Comments on: Treasury Officials Concerned over Option ARM Recasts and Jumbo Loans Issues – Recalibrating the Housing Numbers while 5.6 Million Mortgages are Delinquent. California One Two Housing Punch. 60 Percent of Option ARMs and 45 Percent of Jumbo Loans in California.

By: Tom Perkins

Tom Perkins — Sun, 28 Feb 2010 14:19:35 +0000

“The tax write-off for mortgage interest makes homes more affordable. Simple law of supply and demand — home prices go up to compensate.”

And supply goes up, attracted to the higher prices, and prices come back down. That adjustment has long been made, and it has nothing to do with the housing bubble. It is also no transfer of money to banks–since its money the government doesn’t tax in the first place. It is a subsidy of the mortgage taker, and who pays for it is everyone who pays any other tax, fee, or tarriff to the feds–including even people with mortgages, whose other tax rates go up marginally to partially compensate for the income tax they aren’t paying on the income that goes to their mortgage interest.

And for that it is a subsidy, it is not one that should be ended abruptly, instead, it should be wound down gradually, such that 97% of mortgage interest is deductible on mortgages taken out next year, 94% after that, and 91% after that, and so on.

As the uncertainty caused by Obama shows, changing the rules of the game out from under people is usually more damaging than it’s worth.

By: bill

bill — Sat, 27 Feb 2010 18:07:20 +0000

bank holiday..perhaps……july -august…2010…arch crawford…..hard to argue with the # 1 economic newsletter writer….return wise that is…

By: Laura Louzader

Laura Louzader — Thu, 25 Feb 2010 20:26:35 +0000

Chicago property taxes have gone from being reasonable to downright confiscatory.
A house worth $500K will pay about $15K in property taxes, and the cheaper the property is, the worse the tax hit will be. I am looking at condos priced from $65K to $150K on the far north side of the city, and the taxes range from $3000 to $5000 a year.
Worse, homeowners in the poorest south side neighborhoods like Englewood, Cottage Grove, and Gage Park are being bludgeoned to death on property taxes, to the point where I honestly feel they have grounds for claiming discrimination. Little shanties that would barely fetch $35K in today’s market are getting tax bills for $4000-$5000…. almost as much as $800K condos in downtown Chicago. Well, they can let their little houses go and see if they can get one of the subsidized “affordable” apartments that cost the taxpayers $447,000 per unit to build, if you can believe.
Crook County politicians have turned this area into Tax Hell. Chicago also has the highest sales tax in the nation, 10.5%, which is driving consumers away from city businesses.
We have become so crazy and corrupt here.

By: Laura Louzader

Laura Louzader — Thu, 25 Feb 2010 20:06:23 +0000

How can men be the “gatekeepers” on irrational spending when they’re just as irrational themselves. Don’t try to palm off your bad housebuying decisions on your wives, guys

For, while women love nice things and crave attractive surroundings, males CRAVE public admiration and place among their male peer groups. The male must show he is successful, and even cars don’t do that-anybody can lease an expensive car. Only an expensive house will do that, and the guy gets extra prestige points for having a high-maintenance “trophy” wife.

By: Bob Griswold

Bob Griswold — Thu, 25 Feb 2010 19:45:36 +0000

Can some of you people outside of Calif. tell me what your annual property taxes are?
Curious how this state compares.