Let’s stop encouraging homeownership

Last updated on: October 21, 2017 at 11:48 am by Jane the Actuary

Let’s stop encouraging homeownership 2017-10-21T11:48:13-06:00 Jane the Actuary

LOGO Patheos Explore the world's faith through different perspectives on religion and spirituality! Patheos has the views of the prevalent religions and spiritualities of the world.

from Wikipedia; https://commons.wikimedia.org/wiki/File%3AOmer_Kem's_sod_house.jpg; By Solomon D. Butcher (1856-1927) [Public domain], via Wikimedia Commons

So, it turns out, the big adventure of the past week in the Actuary home has been dealing with a broken, non-repairable fridge. The new one will come on Thursday, but in the meantime, we have been keeping some perishables in a cooler (for which the ice melted unexpectedly soon, so I’ll have to replace the gallons of milk, and figure the margarine, cheese, and jelly will be OK).

I deliberated about what to do with respect to a new fridge — do we get French doors? An in-door water dispenser? Something super-high tech? Ultimately, partly because we don’t have a water line, and I don’t want to know the plumber’s charges for installing one, we went with a very generic model, the twin of what we have right now.

So, fine. It’s a hassle to have to deal with food-from-a-cooler until Thursday, what with trying to figure out meals that I can make that don’t require a lot of perishables, and needing to make near-daily trips to the store rather than my usual weekly trip. And it was depressing to have to throw out All That Food, and I’m a little worried the trash bin is now too heavy for the garbage truck to take it.

But I’m an actuary. So is my husband. One thing that means (besides the country’s lowest divorce rate) is $$$. We can deal with it. I mean, yes, I was in a crummy mood for the past week, and I’m now irritated that I need to spend some time cleaning a broken fridge, because it’s really starting to smell and my husband’s travelling so there’s no way to even get it out into the garage until he gets back, but we can deal with it.

But every time this sort of thing happens, I think, I can’t even begin to imagine what we’d do if we were barely keeping our heads above water as it is. I mean, sure, a couple generations ago, there would have been no fridge to break down — my dad still likes to use the term icebox, from his childhood. But consider that the costs of homeownership extend far beyond the ability to make a monthly payment, and can be some of the most substantial unexpected expenses an on-the-edge family can face: not just the fridge, but the furnace, the water heater, a plumbing problem, the roof, or a failed sump pump — all items which, perhaps, however many generations ago it was that we adopted this notion that “everyone should own their home,” and certainly in the days of the soddie above, either didn’t exist or could be presumed to be repaired by the homeowner himself. (I didn’t include washer & dryer because my impression is that outside my sheltered upper middle-class world, it’s fairly ordinary to take your clothes to the laundromat.) These are the sort of expenses that push people into payday loans and other sorts of debt that they struggle to climb out of.

And it’s not just harmless “nudges” that might be nudging in the wrong direction. Renters pay higher rents than they otherwise would because their landlords pay higher property taxes than they otherwise would, because they don’t get owner-occupier deductions and because their property is assessed at a higher commercial-property rate. Everyone pays higher taxes than they otherwise would because homeowners get tax breaks for mortgage interest and property taxes — the proposed replacement of various piecemeal deductions with one much larger standard deduction would treat renters and homeowners equally in this regard. And that’s not even addressing the government programs to give people the ability to buy homes in a subsidized fashion. As Megan McArdle wrote earlier this month, the U.S. is nearly alone in having a 30-year fixed mortgage as the standard manner of purchasing a home, and we don’t hear a lot of lamenting that Europe is just a cesspool of misery.

Now, granted, I wouldn’t go so far as to say that we homeowners should all be paying taxes on the imputed rent of our homes, like they do in the Netherlands. But I can’t support the Chicken Littles who say that the sky will fall if we stop handing out subsidies to homeowners.

Yes, we say, homeowners are more stable, and care more about their neighborhoods, so in order to have stable, cared-about neighborhoods, we need more homeowners. But it’s a circular argument: you create subsidies to move stable, responsible people into homeownership, then say, “homeowners are responsible people!” Did homeownership itself actually create these desirable personality traits? (And, yes, I’m aware that this is a simplification, and in a perfect world, I’d have enough time on my hands to actually dig into data on this point. But I don’t; this is just a break from Saturday chores.)

So, yes, this is my usual soapbox, but it seemed like a fitting time to climb on that soapbox, what with the new fridge and the tax reform discussions and so forth.

Image: from Wikipedia; https://commons.wikimedia.org/wiki/File%3AOmer_Kem’s_sod_house.jpg; By Solomon D. Butcher (1856-1927) [Public domain], via Wikimedia Commons

Uncategorized

homeownership

tax reform

Previous Post

October 19, 2017

Jane's Three-Step Guide to Surviving Trumpism

Next Post

October 21, 2017 An independent commission to discuss retirement security? Yes, please!

Browse Our Archives

Select a Category Actuarial/Retirement Issues Politics Uncategorized

Select a Month September 2026 August 2026 July 2026 June 2026 April 2026 March 2026 February 2026 January 2026 December 2025 November 2025 October 2025 July 2025 June 2025 May 2025 April 2025 March 2025 February 2025 January 2025 December 2024 November 2024 October 2024 September 2024 August 2024 July 2024 June 2024 May 2024 April 2024 March 2024 February 2024 December 2023 November 2023 October 2023 September 2023 August 2023 July 2023 December 2022 September 2022 August 2022 July 2022 June 2022 May 2022 February 2022 January 2022 December 2021 August 2021 June 2021 April 2021 February 2021 January 2021 December 2020 November 2020 October 2020 September 2020 August 2020 July 2020 June 2020 May 2020 April 2020 March 2020 February 2020 January 2020 December 2019 November 2019 October 2019 September 2019 August 2019 July 2019 June 2019 May 2019 April 2019 March 2019 February 2019 January 2019 December 2018 November 2018 October 2018 September 2018 August 2018 July 2018 June 2018 May 2018 April 2018 March 2018 February 2018 January 2018 December 2017 November 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 April 2017 March 2017 February 2017 January 2017 December 2016 November 2016 October 2016 September 2016 August 2016 July 2016 June 2016 May 2016 April 2016 March 2016 February 2016 January 2016 December 2015 November 2015 October 2015 September 2015 August 2015 July 2015 June 2015 May 2015 April 2015 March 2015 February 2015 January 2015 December 2014 November 2014 October 2014 September 2014 August 2014 July 2014 June 2014 May 2014 April 2014 March 2014 February 2014 January 2014 December 2013 November 2013 October 2013 September 2013 August 2013 July 2013

TAKE THE

Religious Wisdom Quiz

You have wearied the Lord with your words by saying all who do evil are good in his sight, or by asking where is the God of what?

Select your answer to see how you score.

Justice Truth Judgment Righteousness