Affordable Housing Institute : US

“Holmes talks on housing in blogger malarkey
Quick witty sallies with captions so snarky
Long-winded essays about anything
These are a few of the AHI things”

 

Teachers are supposed to like all their pupils equally.  Parents will cut their hand off rather than admit they have a favored child.  Bloggers are likewise supposed to embrace all their posts, each in its own uniqueness. 

 

 

Your humble blogger, in Mavoko, Nairobi, Kenya

 

Still, we’re all human, and in the nearly three years I’ve been posting to this blog, there are some I particularly like.  Here are excerpts (but you should Read The Whole Thing in each one) from my favorites:

 

(What are your favorites?  Write a comment below!)

 

February, 2005: The four kinds of money:

 

Being the introduction of Sherlock Holmes, housing finance consultant:

 

“Four kinds of money, Holmes?  Four?”

 

“Yes, Watson, and each has a different sign.”

 

 

“Let me explain.”

 

 

Is this napkin large enough for four kinds of money?

 

In affordable housing, every financial transaction involves a capital producer (who gives money) to a capital consumer (who needs money).  In investment terms, money may be either debt or equity:

 

Debt: money rented for a time interval on specified terms: interest rate, term for repayment, regular repayments, priority of repayment, security.

Equity: money that buys ownership: it is a permanent trade where the equity investor acquires a share in the venture, whose value depends on future events.

 

In the US, for instance, we have or have had numerous forms of both soft debt and soft equity:

 

Soft debt: HOME, CDBG, mark-to-market soft second loans, Flexible Subsidy, accruing purchase money financing. 

Soft equity: Low Income Housing Tax Credits (LIHTCs), historic tax credits, New Markets Tax Credits, state tax credits, accelerated depreciation.

 

“But how do developers use them in their nefarious plans?”

 

“That, Watson, is quite a three-pipe problem ….”

 

 

May, 2005: Slums are economically rational:

 

The private sector has a straightforward and economically rational solution to the problem of unsustainable renters, consisting of the following steps:

 

·         Compress rentable space each unsustainable renter occupies.  This has the effect of increasing the revenue per unit.

·         Reduce operating expenses to a bare minimum.  This results in an accelerating cycle.  Inadequate operating expenses lead to deferred maintenance and a decline in property physical condition.  Declining property condition leads to lower curb appeal, difficulty attracting good tenants, which leads to acceptance of marginal tenants.   Accepting marginal tenants leads to higher collection/ bad debt losses, higher maintenance, secondary problems (e.g. vandalism), which leads to higher-income tenants move out.  Loss of market tenants leads to lack of rentability leads to stigmatization of the property.

·         Adverse-select the worst location because these have the lowest acquisitions/ operating costs and the tenancy residing in them has the fewest alternatives and the least economic imperative for (as an example) transportation and public services.

 

The long-term end result, of course, is a slum, and it is economically significant that exactly the same slum-creation economics recur in cities going back two thousand years. 

 

Slums will inevitably come into being unless government intervenes in otherwise ‘normal’ market practices.

 

June, 2005: Government is a factory:

 

Which branch is the legislative again?

 

… that manufactures only two products:

 

·         Laws.  Rules, regulations, boundaries, and typically variations of thou shalt not.

·         Money.  Programs, subsidies, incentives, variations of we will pay you if.

 

(Hot air, which government produces in bulk, is merely an accidental byproduct.)

 

June, 2005: The Law of the Observant Herd:

 

Back in the fourth century, a major theological debate erupted between two schools of thought about man’s nature: was man fundamentally good, or was he fundamentally a sinner?

 

God give me chastity, but not yet

 

Followers of St. Augustine (354-426) argued that since we are all children of Adam’s fall, we are all sinners from inception.  As such, we must be presumed evil unless guided by a firm set of moral scriptures.

 

If we’re so innocent, why are we fig-leaved?

 

Against that, the British monk Pelagius (?-430?) proposed that man is basically good (needing no divine intervention) –

 

Pelagius, died 430?

 

– and if left to his own devices will find the right way. 

 

Theological scholars, please do not brickbat me — the above is a crude paraphrase of impassioned learning far too complex for my poor sinner’s brain and far too lengthy to quote here.

 

The feud between Augustinians and Pelagians carries throughout history.  Pelagian principles found an entirely different expression in Jean-Jacques Rousseau (1712-1778) thirteen hundred years later (”man is born free and everywhere he is in chains”).  Closer to home, Goofus and Gallant, those archetypes of dentists’ offices, fought out monthly highlights with suitably uplifting resolutions.

 

Well, Augustine and Pelagius can rest easy in their graves or heavens, for I have found the synthesis of their dialectic. 

 

“Hey, dialectic sounds Marxist or Hegelian!”

 

I call it the Law of the Observant Herd.

 

“We’re very observant!”

 

November, 2005: L’horloge Orange:

 

After the Paris riots, what’s it going to be then?

 

Where I lived was with my dadda and mum in the flats of Municipal Flatblock 18A, between Kingsley Avenue and Wilsonsway.  I got to the big main door with no trouble, through I did pass one young malchick sprawling and creeching and moaning in the gutter, all cut about lovely, and saw in the lamplight also streaks of blood here and there like signatures, my brothers, of the night’s fillying.  And I too saw just by 18A a pair of devotchka’s neezhnies doubtless rudely wrenched off in the heat of the moment, O my brothers.  And so in.

 

Paris, riot cop, high-rise in La Blanc Mesnil

 

In the hallway was the good old municipal painting on the walls — vecks and ptitsas very well developed, stern in the dignity of labour, at workbench and machine with not one stitch of platties on their well-developed plots.  But of course some of the malchicks living in 18A had, as was to be expected, embellished and decorated the said big painting with handy pencil and ballpoint, adding hair and stiff rods and dirty ballooning slovos out of the dignified rots of these nagoy (bare, that is) cheenas and vecks.  I went to the lift, but there was no need to press the electric knopka to see if it was working or not, because it had been tolchocked real horrorshow this night, the metal doors all buckled, some feat of rare strength indeed, so I had to walk the ten floors up.

Anthony Burgess, A Clockwork Orange, 1962, page 35

 

 

Riots continue to plague urban France:

 

AUBERVILLIERS, France — Marauding youths torched nearly 900 vehicles, stoned paramedics and burned a nursery school in a ninth night of violence that spread from Paris suburbs to towns around France, police said Saturday. Authorities arrested more than 250 people overnight — a sweep unprecedented since the unrest began.

 

[Continued tomorrow in Part 2.]

Send post as PDF to