Too Many Brokers Do Not Understand the Auction Concept
I was very interested in your recent article on the subject of real estate auctions (“Do I Hear A Bid?”, January 2004). I have sold real estate at auction both in the U.S. and the United Kingdom for 30 years, and it is a constant amazement to me how real estate brokers continue to put down the auction method for the disposition of real estate. The truth is that 99% of brokers do not fully understand the concept, and therefore their reluctance to use auction is borne out of ignorance.
I thoroughly agree with the observations of the auctioneers in your article. One of the problems with private individuals who want to auction their property is that the loan balance is usually too high, and they do not have the funds to pay for the advertising that is agreed upon upfront. Also, the article mentioned the “time to do due diligence.” We always investigate any property for auction before we set a date for the sale. The potential buyer then can do his own due diligence to avoid problems.
W.J. Warren, President
Warren & Associates Inc.
Homeownership Incentives Needed
In the column “Additional Homeownership Incentives Called Into Question” (January 2004), Howard Menell, tax advisor for the National Multi Housing Council, argues against pending federal legislation aimed at increasing homeownership opportunities for minority, lower-income and first-time homebuyers by making all forms of mortgage insurance tax deductible. He does so without disclosing that he is a paid lobbyist for the nation's for-profit apartment building and apartment complex owners. It's unconscionable that anyone would argue that America is somehow better off if certain people are intentionally deprived of the opportunity to buy their own home as a matter of government policy.
Making mortgage insurance premiums tax deductible will increase homeownership opportunities among those Americans who need help the most. Traditionally a homebuyer had to save a 20% down payment to consider buying a home. Today, products are available that allow for as little as 3% down, but they require mortgage insurance to make them viable financing options.
The legislation to make mortgage insurance tax deductible enjoys the support of more than 150 Members of Congress and a dozen U.S. Senators from both parties. Labor unions and consumer groups on the left and tax reform and business advocates on the right strongly advocate this reform. It is supported by Hispanic organizations, civil rights groups, prominent consumer advocates and organizations representing teachers and police officers. This is because in addition to taking an additional 300,000 people out of apartments and putting them in their own homes, this proposal will create an anticipated 150,000 to 250,000 new jobs in home building and related industries.
Policy makers will either support this legislation or they will quibble over the difference between interest payments and mortgage insurance to avoid a low cost way to help families qualify for homeownership. I am sure Mr. Menell would feel in good company with many advocates for this legislation, as they also support the Low Income Housing Credit and the creation of a Housing Trust. There is no inconsistency in supporting the broadest spectrum of housing opportunities for Americans. Doesn't everyone agree there is an affordable housing crisis in America for rental and homeowner units?
Dr. Bill Spriggs, Executive Director
National Urban League Institute for Opportunity and Equality