Why is affordable housing, and homeownership so challenging on Long Island? Is it predatory and discriminatory mortgage lending practices that stack the deck against Long Island home buyers, and homeowners? Or is it something else? One NY non-profit suggests that more counseling and easing lending rules is needed to help those struggling to buy a home on Long Island. Both of these things may be beneficial, yet there continue to be no and low down payment home loans available. The fed even held off on raising interest rates in September 2015, keeping the window of opportunity open for more buyers to take advantage of incredibly low fixed rate loans. And given the current competition between lenders it seems a little farfetched that they are engaging in widespread discrimination. They may be, but you’d think they’d be eager to make loans and take payments from anyone providing the money is green. According to Zillow the median home sale price in Suffolk County, Long Island was just $377,500 in July 2015, and dropping. Zillow forecasts show local housing is expected to remain an average of almost $100,000 cheaper than at the peak of 2006. At 4% interest, a 100% loan would run home buyers just $1,802.24 per month in principal and interest payments on average. That’s not too bad. So what’s the problem? There are three issues causing problems today:
- Fear of not qualifying for a home loan, which means many are not even trying
- Poor financial management skills
- High property taxes
Many more might soon be able to own homes on Long Island if they talked to a good mortgage adviser. However, enjoying homeownership is even more a matter of managing personal finances than just qualifying for a loan. As of mid-2015 Zillow reported over 20% of local still delinquent on mortgage payments. It really doesn’t matter if you qualify for a great interest rate and no money down financing if you’ve never been taught to balance a budget or your property taxes are out of control. Meanwhile Suffolk County executive Steve Bellone is proposing increasing police district taxes by almost 3% for next year. So taxes keep going up for those it hurts most while big real estate developers and the wealthy appear to continue to get sweetheart deals for luxury housing and investments. That’s not their fault, and everyone should take advantage of the tax breaks they are offered. However, NY property taxes continue to be a highly controversial issue. If you ran a business that systematically overbilled customers for just two or three years you’d at least get shut down, if not end up in jail. Yet, this is admittedly what is happening with property tax bills each and every year. Almost half of the bills sent out are wrong. And it is those already struggling to maintain that are hit the worst. Some might argue this is the worst example of predatory housing policies in the nation today. Yet, it remains up to the individual home buyer and homeowner to challenge those taxes. There is absolutely no question that affordable housing does remain an issue throughout New York. However, there is a significant portion of the population that could afford homes on Long Island, and could more comfortably be able to keep them if they got help in pushing back against incorrect property tax bills. So talk to a mortgage professional and find out if you can qualify to buy a home, or reduce your interest rate on an existing loan. Then talk to a local Suffolk County property tax adjuster to slash those tax bills and make your home even more affordable.