Housing problem needs an incentive based solution
I read the article on Sunday, Dec. 12 (Town Hall Addresses Causes, Solutions For Homelessness) and had to stop and think about what it is that Montana is NOT doing to help solve this growing problem.
The worker shortage and housing crisis are both linked together. It’s a vicious cycle. The high cost of housing makes making a living wage in places like Flathead county unattainable.
Why doesn’t Montana, on a state or county level, form a cooperative partnership with citizens who work, spend and pay taxes here? What helps the most needy at the bottom lifts us all up as a community of Montanans. Montanans are incredibly hard working and generous people. I think we have all seen this first hand in action and so the solution is being able to tap into this generosity in a way that makes a difference to being able to have a savings account or safety net, when you are needing to pay the rent, mortgage or make an offer on a home.
I believe the state of Alaska shares its oil revenues with citizens with payouts each year to its citizens. Something like this is doable here and way overdue.
Every Montana taxpayer should have a home equity account set up based on income. Payments would be deposited into your account based on employment in Montana or business taxes. Montana does some things right by helping offset rising real estate taxes based on income. That said, there are any number of places the funding can come from for such a program.
Businesses can donate, it could come partially from resort taxes, since these are the towns like Whitefish that are becoming unsustainable. Money could come from a tax on breweries or recreational marijuana dispensaries. But I believe the lion’s share of funding can come from a one-time baseline real estate transaction fee on high-end homes. This could be a negotiated percentage of both the seller and buyers share on the buy-sell listing agreement, like closing costs. The seller could also agree to contribute MORE to this cause as a capital gains tax write off. The housing problem needs an incentive based on cause and effect solution to fix what the industry is NOT doing to balance the inequity in the market. It’s not going to fix itself.
Let’s face it. The reason people are priced out of the market here is because of the flood of cash buyers moving in. A million dollar home is just an average home in a resort town anymore. People moving here think nothing of buying a $4 or $5 million home, driving up prices for residence and putting inflationary pressure on basic goods and services. This is not going to change and will only get worse as time goes by.
Does anyone NEED a $5 million home on a ski mountain? No, but lots of people want one and are willing to pay for it. We should not be taxing Montanans on what they need to survive as much as taxing people on what they dont need to survive when they arrive in Montana. Any housing transaction above $4 or $5 million should have an equity fee placed on it as a percentage and that amount is deposited into an interest bearing Montana Equity Housing Fund account. As housing prices go up, and they always do, the amount deposited per transaction into the MEHFA increases, even if it is capped at a percentage of the total amount.
This fund could be accessed by first time home buyers, someone needing to make a rental deposit or who is out of work through no fault of their own and is behind on the mortgage. This is a creative solution that people would consider fair by any standard.
If you are being permanently locked out of the dream of homeownership with each passing day, why shouldn’t there be a solution on a state level that helps level the playing field for families and first time homebuyers struggling to live here?
What helps Montana helps Montanans in their pursuit of life, liberty and happy home ownership.
Robert Seymour lives in Kalispell