I can’t even begin to count the ways that this proposal is so… so… stupid! A Massachusetts politician wants to offer college graduates a subsidy to stay in Massachusetts for five years.
State Senator Brian A. Joyce, a Milton Democrat, this month filed legislation that would provide any graduate of a Bay State college $10,000 for a down payment on a house or condo. Joyce hopes the payment would soften the blow from the high cost of living and might persuade some graduates to stay and raise families here.
First, is the typical college graduate even thinking about buying a house or condo upon graduation? The median single-family home price in 2005 in a typical Boston suburb like Salem was $345,000. A condo was $271,000. Using a simple mortgage calculator, the monthly payment for a 30-year fixed-rate mortgage (5.75%) on that $345,000 house with a $10,000 payment would be about $2,000. For the condo it would be about $1,500.
According to accepted mortgage-lending standards, the debt-to-income ratio says that in order to afford a $2,000 per month mortgage, the buyer needs to have an income of $85,714. That’s just for the mortgage; taking into account all other bills, the rest of your monthly debt obligation (car payment, student loans, food, clothing, etc.) can exceed no more than an additional $571 per month.
Corruption, pandering, hackery
Technorati Tags:cost of living, housing, Joyce, Massachusetts, mortgage, politics, subsidy
True, it’ stupid. And I am positive that here in Illinois, our politicians can top any stupid propositions of those in Massachusetts. However, Massachusetts is losing its population to other areas of the country. The expense, like that of the Chicago metro area, is too much for young couples to deal with, especially those that plan on having children. Our young couples must move 60+ miles away from Chicago to near the Wisconsin state line just to buy a prefab house in a tract suburb on an old—and soon-to-be sorely missed—farmer’s field.
Funny how they never pause to think why the cost of living is so high there compared to other states.
I found it rather funny when I recently read Robert Hugh Benson’s “Dawn of All” written almost a hundred years ago of an imagined future where Boston becomes an enclave for socialists, atheists, and agnostics.
My husband gets paid very well in the range you spoke of but we’ve been out of school for seven years now. We did the math all we could afford was a mortgage below 200k.
Rather then doing things to encoruage business and encourage building homes people could afford we really need, their only answer is welfare.
Also for many college grads, turn over is high in their first, second, and third jobs. There is little retention and employers are unwilling to train or mentor. Grads don’t want to buy a home unless they know they will be in the company/field long term. Buying a home too soon after college, might selling the home at a financial lost if laid off (first hired, first fired) or being single and not married are more likely to transfer due to mobility.
How can one value the stability of family and the healthy raising of children ina state when there is no name for the institution that holds that fabric togeher…. ahem.
Maybe the students will use the $10K to pay off the stupid college loan that our politicians think is a solution to paying for college.
In Mass., as well as my home state New York, there is a real brain drain going on. The states shell out billions to educate students from kindergarten through college, yet at the end of the day we have to leave the state to find a good job.
The MA and NY politicians should focus on the policies that are driving companies and, therefore, jobs and young people out of state.
More pie in the sky liberalism at tax payers expense. The most dangerous thing in the world is when the Massachusetts State Legislature sits in session on making a new law for the poor sheeple out there! St. Paul said so clearly: “If you don’t work, you don’t eat. Do not sit around thinking of ways to interefere in other people’s work!” State Senator Bryan A. Joyce needs to go back to Scripture 101 and learn his orthodox faith and scriptures.
http://www.theorthodoxromancatholic.com
Indiana has something similar, except that it is privately funded by an endowment (which, I believe, the individual university can direct as they wish to try to keep grads in-state, but Notre Dame uses the money for such a program). It is considered an income supplement, designed to go towards paying off loans and other such things that a recent college graduate would actually do (unlike buying a house). And it’s also something for which one has to apply and be selected, not just “any graduate.”
Which is to say, it’s a program that actually makes sense and doesn’t cost any taxpayer money.