Nothing Fuzzy About Affordable Conversion
Lower-income earners who’ve never bought a home before will get an unusual shot at living in an historic building. According to the Brooklyn Downtown Star, an 1890’s police building at Humboldt and Herbert in Greenpoint is slated to be turned into 14 condo units subsidized by $1 million allocation from the North Brooklyn Development Corporation…
Lower-income earners who’ve never bought a home before will get an unusual shot at living in an historic building. According to the Brooklyn Downtown Star, an 1890’s police building at Humboldt and Herbert in Greenpoint is slated to be turned into 14 condo units subsidized by $1 million allocation from the North Brooklyn Development Corporation and another $300,000 from the borough itself (how does that work?). As someone who has been admiring this building for the past several years, all we can say is that this is a huge score for the lucky few who win the lottery. One drawback: Because of the subsidies, owners will not be able to benefit from any price appreciation that may occur over time.
Seminar Preludes Affordable Housing [Brooklyn Downtown Star]
I’m still reading too and thats a pretty decent compromise Amy.
sounds like a great solution- everyone wins. (Yes, I’m still reading!) 🙂
OK, I doubt if anyone is still reading this thread, but how’s this for a solution (you know, if we ruled the world and could make city policy)?
As someone who meets the income requirements and wins the lottery, person A gets to buy a unit for $300K that would normally sell for $600K – half market value (as determined by an independent appraiser or three). Owner A could choose to sell anytime she wanted to, but she gets to keep only half of the profit over the original market rate of $600K. For example, if she waits a few years and sells to owner B for $900K, she can keep $150K profit. The remaining $450K (the other $150K profit and the original $300K subsidy) goes to subsidize the next buyer (B), who in effect will be paying $450K for a $900K apartment. When owner B decides to sell 10 years down the road, he sells for $1.9mil. He gets to keep $500K. Remember, he gets to keep half of the profit (half of $1.9mil-$900K). The remaining $500K, plus the $450K subsidy that owner B got, gets passed to the next buyer, who in effect will be paying $950K for a $1.9mil pad.
No matter what happens to the market, no matter how long a buyer decides to stay, the buyer will still realize a profit relative to his risk and the market while the next buyer will still get a subsidy equal to half the price of the unit.
I’m assuming of course that the market stays flat or rises. If the market falls, the subsidy always gets paid back first before any profit can be taken. If the subsidy can’t be paid back in full, then the next buyer gets a smaller subsidy. But that’s fine, because they will also be paying a lower price than the previous buyer.
Confused? Me too. But the math works.
Many of you seem to be under the assumption that these subsidized houses are for poor people. In the past at least, they were a mix of lower middle class and working class units. Not only were there maximum income limits, there were minimum income limits. Some of these units were sold slightly below market value and the buyer had to commit to live there for about 15 years. If they sold early, they had to pay back a pro rata portion of the subsidy. Others were sold at market value with no subsidy. These were no handouts. They provided some stability to “fringe” neighborhoods and gave working people a chance at home ownership. My mother, a nurse and I (a college sophmore at the time) were one of the buyers of a condo and Fort Greene was the “fringe” neighborhood in 1989 when crack vials still littered the street. In retrospect, we probably could have gotten a brownstone in Fort Greene for less than we paid for the condo but were too inexperienced to know better. However, we sold at a slight profit in the middle of the “discovery of Fort Greene”, bought a brownstone in Bed Stuy (another “fringe” neighborhood) while we could afford it. We sold two years shy of the 15 years and paid back a portion of the subsidy.
I can attest that the system worked. Owning that Condo afforded us to take partake in the American Dream. However, many if not most of our fellow owners remain and are enjoying being a part of the initial “gentrification” of Fort Greene.
I’m with you 100% Bx2Bklyn. Why hate on the owner of the Fulton St. townhouse. He/she/they got lucky. No one could have predicted it. We might as well start hatin’ on the people who own the townhouses on Grand between Greene and Gates. They were affordable housing at one point but now the area is beginning to look exclusive (at least from the outside). It’s America and part of the dream is moving on up, lottery or otherwise.
I can understand stuy blkbuttrflie’s point though. Radical as it may seem, I think she’s arguing for limits (e.g., limits on welfare dependency). Which I’m all in favor of. Safety nets are important but they can easily become self-defeating if we don’t provide people motivation, incentives and opportunity to get off public assistance.
FYI- I grew up dirt poor in a Bronx projects, and I’m white. Being poor sucks. A hand out and a hand up are two different things but if you offer someone a hand up, don’t let go halfway up the slope. By the way I never suggested you wouldn’t live in those condos.I don’t say give the poor all or give them nothing. I am saying give them the respect of treating them like a true homeowner and if they succeed or fail that’s up to them, but you can’t control that.Everyone has a different life experience and you don’t know what someone has has to do to survive. But I find people will either live up to your expectations or live down to them- but the expectations are your own and not necessarily theirs. I don’t expect people to live life the way I think they should (now that’s unrealistic)except that they follow the law. And I can choose to help or not help based on what they do. But if I offer help, I do it wholeheartedly and without expecting something in return. I’ve had wonderful people help me when I needed it. And I spend every day remembering it.
its just a matter of what you consider real help. I know what corporations do for communities, I work for a VERY large financial corporation but I also understand what they won’t do and I know that corps will only do so much not because they necessarily care but because they need good PR. EVERY large company has some kind of philanthropy program or something similar because there’s an indirect way to make money from it and thats just the way it is I doubt they really give a damn about the poor. that being said, there’s only so much a company will do to but you claim to know otherwise so for the sake of people who need help lets hope that’ll happen. you’re making suggestions that I don’t see happening in the near future. I just consider my suggestion a bit more realistic but to each its own.
If they can find all that land, property and money for Ratner, trust me they can find it for affordable housing. Check out Habitat for Humanity to see a really successful program. I think we have a ways to go before we run out of land- simply because major areas of the city will build high density housing. THat’s been happening for years. What you really mean is what will happen to neighborhoods like Bed-Stuy and Crown Heights, etc.? I’m afraid they will simply become high density housing areas – exactly what Ratner envisions.
I am being very realistic- I assume you have no idea of the huge investments many major corporations already make to communities. Try going to some corporate websites and looking in their community pages. I am getting this stuff from experience and facts. I work for a non-profit- we are always looking into grants and funding so that we can offer our programs free to the people who need them.
As far as the money fountain- there is none. And the truth is there is no way society can help everyone. But is it better to give a little help to the many or real help to the not-so-many? The dynamics of society show that the latter does far more good in the long run. How many African AMerican people do you know who took advantage of Affirmitive Action programs and now hold powerful positions, AND give back to the community. I know quite a few. Of course not everyone was able to use the programs, so does that mean it was unfair? I don’t think so.
maybe it is, but they don’t have to choose to participate. they COULD choose to live somewhere where they gets nothing when they leave, they could chose to live somewhere where they’ll pay the entire cost of the apartment. they could chose to live somewhere where people piss in the stairwells and elevators because they have no stock in the building. maybe they’ll be better off if they do. you’re basically saying give the poor all or give them nothing. you also suggested earlier that I would never live somewhere like that which is a total lie I’d be the first person in line if I had the opportunity to get into a program like this even if I could only stay there for 25 years beecause they wouldn’t have to give me more than 10 I wouldn’t stay there that long anyway I’d try my damnest to get something better and understand that if I can’t then I just can’t. I know what its like to be dirt poor and thats why I’m so passionate about it because I truly believe that a program like this is not the total solution, but its helpful and because people generally want to do better for themselves they will be open to help at least until your beautiful affordable housing condos come into existence and they can all move out and sell at market rate and move on and move up.