Should We Subsidize Lincoln’s Home Builders?

June 27, 2008 at 2:05pm By: Mr. Wilson Posted in The Lincolnite Blog

Mayor Chris Beutler wants to give you $1,000—but only if you buy a new house. The proposal is designed to help kick-start a stalled local housing market. Currently, 326 new homes are sitting empty.

The proposal smells a little off to me, for three reasons. First, there’s the amount of the handout. One thousand dollars isn’t much, and I have a hard time thinking that the payments will be much more than a gift to people who were already planning to buy a house anyway. If you were to give me a grand to put toward a car, I’d talk. But a house?

Second, the payments create a disincentive to inter-city neighborhood rejuvenation. With all of the City’s talk about improving “The Core” and keeping Lincoln’s neighborhoods vibrant, why would Mayor Beutler want to offer an incentive that pushes people to the city’s fringes?

Last, the Mayor is proposing to spend up to $610,000 on this at a time when we still face a $1.5 million budget shortfall. City employees are losing their jobs and City services are being axed. Is subsidizing Heartland Homes et al. really the best use of $610,000 we can think of right now?

If the Mayor really thinks that propping up a struggling construction market is a big priority, I suggest he focus instead on his “one-stop development shop”. (Blurb in article linked above.) Cutting government-related costs for the local construction industry is a much better way to support the economy than simply handing out cash payments.

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The Comments

Moses June 27, 2008 at 8:07pm

This is throwing money away. A $4,000 rebate on a $25,000 car may get someone more interested in buying a vehicle.  $1,000 on a house is not going to prompt anyone to buy a house who was not going to buy anyway.

meatball June 27, 2008 at 8:54pm

Or dump impact fees.

Mr. T June 27, 2008 at 11:27pm

I agree with this thinking. $1k is just too small to make a dent.

I would be interested in knowing what new home buying rates are in surrounding communities. Are we losing people to the smaller towns in Lancaster County?

Neal June 28, 2008 at 1:23am

New home sales are suffering everywhere. Credit is harder to obtain, and home buyers are increasingly looking to older houses that retain their value better.

Lincoln isn’t going to reverse a national trend with $1,000 giveaways.

awtm June 28, 2008 at 1:24pm

We have just moved to Lincoln, and are in the house hunting process, $1000 dollars would not be an incentive to do much. 

Seems like a ridiculous notion

I could see a $1000 dollar incintive to buy an energy saving home, or an older home in an area that could use rejuv, but for “new home”?  Most new homes here are $225,00 +.

Gene June 30, 2008 at 1:15pm

Business haters.

Moses June 30, 2008 at 1:36pm

Just saying that $1,000 per house is not going to change anything for anyone.  This is like forgiving the gas tax for the summer.  Sounded like a good idea for about ten minutes until someone started to do the math.

Neal June 30, 2008 at 5:16pm

Mr. Wilson, I nominate this for comment of the week.

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