LEGISLATIVE AFFAIRS: Key Fixes Needed for the Housing Market
Philip Weiden | November 1, 2016
There are many headwinds facing the overall housing market in New York State. Some of them are high property taxes, strict land use regulation, and difficulty saving for a down payment. Student debt has also been a big factor in preventing a boom in the housing market.
What can be done to address some of these issues? Let’s start with the first one—high property taxes, which prevent many, who could otherwise afford the purchase price, from being able to purchase a home. In many communities it is not housing prices that are the chief impediment to buying a home, rather it is the inordinately high property taxes. Taxes have doubled in many areas in just a few years time or, as in some cases, the property is not correctly assessed. Besides school districts, all other levels of government are easily able to bypass the property tax cap if they get a three-quarter’s vote of the governing body to break the cap.
Another contributor to high property taxes is the out of control cost of benefits and pensions to employees. I am not advocating we tear up contracts, but I am suggesting that government be somewhat more realistic as to when people can retire. Life expectancy has increased meaning that people live a lot longer on retirement income. NYSAR has supported reforms to the pension system in the past and we must continue to do so in the future.
People claim they want lower taxes but refuse to give up their local level of government, which costs a lot of money to maintain. Government needs to be funded if we are to preserve the services that come with that.
The New York first time homebuyer program is a way to address saving for a down payment. If legislation is passed, it would allow married couples to save $10,000 tax free ($5,000 for single taxpayers) in a savings account. For many this could be the difference that would enable them to purchase their first home. There is a call for action for this bill. Please respond; it is critical that we get first time homebuyer legislation passed.
When it comes to land use regulation, New York State will always remain a home rule state meaning that zoning issues are determined by local municipalities. Therefore, it is imperative that residents attend their town, city or village meetings to support economic development projects and not oppose them because of traffic or other concerns. Residents should push for changes to mitigate problems, but not outright reject a proposed development project. Developers do need to listen to local communities and address issues that residents are concerned about. The environment and traffic are legitimate issues to be addressed, but worthwhile projects must be allowed to go forward or ultimately the tax base shrinks and property taxes will continue to go up.
Finally, student debt is another issue that is holding back home ownership for first time buyers. We must reduce student debt or Millennials will continue to stay on the sidelines of the housing market.