Saturday, December 31, 2016


This is the preface of my book on this issue. I am advocating social change to complement public policy in local housing markets across the United States. Social change is needed in form of voluntary network of all-income-level investors collaborating to manage individual real estate for nonprofit mutual benefits in various local housing markets. Whereas attempt is made to write the book so that every family could understand how to get involved, it requires some knowledge of real estate management and the nonprofit sector to provide the social change leadership. It is about investing in local housing markets for the mutual benefits of helping one another to work and live comfortably in decent homes in various communities.  Every family would normally want to be carried along to attain some measure of financial security since rent or monthly mortgage payment is the largest expense item of many families.

The housing needs of American families have been taken from the purview of employers of labor. Employees have to figure out how to invest to meet housing needs to improve the well-being and living conditions of their families. This book is written to help every family get involved in various local communities as investors in housing. Though housing is the first basic need to work and live in any community, the decision to participate as an investor or just a consumer is idiosyncratic. Every family could be given the opportunity to invest and become home owner through nonprofit real estate management in various communities. Although our politics remains divide-and-rule, economic issues about housing needs are two sides of the same coin. Every American family has right to adequate and decent housing as landed property.

Saturday, November 26, 2016

Home Ownership is an Extension of Property Rights

Since a home is basic need commercial rental properties do not have to negate the goal of housing every American family irrespective of income level. Commercial interests have to tie home ownership to income levels to stimulate active participation of families in the investment activities and circulation of money in the communal leveraging efforts. There is no law specifying that a family must attain certain level of income to invest in home ownership since housing is basic human need. I pointed out in previous blogs that rental housing has always been a proportional part of every local housing market for leasehold arrangements among households. Since a home is basic need every family should normally seek to participate in the local housing market as an investor.

To ensure social justice, American families should not be inadvertently dispossessed of their property rights by commercial interests. That is, our public policy must continue to promote active participation of families in their local housing markets as investors. Home ownership is the great equalizer. With the expansion of commercial interests, home ownership could become morbid desires. At the same time, commercial interests continue to promote various forms of exploitative deals in equitable values of landed properties. Some scholars are already advocating re-thinking of home ownership disregarding the need to encourage families to invest their local housing markets. Community Housing Market Support Network Inc (CHMSN Inc.) is encouraging active participation in your local housing market as investors. Real estate is not a wasting asset. Its equitable value appreciates overtime if properly maintained. 

Wednesday, November 9, 2016

There are general misconceptions about home ownership and rental housing market that need clarification for successful maintenance and management of housing units as capital assets. The misconceptions are due to the paradox of housing as landed properties with respect to land tenure and land value. Every housing unit has to be developed and/or maintained at a unique location for considerable length of time or tenure. Also, though a housing unit depreciates with respect to its development costs overtime; its value overtime appreciates in terms of supply and demand. Although this depends on the changes in the community, the home owner has right to the equitable value for managing and maintaining the landed property overtime. All the characteristic features make a local housing market heterogeneous and monopolistic with respect to available housing units. Disregarding equitable rights of owners of landed properties has led to various misconceptions about home ownership and rental housing market in terms of buying and selling.

However, the legal system of possessing and using landed properties is outright purchase or leasing. Rental housing market is in fact leasehold housing market for various forms of arrangements among households to meet housing needs. That is, irrespective of income-level, a household could still choose leasehold arrangement to meet immediate housing need for shelter. This implies that vice-versa a household, irrespective of income-level, should be able to choose among a spectrum of leasehold arrangements up to home ownership to meet housing need since every household is being leveraged. Therefore, the relationship deserving nonprofit management attention is not capital value and rental value of landed properties, but capital value and equitable value of landed properties. Landed property owner should be free to market equitable value of landed property to encourage innovative and competitive leasehold arrangements among households.

Ideally, low income households could be leveraged indirectly through various innovative leasehold arrangements. To be equitably leveraged, families with low incomes only need nonprofit holding and management of the landed properties as capital assets in their local housing markets, not rental homes. However, the common understanding about local housing market is a particular community or neighborhood where one could either rent or own a home. People do not commonly think of local housing market as a local environment where various housing needs could be met as landed property rights are sold and purchased to work and live in the housing community. In view of the general misconception, renting a home is equated to permanent housing. This has led to thinking that some households need subsidies to gain access into their local housing market either because their incomes are too low or because housing prices/rents are too high. Consequently, a local housing market is thought to comprise of market rate and subsidized housing. The ambivalent conceptualization is currently preventing efficient local housing markets in various cities in the United States. Community Housing Market Support Network Inc (CHMSN Inc.) is a nonprofit institution set up to address the misconceptions in Louisville metro housing market.

Tuesday, October 25, 2016

Home Ownership is a Legitimate Aspiration of Every American Family

 Last week, I pointed out that the declared goal in the Housing Act of 1949 is for every American family to be able to have a decent home in a suitable living environment.  Thus, it is reasonable to infer that the Housing Act of 1949 effectively moved housing needs from employer-employee concern to public-private concern. It would not have been necessary to continue tying housing needs to income levels. However, outside coercion or voluntary participation, commercial interest with income as common denomination is the only communal means to house every family. Commercial institutions had to tie investments to meet housing needs to income and credit worthiness to ensure reasonable contributions and active participation in the communal leveraging efforts. Conceptually, mortgage payments are periodic investments for acquisition of equitable property rights at particular location in line with American philosophy of home ownership as the great equalizer. The owner of the equitable property rights is responsible for managing the development, use, value, and tenure as landed properties. Thus, a decent home in a suitable living environment is a capital asset that the owner could sell or transfer if the living arrangement changed.

It is necessary to further clarify the public policy goal in the Housing Act of 1949 in light of the foregoing conceptual explanation of home ownership mortgage. Reasonably, it could be inferred from the declaration in the Housing Act that public policy in the housing market is to ensure that every household is equitably leveraged. However, the Housing Act was not enacted to reflect that goal. Hence, Hoffman (2000) considered the Housing Act of 1949 a study in contradictions and its programs as failures. To gain access into a local housing market as a matter of social justice requires resolution of many related public policy issues at the local level because of the nature of housing as landed property. Apart from land use and land development planning issues, there are ownership legal and social issues as well as the underlying societal issue of income distribution for ensuring equitable transactions among households.  Also, there are building-code issues for durability, maintenance, and betterment or future improvements as capital assets. Hence, the public policy of housing every American family as soon as possible in the Housing Act was appropriately declared as a general goal rather than specific objective for implementation programs.

Furthermore, due to historical and political evolution in the United States, the social issue of racial discrimination in the local housing market quickly dominated the public policy. Some of the issues had to be addressed by regulations without understanding how the local housing market could be impacted. Although the Fair Housing of 1968 is to ensure social justice, affordability remains an issue. While it is still reasonable to assume that public policy in the housing market is equitable leveraging of every family, there is need for active participation by every family. Every American family should be able to invest to acquire decent housing as capital asset for improved living condition in a local housing market. In other words, irrespective of income level or credit worthiness, every American family should be able to have landed property rights in form of a decent home in a suitable living environment to ensure social justice. Housing is part of community economic development.  Today, homelessness in any community in the United States is an aberration. Housing need has been taken from employer-employee to public-private concern.

However, every local housing market needs social entrepreneurial roles of nonprofit sector institutions to make the market more efficient. Community Housing Market Support Network Inc (CHMSN Inc.) is a nonprofit institution set up for that purpose in Louisville metro Kentucky. Such organization is indispensable because there are many areas of misconception in the housing market that cannot be addressed by rules and regulations as public administrators are often tempted to think. There will be subsequent discussions about such misconceptions.
Hoffman, A. (2000). A study in contradictions: The origins and legacy of the Housing Act of 1949. Housing Policy Debate 11, 2, pp. 299 – 326. 

Tuesday, October 18, 2016

How to Navigate Your Local Housing Market

Housing is the first major need before having access to other supportive services to work and live in any community. Therefore, it is a public-private concern because every family needs shelter. A decent and adequate long-term shelter involves significant landed property investments making it a capital asset for improved living conditions. Every household invariably requires some communal assistance or leverage to meet housing need as capital asset. Early savings and loan associations in the United States evolved from this conceptual understanding and became a strong force through mortgage lending in the twentieth century. This system of housing finance has been reinforced by various governmental interventions in the financial market because it amounts to communally leveraging individual household to acquire housing as capital asset.

To solidify and further reinforce the system of housing finance Fannie Mae was established by the government in 1938. It became the giant player in the secondary mortgage market at the stock exchange. Before then, the Act of 1934 had established the Federal Housing Administration to take up homeowner mortgage insurance scheme to ensure continuity of the housing finance system during the great depression. The declared goal in the Housing Act of 1949 was for every American family to have a decent home in suitable living environment. Freddie Mac was established in 1970 as another giant player in the secondary mortgage market to avoid monopoly by Fannie Mae while both continue to enjoy implicit government backing. Thus, the housing finance systems to meet housing needs in the United States had long become a private-public concern.

However, nonprofit sector institutions are still struggling to identify their unique intermediary roles to complement public policy in their local housing markets in the United States. The American philosophy is that private property rights are derived from the principles of right to life so that every individual could have some measure of freedom and moral authority. That is, everyone deserves some private property rights or some rights to privacy. Although there is no income requirement to become a homeowner, commercial interests have tied income levels to home ownership while this is been reinforced by various forms of public interventions. There are various innovative arrangements that could be explored to lease, rent, or transition into home ownership irrespective of income level. This is the focus of Community Housing Market Support Network Inc (CHMSN Inc.). CHMSN Inc. is a nonprofit residential property management organization in Louisville Kentucky helping to develop or rehabilitate households as they transition into home ownership regardless of income levels or credit history. Approaches can be replicated in other cities.