March 22, 2016
Tuesday’s Regulatory & Legislative Roundup
- New ordinance in Minneapolis, MN requires landlords to handout voter registration forms to new tenants in hopes that such a requirement will ensure that the local election administrators have accurate voter information.
- The Federal Reserve announced that even though inflation picked up, it is not over the Fed’s two percent objective, and thus, the current interest rate for bank lending will remain at 0.25 percent and 0.5 percent.
March 22, 2016 | Permalink | No Comments
Monday’s Adjudication Roundup
- The Sixth Circuit affirmed the dismissal of a False Claims Act suit against US Bank for allegedly trying to prevent home foreclosures by ignoring a commitment, costing the government $2.3 billion in insurance payments.
- Apartment owner loses in $14 million suit against Dish Network and DireTV because it failed to prove that the companies were responsible for the damages to the roof and walls in the apartment complex.
March 21, 2016 | Permalink | No Comments
Friday’s Government Reports Roundup
- The S. Government Accountability Office (GAO) released a report on the Troubled Asset Relief Program (TARP) making two recommendations to the Treasury: (1) the Treasury should estimate future expenditures for the Making Home Affordable program, and (2) it should deobligate funds that will likely not be expended and move up to $2 billion of such funds to the TARP-funded Hardest Hit Fund.
March 18, 2016 | Permalink | No Comments
March 17, 2016
High and Low Property Taxes
Newsmax quoted me in Lowest Property Tax Is Hawaii and the Highest Is New Jersey. It reads, in part,
The average American household spends $2,089 on real estate property taxes each year and residents of the 27 states with vehicle property taxes shell out another $423, according to the National Tax Lien Association.
However, some states cost more than others when it comes to the American Dream and its staples of a house and car.
“Different parts of the country have different levels of taxation and amenities paid for by the tax receipts,” said David Reiss, professor of law and research director with the Center for Urban Business Entrepreneurship at Brooklyn Law School.
The state with the lowest real estate property taxes is Hawaii where residents pay only $482 per household, which is the least average amount typically shelled out by a taxpayer, according to a 2016 WalletHub study, ranking states with the highest and lowest property taxes.
“High property taxes tend to be correlated with high income and high income tends to be correlated with Blue States, so it is not surprising that high property taxes are correlated with Blue States,” Reiss said.
* * *
“Local property taxes can help pay for all sorts of municipal services, including schools, road maintenance and emergency services,” Reiss said.
Alabama, Louisiana and Delaware, D.C. and South Carolina follow Hawaii among the states with the lowest property taxes.
High tax localities, such as Westchester County in New York, could have annual taxes that easily are in the tens of thousands of dollars a year range but such areas also have some of the best schools in the nation.
The WalletHub report further found that in Blue states, real estate property taxes are 39% higher at $2,250 a year than homeowners in Red states who pay $1,613.
The yearly burden weighs far more heavily on taxpayers in some states than in others based on region.
For example, communities in the Northeast typically have higher property taxes than many of those in the rest of the country.
“Monthly mortgage payments are usually much higher than monthly real property tax payments, measuring in the high hundreds in low-cost metros like Pittsburgh to the thousands in a high-cost metro like San Francisco so it is hard to put default rates squarely on the shoulders of real property taxes,” said Reiss.
March 17, 2016 | Permalink | No Comments
Thursday’s Advocacy & Think Tank Roundup
- The National Low-Income Housing Coalition released state-by-state estimates of funds allocated by the National Housing Trust Fund.
- A new study published in Sociological Studies found that in major cities like New York, Chicago, Los Angeles and Houston, 35 percent of all neighborhoods will eventually re-segregate in the next 20 years.
- The Economic Policy Institute released a report on wage inequality, finding that it has continued in its 35-year rise last year.
March 17, 2016 | Permalink | No Comments
March 18, 2016
Fannie & Freddie’s Duty to Serve
By David Reiss
The Federal Housing Finance Agency had issued a request for comments on a proposed rulemaking back in December about Enterprise Duty to Serve Underserved Markets. Comments were due yesterday. I drafted a short comment letter on one of the many topics raised by the rulemaking. The abstract reads,
The FHFA has requested input on its proposed rule that would provide a Duty to Serve credit to Fannie Mae and Freddie Mac (The Enterprises) for eligible activities that facilitate a secondary mortgage market for mortgages related to preserving the affordability of housing for homebuyers, among other things. I write to comment regarding the preservation of affordable homeownership through shared equity homeownership programs.
The Proposed Rule requires that each Objective of an Underserved Markets Plan be measurable in order to determine whether it has been achieved by the Enterprise. The Proposed Rule requires that these programs “promote successful homeownership.” § 1282.34(d)(4)(iii). While the Proposed Rule addresses ways that ensure that housing remains affordable for future owners after resale, it does not offer a way to measure successful or sustainable homeownership for participants while they are in a shared equity program.
The FHFA should require that the Enterprises measure the tenure of homeowners participating in shared equity programs and disallow Duty to Serve credit if participants fail to maintain their housing for reasonable length of time. While this comment is being made in the context of shared equity programs, it applies with equal force to all homeownership programs that are counted for Duty to Serve purposes.
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March 18, 2016 | Permalink | No Comments