I noticed that there hasn’t been a comment in over a week, so I thought I would add one. As I read through the comments I notice a common thread. When is the city going to do something? Why doesn’t the government force the banks to unload these properties? In short, when is someone else going to do something. Get real, they’re not.
Those out there with initiative have to help themselves. Perhaps a march on City Hall to press for changes that would aid those with initiative. Reconsideration of building codes which currently push renovation costs beyond reasonable limits. Wholesale tax takings which would result in auctions at actual value. These are never going to be “high rent” neighborhoods, costs, and therefore rents, have to be brought back in line with real values. It was the soaring “values” which lifted the required rents beyond the ability of likely tenants to pay. None of the three deckers shown could ever have produced the rents to service a $300,000 mortage and also provide any realistic amount of revenue for repair and maintenance.
Remember, falling “tax values” choke off the life blood of the city. They are not anxious to aid lower values. The days when they could assign $250,000 values to three deckers was a “high water mark” for them.
My last comment on what I would call the “Blue State” response of expecting the government to save us, leads me to another comment. In the past I have tried to use government programs in the renovation of older rental properties. What I found was, that in exchange for favorable financing, they wanted control of design and the use of “approved” contractors. Their idea of design was “barracks”, and the bids of the “approved” contractors were way out of line. I abandoned the idea and went ahead without them. I was able to do the projects at slightly more than 1/2 the sums bid and they do not look like barracks. When dealing with government people it has to be remembered that they are not “people who do” and they believe imitation is the sincerest form of flattery. It also allows them the excuse that “everyone else was doing it”. Didn’t their mothers ever say “if all of your friends were jumping off a bridge, would you do that too?”.
The programs work out rather well for projects undertaken, for their own account, by “approved contractors”. They are allowed to take their profits out of the loans. That covers any amount put in for a “down payment” and they are in for free. They are allowed the standard 20% “builder’s profit & overhead”, if the renovation costs double the original acquisition cost that is 40% of the original acquisition cost. If they keep it ten years, they are not required to repay the loan. They also form “management companies” and “taxable” profits almost disappear. Ain’t “government help” great?
If you are the right type (smooth of talk, but coarse of mind) you can do rather well with government programs which permit demolition and new construction.
Faust, you provide a compelling description of yet another arena in which government chokes off private sector initiative.
It takes a long time for the economy in a place like RI to die. Ambitious and talented people tend not to fight the corruption that is at the root of the problem. They just move to Texas, Arizona or other areas of the country where more opportunity is available. In a previous era, people came to RI for opportunities that were not available in Ireland, Italy or Poland.
OK fine. But what if our whole country goes in this dreadful direction? I guess some of our kids and grandkids can move elsewhere if it gets bad enough. But I hate to think of them as being future non-Americans. I think our democracy is strong enough to course correct but remains to be seen.
There is something in what you say, reminiscent of John Galt. Still, it is a big country with lots of places to go. Rhode Island has suffered severe decline before. One of the reasons that there are so many old buildings is what preservationists call “preservation by poverty. There simply wasn’t any economic engine at work that required demolition and construction. Sooner, or later, government subsidy will run out. At that point RI will sink further. Perhaps prices will get so low it will attract re-occupation. More likely, it will end up like Detroit. I am not gloating as I write this.
Those who grew up here are accustomed to it, and like it. But, as far as moving elsewhere, there are those who point out that if America had been settled West to East, New England would be a national park.
Many of my friends have moved to Idaho. It is not the militias that attracted them, it was the scenic beauty and the “freedom”.
Faust — I think you hit the nail on the head however depressing for a native of Providence to acknowledge. Loved the John Galt reference which necessitated a visit to Wikipedia. Ayn Rand warned of what is happening to RI currently.
I noticed that there hasn’t been a comment in over a week, so I thought I would add one. As I read through the comments I notice a common thread. When is the city going to do something? Why doesn’t the government force the banks to unload these properties? In short, when is someone else going to do something. Get real, they’re not.
Those out there with initiative have to help themselves. Perhaps a march on City Hall to press for changes that would aid those with initiative. Reconsideration of building codes which currently push renovation costs beyond reasonable limits. Wholesale tax takings which would result in auctions at actual value. These are never going to be “high rent” neighborhoods, costs, and therefore rents, have to be brought back in line with real values. It was the soaring “values” which lifted the required rents beyond the ability of likely tenants to pay. None of the three deckers shown could ever have produced the rents to service a $300,000 mortage and also provide any realistic amount of revenue for repair and maintenance.
Remember, falling “tax values” choke off the life blood of the city. They are not anxious to aid lower values. The days when they could assign $250,000 values to three deckers was a “high water mark” for them.
My last comment on what I would call the “Blue State” response of expecting the government to save us, leads me to another comment. In the past I have tried to use government programs in the renovation of older rental properties. What I found was, that in exchange for favorable financing, they wanted control of design and the use of “approved” contractors. Their idea of design was “barracks”, and the bids of the “approved” contractors were way out of line. I abandoned the idea and went ahead without them. I was able to do the projects at slightly more than 1/2 the sums bid and they do not look like barracks. When dealing with government people it has to be remembered that they are not “people who do” and they believe imitation is the sincerest form of flattery. It also allows them the excuse that “everyone else was doing it”. Didn’t their mothers ever say “if all of your friends were jumping off a bridge, would you do that too?”.
The programs work out rather well for projects undertaken, for their own account, by “approved contractors”. They are allowed to take their profits out of the loans. That covers any amount put in for a “down payment” and they are in for free. They are allowed the standard 20% “builder’s profit & overhead”, if the renovation costs double the original acquisition cost that is 40% of the original acquisition cost. If they keep it ten years, they are not required to repay the loan. They also form “management companies” and “taxable” profits almost disappear. Ain’t “government help” great?
If you are the right type (smooth of talk, but coarse of mind) you can do rather well with government programs which permit demolition and new construction.
Faust, you provide a compelling description of yet another arena in which government chokes off private sector initiative.
It takes a long time for the economy in a place like RI to die. Ambitious and talented people tend not to fight the corruption that is at the root of the problem. They just move to Texas, Arizona or other areas of the country where more opportunity is available. In a previous era, people came to RI for opportunities that were not available in Ireland, Italy or Poland.
OK fine. But what if our whole country goes in this dreadful direction? I guess some of our kids and grandkids can move elsewhere if it gets bad enough. But I hate to think of them as being future non-Americans. I think our democracy is strong enough to course correct but remains to be seen.
New Man,
There is something in what you say, reminiscent of John Galt. Still, it is a big country with lots of places to go. Rhode Island has suffered severe decline before. One of the reasons that there are so many old buildings is what preservationists call “preservation by poverty. There simply wasn’t any economic engine at work that required demolition and construction. Sooner, or later, government subsidy will run out. At that point RI will sink further. Perhaps prices will get so low it will attract re-occupation. More likely, it will end up like Detroit. I am not gloating as I write this.
Those who grew up here are accustomed to it, and like it. But, as far as moving elsewhere, there are those who point out that if America had been settled West to East, New England would be a national park.
Many of my friends have moved to Idaho. It is not the militias that attracted them, it was the scenic beauty and the “freedom”.
Должен Вам сказать Вас ввели в заблуждение….
No houses yet photographed. Take a picture if you find one.
No houses yet photographed. Take a picture if you find one…..
Faust — I think you hit the nail on the head however depressing for a native of Providence to acknowledge. Loved the John Galt reference which necessitated a visit to Wikipedia. Ayn Rand warned of what is happening to RI currently.