Tax Update Blog: Permalink

« Previous · Tax Update Blog Home · Next »

Meeting met needs

December 18, 2008

Recent Iowa news items that should be read together:

Des Moines area home sales fell 33 percent in Nov.
Des Moines area home sales fell 33.5 percent in November compared to a year ago, a report today shows.

The average sale price in November declined 1.2 percent — or $1,913 — to $164,946 compared November 2007, said the Des Moines Area Association of Realtors.

And:

Low-Income Housing Tax Credits to Provide Affordable Housing for Hundreds of Iowans

DES MOINES – Governor Chet Culver has announced that the Iowa Finance Authority (IFA) Board of Directors has approved over $180 million in federal Low-Income-Housing Tax Credits (LIHTC) to create and restore nearly 1,400 affordable housing units in Iowa.

"As Governor, I am committed to ensuring that every Iowan has access to quality, affordable, and safe housing,” said Governor Culver. “During these tough economic times, it is imperative that state government do what it can to help those who need a place to live. With these tax credits, we are helping to turn our goal into a reality and giving thousands of Iowans a place to call home.”

Home prices are declining; some economists say that the economy can't recover until home prices stabilize. Yet the government pork machine runs on autopilot, continuing to subsidize new construction, increasing the supply of homes and further depressing prices. Like so many government solutions, these credits are solving a "problem" that has gone away while making a real problem worse.

Tags: corporate welfare.tax policy.