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Show ,? f Page mmmmmrn i-- j A The Enterprise Review , September 29, 1976 i FNMA Yields Decline Investment Summary Auction yields declined the Federal National CzzcA Akerlow as Mortgage Association issued $156.7 million in cultural use. Development Rights presuppose that a market will be found for the land in its new form within a specified period of time. If the market does not materialize, does the developer have a right of action against the Or if the market state? materializes ahead of the exercise of the developers right to develop, would not the developer have some course of action against the state? with The trouble Steve Jensen, an urban planner with the Salt Lake County Water Quality Study Team, advanced the idea that developers should chase from development agricultural pur- rights land owners in order to provide for orderly 'development of the county land resources. In this publication last week Jensen pointed to a plan developed by Suffolk County in which the taxpayers purchased development rights from agricultural land owners and then sold those rights to developers as the ground became ready for development. This idea is supposed to provide some equity in the value of agricultural land versus residential land. As Jensen pointed out, since it takes 18 times more land to feed people than it does to give them space to work, live and move, agricultural land is of less value than other land. While 1 agree with his conclusions, I am puzzled about how his proposal of purchasing development rights Would solve the problem. If a developer purchases development rights, the question becomes when may he develop the property. If the government tells him that he may not develop it for five years then the development rights should be worth less than land which he might develop in two years. The end result however is the same. The land transfers from an agricultural use to a residential or other use. Jensen tells us that we still need , land for agricultural purposes so I am puzzled as to how his plan would keep land in agricultural use in order to maintain that 18 to 1 ratio. The other problems with Jensen's proposal relate to the mechanics of development rights. He suggests that along with them comes automatic rezoning. Automatic rezoning poses a problem for the tax collector since the land is zoned for residential purposes but is in agri Jensen's notion is that it attempts to put a straitjacket on the market place. There is a popular notion among urban planners to criticize the intent of developers and to be sure some developers have been able to bring poor product into the marketplace at the wrong time. So these projects have caused local government a great economic burden. But on the whole I have not seen any developments built in Salt Lake County which have been ahead of the market. In fact, developers provide great value to agricultural ground because of their ability to convert it to residential use. They did not need development rights or other government interference to do this. Similarly, I have seen developers turned down by local government planning bodies when they have attempted to rezone agricultural land to residential which was either ahead of the market or too far removed from utilities or both. When that happens, then it appears clear that the agricultural ground in question is not worth anything more than what four-mont- commitments to both government-backe- d h purchase and conventionally financed home mortgages. The corporation issued million $49.1 in commi- on government-backe- d mortgages at an average yield of 8.841 , which tments converts to an average price of 97.61 for 8 12 FHAVA mortgages. (The average in the previous auction was The range of 8.921.) ac- cepted bids yesterday was 8.813 (97.80) to 8.930 (97.00). FNMA received 182 FHAVA bids totaling $99.1 million and accepted 148 bids, including 107 noncompetitive. In the conventional auc Realtors Note Sales; Home Market Volatile Four weeks of September showed a volatile market for homes as the average price fluctuated widely (see chart). Total real estate sales for the week ending September totaled 24, 3 $8,497,541, up percent over the previous week. The Salt Lake Board of Realtors reported 184 homes were sold for $7,196,119. Three multiple unit dwellings were sold for $138,500. Two business and industrial properties $650,000. were sold for Average Sale Price of Homes Salt Lake September 42.0 n 41.5 41.0 40.5 40.0 10 17 24 Week Ending Source: Salt Lake Board of 3 Realtors. i j tion, FNMA issued $107.6 h million in com mitments at an average yield of 9.094, down from 9.125 on four-mont- I The range of accepted bids was from 9.071 to 9.126. FNMA received 204 conventional bids totalSeptember 7. ing $151.1 million and I ac- cepted 161 bids, including 59 noncompetitive. The next auction will be October 4, 1976. 1 i Skateboards Slated for Production Ronald L. Molen, well known Salt Lake architect, and his son, Mark, plan to begin production of a revolutionary new skateboard by January. Thousand $ :) The Molens, i -- i ri i a founders of Airboard, Inc., say they will test market 5,000 of the new boards in Utah and California. Mark Molen, who built and designed the new skatestill board, said they are testing various prototypes to determine which model will be the strongest. With this model, the rider is held fast to the board by bindings around his feet. Its much like skiing sideways on one ski, Molen said. i i ? t 1 MORTGAGE RATES FHA 8.5 Lender Vi VA 8.5 FHAVA points conventional rate t S . i 1 ; i 1 1 agricultural ground would typically be valued since there is no market. A system of development rights imposes an arbitrary value on land today which may bear no resemblance to what the land is worth tomorrow. I doubt that any developer would negotiate development rights (which really amounts to an option on the ground) without stipulating what price will be eventually paid to the farmer. Very few developers have a large enough crystal ball to be able to predict with any certainty what agricultural land will be worth in five years. Frankly, I sec nothing wrong with our Having present system. dealt with many agricultural land owners I am confident that they would regard such a system as foolish. In the end the result would be essentially the same. f , These rates were obtained by telephone conversation with the above institutions. The rates are correct to the best of our knowledge but their accuracy cannot be guaranteed. Z I |