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Should cities dictate minimum home size requirements? Main Meridian Homes for Sale

 As many families are going back to basics and doing without excess expenditures, maybe it is time to take an honest look at cities requiring minimum sq. ft. requirements for new homes and minimum requirements for open space, etc.

Look at some of the older homes in the north end that people love and yet we can't build them today!  Even though I have not seen it in print anywhere, it is almost an unwritten law that if a developer tries to get a plat approved in Meridian that allows single family homes under 1,400 sq. ft. it won't get approved.  I remember when I first started with new home sales, they had plats allowing 900 sq. ft., then it moved to 1,000 to 1,100, etc.

Cities have increased landscaping requirements, open space requirements, larger lot sizes, etc. to the point that the developement fees and costs alone amount to about $35,000 in Ada County per lot!

Since I don't see that changing any time soon, it may be time for more condo plats consisting of entry level homes.  We don't really need any more high rise view condos downtown right now.  

Should the cities be the ones to decide if you have vinyl siding or not?  Should they dictate if the home is astetically correct or not?  Should they be able to say that only people that can afford a certain size home should be allowed to build a new home in their jurisdiction?  

I say absolutely not!  I am a firm believer in a fair market economy and know if people can afford something nicer, they will seek it out.  However, if they have to move to Melba or Middleton because they can't afford it here in Ada County and yet they drive to work tying up the interstate paying the money they saved on their homes on gasoline and vehicle upkeep and maintenance, did anyone really win?

What would have happened if the person that was allowed to build the one bedroom home I used to own while attending Boise State University wasn't allowed to have built it?  Would I have had to consider going to school somewhere else because I couldn't afford to live here?  Instead, that modest home allowed me a place to start and since then I have upgraded several times into my current home and rentals myself.

 

Jim Paulson, CRS, GRI - Owner / Broker - Progressive Realty Corporation

www.IdahoMLStours.com

 
Posted by Jim Paulson at 3/23/2009 3:35:00 AM
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Comments (1)
Re:Should cities dictate minimum home size requirements?
Jim,

I am also a firm believer in a fair market economy. But I believe the question that should be asked and answered honestly is not ?Should cities dictate minimum home size requirements?? but ?Why do cities mandate minimum home size requirements for new homes, increased landscaping requirements, increased open space requirements, larger lot sizes, etc.?

Everyone knows that property taxes provide local governments with the funds to provide needed services like police and fire protection, emergency medical, schools, and roadway maintenance. The size of the home does not significantly impact the cost to local government of providing these services. The cost is essentially the same regardless of the size of the home, the landscaping, or the lot size.

But in 1979, the Idaho State Legislature passed legislation that created the homeowner?s exemption for owner-occupied homes. The original intent of the homeowner?s exemption was to shift more of the property tax burden to businesses and investors. For the 2008 property taxes, this law exempts 50% of the value up to a maximum of $100,938 for the home and up to one acre of land. For the 2009 property taxes, the percentage reduction is unchanged (50%), but the exemption can reduce taxable value up to a maximum of $104,471 for the home and up to one acre of land. But the homeowner?s exemption is actually detrimental to the development of affordable housing.

According to the Department of Housing and Urban Development (HUD), the estimated median family income in the Boise-Nampa Idaho MSA in 2008 was $60,900. Also according to HUD, $205,000 is the maximum price home a family earning the median family income can afford using an FHA regular 30 year fixed rate mortgage with the minimum down payment. Assuming a price per square foot of $150, that $205,000 would buy a 1,367 sq.ft. home.

That $205,000 1,367 sq.ft home in 2008 had a taxable value of $104,062 ($205,000 - $100,938). If cities can mandate a minimum home size of 2,000 square feet and assuming that same $150 per square foot figure, that 2,000 square foot home would have a taxable value of $199.062. (2,000 sq.ft. x $150 = $300,000 - $100,938 = $199,062). That represents a 91% increase in the taxable value which equates to a 91% increase in property tax revenue to the city. Cities can significantly increase their tax revenue by taking actions that effectively increase the cost of new homes, like mandating minimum home sizes or larger lot sizes.

The state legislature in an effort to provide tax relief to homeowners has increased the homeowner?s exemption every year for the last four years. If you were an elected city official charged with finding a to raise tax revenues, would you raise the levy rates on every homeowner in your jurisdiction or would you look for another more politically safe way to do so, like increasing the cost of new the new homes being built?

In the interest of promoting more affordable housing, I would like to see some honest and open debate on eliminating the homeowner?s exemption and reducing the levy rates to keep property taxes at there current levels.

Chuck Miller GMB CGB CGP MIRM CMP MCSP CSP
President / Builder ? Chuck Miller Construction Inc.
(208) 229-2553
[email protected]
Posted by on 3/26/2009 5:58 PM
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Michelle Penick, Boise Idaho Real Estate Agent

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