It’s never been easier to
Become distracted. Don’t.
Residents of the Japanese island Hokkaido faced an existential threat during the winter of 1915. A massive Ussuri brown bear had been spotted by villagers in the fields feasting on their much needed crops. Sadly several days later the bear would come back, this time entering the home of a local farmer and violently mauling his wife and children. The townspeople quickly armed themselves and split into two separate groups, one to hunt the bear while the other was tasked with protecting the women and children. The goal was clear, to end the danger.
As expected, the bear reappeared that very night and was promptly shot and chased deep into the woods heading north. Hearing all of this commotion, the second group met with the hunters expecting to see the carcass of the deadly attacker. Unfortunately what the islanders didn't realize was that the bear had actually fled to the south. While the two parties were away the bear again returned to the village, this time killing the eleven unprotected women and children. By allowing themselves to become distracted, the village suffered a loss the size of which it would never recover.
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SoS: Shiny object Syndrome
In response to rising costs, lenders are starting to offer 40 year mortgage products. Grant programs aimed at new and low income homebuyers are becoming increasingly more available. Some municipalities have even taken action against short term rentals. For a growing number of Americans, housing affordability is a problem. These actions however are not solutions, but instead serve only as a distraction.
The squeeze
Capital Region home prices have climbed 16% in just the past two years. While employee salaries have had a strong twelve months, the growth nowhere near matches that of the cost of housing. According to data from the National Low Income Housing Coalition, a person living in the capital region would need to earn an hourly wage of $23.86 to afford a two-bedroom apartment at the fair market rent. This is significantly higher than the state's minimum wage of $14.20.
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Lower...but higher
While the Federal Reserve’s warpath against asset prices has been successful in lowering prices, the relief for buyers has been more than wiped out by the rise in interest rates. A mortgage originated in December 2022 (20% down on a median priced home) requires a payment 62% higher than it did to start the year. That is staggering. Also keep in mind this does not take into account insurance premiums, which according to policygenius for many homeowners increased last year by double digits.
While not easy, there are steps that can be taken to improve the situation. Encouraging students to enter the trades is an important step. As we become more and more a nation of people unable to fix things, those who can will be able to essentially name their salary in the years ahead. Restrictive zoning needs to become a thing of the past. California has given the rest of the country a road map on how to achieve this. And finally, making accessory dwelling units permissible on all residential sites (acreage permitting) is a no brainer. Housing is as basic of a human need as there is. Let’s not get distracted from that.
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NYS Fair Housing Notice
Steven Luttman
Broker/Owner SJLincoln Realty
35 Bath Street, Ballston Spa NY 12020
(518) 309-8584