How Much Would You Pay?
Jon Hockenyos makes a radical proposal that cities should establish their own terms for how much local property is worth, free of "market value", in order to unstick frozen property markets.
Hockneyos writes, "...it might be possible to form a consortium of local (ideally, locally-owned) banks who could agree on some common standards for valuing real estate for collateral purposes (perhaps some figure at, or close to, the appraised value of the property for tax purposes). This is a departure from standard practice, as the 'market' value of the property is generally considered the appropriate measure. However, right now there is no market in many places, and the absence of transactions makes an accurate measure of the market value impossible much of the time."
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The Prices of Housing are
The Prices of Housing are doing what any asset subject to risk, buyers and sellers demand and supply, should be doing. they are droping. This is what they should be doing. To do anything else would cause a larger and longer negative effect than the great depression, the recent credit crisis, the dot com crash, and Long Term Capital combined. The Market will settle itself or re-set itself. The question is, what do we do to un-wind the unecessary Public Policy that has come along when the asset prices themselves were climbing (peaking about 2006), such as property assesment caps and millage caps. I am not arguing for more local taxes, simply stating the obvious, we could all use a diet on our expectations of local government and reconsider our willingness to pay.