[quote=joec] . . . I just think folks who are blinded by “MR” BAD BAD BAD will do anything to avoid it even if the house was $1…[/quote]
joec, all the money every year a homeowner is sinking into MR not only is only partially or not at all tax deductible, it is NOT paying down the mortgage loan itself. Thus, the property is not worth all the purchaser is paying into it every year. The money could instead be spent at Home Depot, Lowes, etc., ostensibly to ADD to the property’s VALUE, but it is NOT. It’s going out the door, never to be seen again.
Instead of adding to the value of the property, the still unpaid portion of the MR bonds are actually a DETERRENT at resale time, LIMITING its buyer pool to those willing to assume repayment of the bonds.
There is no evidence that MR areas have higher resale value than older, more established areas which predated the use of MR bonds. Actually, the reverse is most likely true as, in CA coastal counties, the older areas are built upon the most DESIREABLE land, leaving the least desirable land to the developers who had to use MR bonds to fund the infrastructure and subsidize the existing police and fire services, etc (from 1987 forward in SD County’s non-infill projects).
These developers use showy, mesmerizing, high-end “model-home furnishings,” decor and lighting to sell an as-built or future-built model of the same floor plan. The actual home purchased will not look or “feel” anything like the model the buyer(s) toured because it doesn’t have it’s $80K – $100K in “rented interior,” $20K – $60K in landscaping and often the premium lot/view/elevation afforded the model. What they are actually buying is often cavernous (utility- sucking) and sterile-feeling with a dirt backyard and possible slab patio. In addition, there are often NO NEARBY SOLD COMPS available to justify the prices the developer is asking.
This developer “showmanship tactic,” amazingly, seems to be enough to suck buyers in, EVEN WITH ALL the decent resales simultaneously on the market. The full realization of that pesky MR added to property taxes likely doesn’t really set in in the buyer’s mind until they recieve their first full property tax bill (not supplemental bill).
All this nonsense will come to an end when SD County runs out of land to build on. By then, a third or more of the county’s homeowners will be mired in MR debt for longer than it takes to raise their kids :={
