Honolulu City Council Weighs Empty House Tax

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Honolulu City Council members are looking to Vancouver

Canada, as a potential model for their own empty homes tax, aiming to combat a growing housing crisis in Honolulu. Similar to Vancouver’s approach, which began in 2017, the proposed tax in Honolulu would target vacant properties, starting at 1% of assessed value and increasing to 3%.

Vancouver’s tax has successfully reduced the number of vacant homes—from 1.36% in 2017 to just 0.58% in 2022—while generating significant revenue for affordable housing initiatives. However, critics in Honolulu express concerns over enforcement costs and how tax revenue would be allocated in Honolulu.

Council members in Honolulu are currently debating the bill, which restricts administrative costs to 5% and mandates that at least half of the funds support affordable housing and homelessness programs in Honolulu.

Vancouver’s experience highlights the importance of balancing revenue generation with effective enforcement. As Honolulu moves forward, the council in Honolulu aims to finalize the proposal by December, with the tax potentially taking effect in Honolulu by mid-2026.

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Down Payment Assistance Programs Surge Nationwide

Down payment assistance programs are on the rise, with an average benefit of $17,000, as states ramp up efforts to support first-time homebuyers. According to the latest Homeownership Program Index from Down Payment Resource, 29 new programs were added in the third quarter of 2024, marking an 8% increase from last year and bringing the total to 2,444 nationwide.

California leads the way with the highest number of programs and funding options available, while initiatives aimed at first-generation homebuyers have grown by 5%. The report also highlights an increase in below-market-rate homes, which are sold with deed restrictions for more affordable prices.

In addition, grant-funded programs grew by 7%, with municipalities providing the bulk of the funding at 39%. Notably, options for buyers of multi-unit properties have expanded as well.

As we approach the end of the year, the election season’s impact on housing policies remains to be seen. Presidential candidate Kamala Harris has proposed significant measures, including $25,000 in down payment assistance for first-time buyers.

Rob Chrane, CEO of Down Payment Resource, emphasizes that these growing programs offer targeted help for those struggling to enter the housing market.

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Wells Fargo Wins Appeal in $500M Lawsuit

And finally, Wells Fargo Securities has successfully defeated an appeal from investors seeking to revive their lawsuit over a staggering $500 million in losses from a 2018 portfolio liquidation. The investors, Todd and Joseph Kafka, alleged that Wells Fargo, acting as a futures commission merchant for LJM Investment Fund, forced the liquidation during a period of temporary market volatility.

However, the US Court of Appeals for the Second Circuit upheld a prior dismissal by the Southern District of New York, stating that the allegations did not substantiate claims of negligence or interference with contract relations. The court noted that Wells Fargo’s obligations were primarily to LJM, not directly to the investors.

The Kafkas claimed that Wells Fargo acted in its own interests rather than those of the investors, resulting in losses of between $500 and $800 million. But the court ruled that the Kafkas failed to demonstrate any duty owed to them by Wells Fargo, emphasizing that imposing such a duty would create an unmanageable liability for the firm.

This ruling follows other legal challenges faced by LJM and its managers regarding alleged misrepresentations to investors about their trading strategies, with estimated losses from those cases exceeding $1 billion.

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