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8/28/2008

How to Save the Real Estate Market...

...in two paragraphs or fewer.

And I will make them short ones.

Cut property taxes and assessments right now.

Free up capital by not only allowing but encouraging individuals to lend directly in the real estate market.

I will address the "individual lending" model in a further post.

But, on to my "cut cut cut" for property taxes.

We have already seen that the tax cuts of the last several years have helped Houston avoid the worst of the real estate bloodbath. We avoided any downturn at all far longer than other markets - including ones that had similar moderate price increases in the first half of the decade.

So, we know cutting taxes helps make real estate affordable on the margins and is capitalized in value, so why not just take this "great advice" and just do it?

It would certainly cause a few other issues such as "how can we afford all the government services if we lower taxes?" But this intriguing question was not one I promised to tackle in two paragraphs.

Maybe a rephrasing of the question should be: "Are we as citizens so happy with each and every expenditures of our local governments, and particularly our schools, that we should allow our largest asset to continually depreciate?"

Hmmm. Guessing not a lot of "aye"'s on that one.

The Nay's have it.

If I may add a third suggestion, cut government spending.

Posted By: HoustonRealNews Market Analyst
at 8/28/2008 10:20:00 PM

Permalink | Category: Finance 'em | Comment On This Post | Reader Comments (1)

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