Economy and Real Estate

In response to "Our Cities Won't Heal Until Real Estate Heals," Commentary, July 7:

James Didion blames "flawed national policies" for our current real estate crises and then looks to the federal government to help move California's economy toward "stability, recovery and growth." Actually, we needn't look further than the California electorate for our current woes. When the voters approved Proposition 13 they condemned our cities, leaving them far short of funds for the infrastructure that keeps society running. So, the cities began charging fees to developers, who passed the fees on to buyers, which drove up the price of homes and the value of real estate.

Didion speaks of the $20,000 to $40,000 in fees paid on each new home as if it were mother's milk. It may well be--in the eyes of the cities--but there's a downside to it all. So many fees have been placed upon those wanting to buy homes that they are no longer able to buy a home. If you move to the Midwest you can buy a home for about the cost you pay in Southern California for the fees alone. No wonder both our population and our businesses are fed up and moving. It's an unfair system but the cities aren't to blame, the voters are.

"What's to be done?" Didion laments. Let's start with being honest with ourselves. A large group of voters found a way to exempt themselves from paying into the local tax system like they were some kind of sacred cows. We need to return to the system wherein property values are established by the marketplace and every person is required to pay his fair share of the taxes due on their "wealth." Only then will we see some of those 190,000 real estate-related jobs return and only then will we see an improvement in our schools, roads and other public services.

KERRY SMITH

Newport Beach

* It is just amazing to listen to all the talk by the politicians wanting us to believe they are going to get our economy back on track, yet they have done nothing to change the tax laws to ensure it does! If the real estate industry is the backbone of our recovery, then why is there no real help from our legislators?

I'm sure it's no surprise the real estate and building industries are profit-motivated businesses. If the incentive for profit is removed, then we have no industry. How about we restructure the laws to lower the capital gains tax, get the cities and counties out of the developers' way and keep the federal government out of the lending business.

We keep the elected officials in Sacramento and Washington who are responsible for the present business climate in California. We need some positive economic policies now!

BRUCE G. BUTLER

Real Estate Broker

Big Bear Lake

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