Freakonomics Blog pointed me to an interesting story on affordable housing on Boston.com today.
Harvard Professor Edward Glaeser in Boston.com delves into problems with Massachusett's affordable housing law Chapter 40B. A number of builders have used somewhat less than legal means to get around the law's requirements while still reaping it's benefits. Glaeser argues that builder incentives should be in the removing profit caps on such projects and instead instituting a flat fee per non "affordable" unit produced under Chapter 40B. According to Glaeser,"A flat fee for each non affordable unit would give builders incentives to make their units more attractive, so that they rent or sell easier. A profit cap hampers builders' ability to earn more by improvements."
Adjusting incentives is something we often are doing here on ActiveRain (although it's likely a little easier for us). This same type of idea might be applied in a lot of areas where affordable housing is needed. Incentives instituted incorrectly can easily lead to less than optimal results.
That's funny Maggie. I don't know how often thoughts like that cross my mind when I see listings with various incentive programs. A buyer bonus? What are they talking about?