college, free or very low cost tuition NOVA offers. This is the first time I hear about it. Would love to know more. Then again, if true what about the rest of the country.
One person can not solve the education problem this nation faces. We need the collective mass of people to solve this problem, particularly those who have more. I pay taxes for public education I will never use, or anyone else will use. I will be happy to pay more in taxes to ensure college education is affordable.
I am happy that you can afford college for your kid and your niece. Great. Many others do not have that option.
VA investor you should sell all your properties and donate all the proceeds for education, since that seems for you to be the best option to solve this problem.
Study: Expiration of Bush Tax Cuts will hit Poorer Hardest.
If there's a refutation out there for the above, I'm all ears.
Congress fled without voting on the tax issue. One *hopes* they indeed will do as you say, DC2, but they didn't yet.
I have a sinking feeling that the extra taxes are going to feed the debt monster. That won't help the poor much.
But then again, I've had a sinking feeling for about two years now.
Hayfield Grad,
Yes, I have been watching the news and protests are a fact. The reason behind them is an opinion. Are services being shut down because they are not sustainable or because public funds required for their sustenance have been foolishly spent elsewhere? Have the governments run massive holes in their coffers they are now trying to plug with already-earmarked funds? It's never a question of sustainability but only of spending priorities.
contrarian,
Is it driving you crazy that the stock market keeps going up and the economy hasn't fallen into a deep depression?
I'm also curious to see if you still stand by your prediction of massive deflation? Have you seen the price of oil? commodities? gold?
Did you know that we're up to 363 failed bank since 2007 (http://bankimplode.com/), with 129 just this year? How many more banks have to fail for your dire predictions to come true?
David slightly over 50% of all foreclosures are in abeyance, is that even predictable?
is that priced into bank stocks?
"It's never a question of sustainability but only of spending priorities."
I hate to jump in late, but this is simply not true.
The problem in many of these states is that the electorate has convinced itself that they can vote for themselves whatever benefit they want.
"Hey, free ___ would be nice, lets have that!"
Implicit in this thinking is that money isn't really limited and that it is just a question of finding effective ways to get at it...
What they are finding in the current recession is that funds ARE limited and both taxes and borrowing are already as high as their economy can bear.
I live and travel extensively in Europe. I don't subscribe to any of the boogeyman theories that a state health care system or state funded education would be a disaster. I have seen it here and it does work, and in many ways is vastly superior to what the US has.
I have also seen that this approach does not erase the problem of scarce resources. Not everyone in Europe goes to college for instance.(and certainly not a top university) The overall availability of resources, from the number of MRI machines, to the number of students good universities can accommodate, right on down to the quality of roads and mass transit is ultimately limited by the population's productivity. This is finite and thus decisions about allocation must be made, rationing. (The connotation of the word is negative, but that is what we are talking about.)
Different states ration these resources in different ways, but they are all forced to ration them in one way or another. The only way to increase the overall wealth and productivity of the society, and thus its ability to provide scare resources for its population in the first place, is to increase its productivity, or strike oil... (go Norway!)
...and that is where the big problems come in. The greater a share of the available capital the state appropriates to reallocate at the national level, the less remains for the generally much more productive world of private enterprise to make use of. I am not simply talking about the Bill Gateses of the world. I am talking about the chaotic, but hugely productive world of millions of small scale enterprises ranging from people like VA_Investor, on up to a bio-technology start-up... they are all allocating the capital they have in the most effective way they can think to, collectively far more effectively than the state could, and in a world of sky-high taxes they would have less to allocate.
I am not arguing for one extreme or the other. Taxes are necessary, and I believe the state does have a role in creating opportunities for those who otherwise would have little, but on the other hand it is important to remember not to kill the goose that lays the golden egg.
housebuyer,
RE: house on Illinois street
I thought it was a "former" foreclosure house because it was sold on June 29th at a foreclosure auction.
"David said...
contrarian,
Is it driving you crazy that the stock market keeps going up and the economy hasn't fallen into a deep depression?
I'm also curious to see if you still stand by your prediction of massive deflation? Have you seen the price of oil? commodities? gold?"
David -- dont ever expect Contrarian to change his views. Like all permabears, his predictions are never "wrong", just "early" (i.e. it just hasnt happened yet).
Recall in Sept 2009 when he said I was naive to think the stock market wouldnt smash below its March 2009 levels by Sept 2010. When Sept 2010 rolled around and that didnt happen, (aside from his usual defense of deleting the comment and then denying he said it), he simply switched and said that april 2010 was the new peak and its all downhill from there.
Likewise, if the market breaks the April 2010 peak, he will simply delete that prediction, deny it was said, and make a new one, which will again be built around a end game of a cataclysmic deflation.
Its kind of sad really. As CRT once noted, as the years tick by and the rest of us buy houses, leave this blog, and go live the rest of our lives, he will still be here angrily calling all of us knifecatchers and insisting that doom is just around the corner.
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