Monday, October 19, 2015

How "Green Energy" Is Destroying California's Real Estate Market

by JASmius

What was it that Rocky Balboa said to that loan shark "client" way back in the first Rocky?  "You shoulda planned ahead."  Unfortunately for a large number of dumbass California "green energy" homeowners, they didn't take Rocky's advice, they made their houses more expensive to sell without actually adding any value to them, and now they can't unload them.

What was it he said to Adrian about Paulie in Rocky III?  "And they call me punchy":

More than fifty thousand California households have signed up for Property Assessed Clean Energy (PACE) financing since State legislators passed a law in 2008 allowing residents to borrow money for such things as solar panels and energy-efficient windows. The financing method, authorized by cities and counties, and funded by venture capital-backed startups like Renovate America Inc, Renew Financial LLC and Ygrene Energy Fund Inc, is then paid off through special assessments on property tax bills. [emphasis added]

Why didn't they all just call themselves "Solyndra" and be done with it?

You can see where this is headed, can't you?

Because the improvements stay with the home, and subsequent owners will reap the benefits of them, the assessments are intended to remain with the property in the event of a sale.

And, of course, there are no "benefits" to reap, just exorbitant additional costs to absorb, as is always the case with "green" anything.

And here comes the corresponding punchline:

But some homeowners trying to sell their houses have found potential buyers scared off by the higher tax assessments. And now realtors in the state are organizing against PACE, saying it makes getting new mortgages much tougher and can leave sellers stuck in their homes. [emphases added]

See, this is what happens when you don't think through all the implications of wasting money on solar panels that are effectively enviro-lawn ornaments - trust me, folks, a few pink flamingos would be much, much cheaper - and "energy-efficient windows" that cost far more than any de minimus amount you'll ever save on your electric bill (unless you live in your house until the dawn of the twenty-sixth century).  The funniest part is that the way this greenstremist nonsense is sold as an economic boon without the doggle, it's assumed that it adds value to the property, and boosts the assessed value, and makes everything about owning it more expensive without really adding any value to it at all.  Prospective buyers instinctively know this, and since "only" fifty thousand numbnuts fell for this PACE scam, there are plenty and more affordable "brown" houses to be had.

Thus does the same dynamic that makes "green energy" economically non-viable and in perpetual need of the government subsidies crutch contaminate the real estate business for all the suckers fool enough to fall for it.

If you're getting the impression that I have no sympathy or pity for those individuals, congratulations, you're paying attention.  I consider it an exercise in economic darwinism.  "A fool and his money are soon parted".

The way that non-fools are similarly parted?  You know how:

PACE obligations enjoy first-lien status in most States, making municipalities first in line to be repaid — ahead of the mortgage agencies, in case of default — and mortgage agencies don’t like that.

So today, the White House and the Federal Housing Administration (FHA) established a new PACE "guidance" aiming to “remove existing barriers and accelerate the use of PACE financing for single-family housing.” (The FHA guidance letter can be found here.)

According to the California Association of Realtors, the FHA guidance will require PACE liens to be subordinate to FHA single-family first-mortgage financing.

In other words, when these "green" homeowners default on their mortgages, they won't be on the hook for them, and the municipalities won't be on the hook for the unpaid gouged property taxes - thee and me, We the People, the taxpayers who never ever seem to pay enough to suit the Left, will be left to pick up the tab.

I bet you couldn't guess that this swindle is one of Barack Obama's favorites and that he's been flacking it incessantly all across the country, could you?  The least he could do for his victims is throw in a complimentary pink flamingo.

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