Brown calls for 10 percent set-aside
January 25, 2007
BY FRAN SPIELMAN City Hall Reporter One-upping Mayor Daley in the quest to solve Chicago's housing crisis, mayoral challenger Dorothy Brown on Wednesday proposed a 10 percent affordable housing set-aside on all projects -- public and private.
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Daley favors private sector incentives and affordable housing mandates, only on city-subsidized projects. He remains adamantly opposed to mandatory set-asides on all private sector projects because of the impact lower-cost units could have on the city's property tax base and the chilling effect such a mandate could have on development.
"Developers need Chicago," Brown said at a news conference Wednesday. "This is a booming market. . . . We will not drive developers out of the city." Brown said her plan would offer developers fee waivers, density bonuses and fast-track approval of permits to minimize the financial risk.
Ms. Brown is not paying attention to the City. Chicago RE is dead in the water. Ms. Brown is not much of a business person, nor has much economic sense. Developers NEED to make money. Developers NEED to move their products. They do not NEED Chicago to do those things.
Brown's 10% set a sides will drag Chicago development to a screeching halt. Take a look around the area where Cabrini is/was. Many 3-flat condos sprung up on the rubble of the high-rises. Those 3-flats already have the set a sides. They are sold to yuppies promising them that the projects are going away and if they buy now their property values will skyrocket. What the yuppies were not told is that the residents for the high-rises would be moving in with them! Many of those condos are empty and for sale.
4 comments:
yes,
when the pols figure out the game it is surely over. those cabrini 3 flats are mixed income meaning 1/3 pay market rate, 1/3 pay reduced rate and 1/3 are project people. i drove by once, saw the 300,000 price sign, and asked a dissadvantaged black youth exiting the building what it cost to live there. 100.00/month was his response. so a yuppie pays more in monthly taxes than 1/3 of his neighbors pay in rent.
what a country !
i would like to sit in on an associatiom meeting.
Correct me if I am wrong, but...
A good est. of property taxes is to take 1.6% of the County's estm. value. That is the amt of taxes a property owner will owe in the year.
However, new construction is taxed at 1.6% of the SALES price. This is very important and is not fully understood by many yuppies purchasers.
So a new-con condo bought at $300,000 x 0.016 = $4,800 yearly taxes. That's $400 a month added to the mortgage note. Also a $187 tab going rate of assessments.
That's almost $600 in non-mortgage dollars flying away.
just stopped and talked to a woman outside of a new single family home near 50/ashland. she said the 2 story 3br house w/bsmt & garage cost 170,000 but she recieved a 70,000 grant and paid only 100,000.
this woman went on to tell us that she works for the city in a job i know pays at least 40,000. a house like that in my area would be at least 500,000 and way out of my reach seeing as i make only 30,000 more than the woman.
now i know i am white and have no hope of getting the 70,000 grant but would i be allowed to purchase one of the houses for 170,000 ?
assuming this is some sort of affordable housing programe will the woman be made to sell at a controlled profit to maintain affordability or market rate for a second windfall grant/ wealth transfer?
The city has various programs to encourage investment and homeownership; I don't work for city government, but I'm sure they have special programs for employees. I used Neighborhood Housing Services to get my 30-year fixed mortgage in early 2004. They also arranged a 15-year fixed loan for the rehab work that was needed for me to move in. (And, yes, there are still some fixer-uppers around going for about the same amount as I paid back then... the soft market has chased away the idiot flippers, meaning that prices on distressed homes have plummeted, even while move-in-condition prices are pretty stable).
Also, NHS broke my mortgage into 80% and 20% so I don't have to pay PMI. And they know about special tax programs that can get you even bigger tax refunds than you'd normally get by owning.
Now, these programs are there to encourage neighborhood revitalization, so you're not going to find one for Old Irving Park or Lakeview. And, if you're not looking to do much work to an existing home, you're probably out of luck... move-in condition houses just ain't cheap. But, if you're looking to own for a while (as opposed to the idiot flippers) you can build up equity. And, if you don't grow to love the neighborhood, at least you have a little something for a down payment somewhere else if/when you decide to move.
Hope this helps!
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