California ramps up the crazy, wants to own 45% of your home

55 Replies

The only good thing coming out of California these days is that more and more, the good people of the state are being motivated to take it back into possession.

There are far better ways to help people homeowners. (In fact, my prediction is that this plan actually will continue to exacerbate housing issues in the state.)

Originally posted by @Theresa Harris :

In Canada the government introduced assistance with the down payment portion with certain conditions (https://www.cmhc-schl.gc.ca/en...) for first time home buyers. nothing to do with race.  It is 5-10% and when you sell, they get a percent of the profit.

For the CA one, I get trying to help people but 45% is huge and why only a group based on race?  I get if it was based on first time home buyers or perhaps income, but not race and not 45%.  I wonder how many who take advantage of it (assuming it goes through) will then claim it wasn't fair when they sell their place?

California is all about opposites.  They say that this plan is to 'help' people.  It won't. (And that's actually their plan.)

Originally posted by @Nathan G. :
Originally posted by @Travis Jacobs:

About half of Mortgage backed securities are owned by the U.S. Government already so I guess you can say in a sense they already own half of all properties across America with a loan on it. Any central planned program ends badly. This would be one of them. If prices do rise it would most likely be temporary and then stagnate/decline again. By a tax stance they own all lands where homes sit/don't sit on as well if those taxes aren't paid, this includes farm land.

What's the largest percentage of ownership you've ever seen on a mortgage? 3%? Maybe 7%? I've never seen even 10%.

I'm confused on your response. Are you talking about me directly? The U.S. government? Or individuals?

Originally posted by @Amie Peralta :

The only good thing coming out of California these days is that more and more, the good people of the state are being motivated to take it back into possession.

There are far better ways to help people homeowners. (In fact, my prediction is that this plan actually will continue to exacerbate housing issues in the state.)

Originally posted by @Bill Brandt :

@Caroline Gerardo

Are they going to be able to qualify and/or keep up if they are effectively paying 200% of California’s already high property taxes? Taxes that will be climbing twice as fast as everyone else’s’ because they are based on twice the property value. 

Great question!  Then consider how hard UBI and unemployment is being championed by the same 'leaders' that put this ownership plan into place.  The answer is, in the end.... you will own nothing if you reside in the state of CA.  Ownership privileges are slowly being transferred elsewhere.  Honestly we shouldn't be trying to figure out how this policy will 'help' anyone, because we know that long term it won't. California hasn't passed a 'helpful' piece of legislation in.... I don't know how long.  There are better ways to help people own homes, but that is not the goal here... so voila, the state will own 45% of your home (for now) (and let's not come up with an alternative).

@Amie Peralta the proposed bill is structured as a bond program. CA will deposit initial funds and sell it to investors. Borrowers fully qualify with back end debt to income ratio not to exceed 43% (tiny house for two w-2 earners in California) It maybe buys a $500000 house inland. The state fund is a silent second due and payable upon sale of the house - borrower qualifies for $250000 loan with the actual taxes and insurance. Maybe with the funds offered it's 4-5000 houses- not a big number in the total market. I do not agree that the plan is intended to harm people. There are 40 down payment assistance programs in California this one offers larger dollar amount to borrowers of certain race. I wonder how will they determine race ? DNA test? 

(My children are seventh generation Californians, I plan to stay. {waves bear flag of CA}