It has become fashionable among certain unfashionably conservative circles to blame the whole mortgage crisis on the urge to provide more Americans access to affordable housing. Sort of the counteroffensive against pundits decrying predatory lenders, the critic shifts the blame toward government policies aimed at making more people homeowners. The resulting loosening of lending standards, according to the theory, was more or less foisted upon lenders by a meddling government.
As is usual in most of these finger-pointing fights, there's plenty of blame to go around. The market will find ways to maximize profit and, all too often, it's otherwise well-intended government policies that provide the loophole. After all, the lenders didn't mind the lower standards much, so long as they could repackage the paper and sell off the so-called "mortgage-backed" securities (which, as many investors have recently been shocked to discover, can depreciate faster than a tract house in Florida).
But, when it comes to critiquing the mortgage mess from an "affordable housing" angle, I'm not sure that the critics dig deep enough. Used to be, numerous traditional housing types gave lower-income folks—many of them immigrants—the chance to own their own home. From the double-houses of Milwaukee, Philadelphia, and Cincinnati to the venerable Boston triple-decker, these owner-occupied, multi-family dwellings provided low-cost housing in the new world, built wealth, and ultimately transformed their occupants into assimilated Americans.
And, just as modern technology was beginning to address issues like sanitation and ventilation, single-use zoning and density and lot-coverage laws made many of these affordable housing solutions more or less illegal. The push towards single-use zoning, pioneered by the Cleveland suburb of Euclid in 1922, is mostly framed as an attempt to keep out industry. But the potential of zoning to keep pesky immigrant factory workers in their place was often seen as an added bonus in the reactionary environment of the 1920s. As a result, it's tough for moderate-income Americans to own their own home without relying on government assistance. The loosened lending restrictions, like the Mortgage Interest Deduction, merely make the subsidy less obvious.
I say if you want to subsidize your housing, try the old-fashioned way. Take this place on Emoriland. Built in 1935, it's a handsome home on one of North Knoxville's most desirable streets. But, as a side-by-side duplex whose recently restored units each rent for $900 a month, you could easily live in half and let the tenant next door pay most of your mortgage. Since both recently restored units feature refinished hardwood floors, tons of original trim and original Arts and Crafts style fireplaces updated with gas logs, the trickiest part of this deal may be deciding which side you want to call home.
2028 Emoriland Blvd.
2,772 sq. ft.
2 Units: each 2 bdrm, 2 & ½ bath
Contact: Scott Hendrix
Century 21: 531-2121