A common set of problems plague the globe, more so in larger metropolitan areas - increasing inflation, office space issues, growing homeless populations, escalating crime rates (although it’s starting to dip in certain areas), pervasive drug use across urban and rural landscapes, and more. Could most of these problems be substantially alleviated if everyone was adequately housed?
Sure, call us starry-eyed idealists, but I know we are not alone. We see a potential vision shared by many, illustrating what our Bay Area neighborhoods, from Marin County to Santa Clara, might look like if we escalated home construction as if we were preparing for war. It’s a drastic measure, but then again, our housing situation has reached desperate levels. Here’s our blueprint for our local landscape:
This is a topic that has been a part of our discussions in presentations for a few years so we will offer some practical solutions:
At the Federal level:
1. Infuse investment into the necessary infrastructure for speedier construction: utilities, roads, broadband, electricity, etc.
2. Offer broad Federal tax incentives for constructing for-sale properties - particularly those in high demand - not just rentals.
3. Scrap SALT deduction caps.
4. Temporarily, if need be, lift tariffs on certain raw materials used in construction.
5. Reform immigration policies to allow more skilled workers to come to the US and expedite temporary work permits.
6. Establish a national, well-thought-out homeless policy that lays a clear path to housing, complete with binding responsibilities.
7. Invest in more renewable energy systems to provide affordable options, thereby reducing monthly ownership costs and local property taxes.
8. Extend more accessible financing options at friendlier rates for those needing more assistance in home buying.
9. Offer additional tax breaks for seniors or those hanging onto homes due to enormous capital gains taxes.
10. Adopt the Danish model of transferable mortgages.
11. Finance tech research (with contractual obligations) to advance building efficiency and modernize construction techniques to make them faster, cheaper.
12. Promote vocational training, especially in construction-related fields.
At the local Bay Area level:
1. Revamp local zoning laws urgently to allow for quicker, smarter construction while preserving quality of life.
2. Streamline local building departments to expedite reviews, approvals, inspections, and sign-offs.
3. Give local tax breaks for construction and home ownership.
4. Audit existing government-owned land and buildings to find potential housing development opportunities.
5. Upgrade transportation options and devise traffic/parking solutions, critical for cities like San Jose or San Francisco.
6. Urge Bay Area tech giants to finance/donate housing, alongside cultural institutions, with their name on them. Instead of SpaceX tourism, how about Musk Manor or Google Grove?
7. Enhance local governance efficiencies through effective management and automation to reduce costs and thus, real estate taxes. Simplify building codes to eliminate lengthy review processes based on facts and data, not opinions.
8. Develop more mixed-use, walkable communities to decrease commutes, traffic, pollution, and more.
9. Repurpose underutilized commercial properties for residential or mixed-use purposes.
10. Engage top architects to design affordable housing that is visually appealing, contributing to neighborhood desirability.
Sure, we can still build and sell more high-end properties. With so many referring to areas across the nation as ‘war zones,’ largely due to a dearth of affordable housing, why not tackle this as if it were a war? We’re paying the price either way.
By Mark Palermo
President-Palermo Properties Team
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