San Diego Housing Market News and Analysis
Oops -- Were We Supposed to Buy Foreclosures With That $70 Million?
Submitted by Rich Toscano on August 24, 2011 - 4:03pm
Hi Piggs -- Apologies for the lack of content; I've become rather buried with that pesky day job once again. I'm going to try to get some material up this weekend.
In the meantime, I think many Piggs might be interested in this recent article from Will Carless at the voiceofsandiego.org:
Back in the depths of the housing bust, the San Diego City Council ordained that the Affordable Housing Commission could start buying foreclosures.
At the time, I argued against this policy. Exactly how does spending taxpayer money to create artificial demand render homes more "affordable?" (Affordability being an outcome which, presumably, should desirable to a group called the "Affordable Housing Commission.") It doesn't, of course. I felt this was yet another bailout-style intervention that used taxpayer money in the pursuit of preventing homes from becoming affordable again.
Well, as Will's article makes clear, my argument was moot. The commission didn't use their money (and the reduced oversight they got as part of the deal) to buy foreclosures, but instead bought apartment buildings (not in foreclosure) and lent the money to developers to build more "affordable housing" apartments.
Regardless of what one thinks about what they originally said they were going to do, the point is that they didn't actually do it, which is fairly messed up. What makes this more messed up was outlined in Will's original piece, which makes it clear that the "affordable housing" they were funding was actually quite swanky and immensely cost-ineffective.
Enjoy these interesting and frustrating reads...
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