San Francisco Home Prices Fell for the First Time in Four Years in March

Post by rconti » Fri, Apr 15, 2016, 6:48 PM UTC

jseliger wrote: post #30

KKKKkkkk1 wrote: post #18

Earlier quoted context omitted.

As a foreigner, I don't understand this attitude. Why would you want all your wealth to be invested in a single leveraged asset that's also depreciating, requires your constant attention and ties you to a single locale?

1. People don't understand the time value of money, or how the alternative to owning a house is owning stocks / bonds. 2. Buying a house is a form of forced savings. This can be useful because people are irrational, per Kahneman's Thinking, Fast and Slow . 3. Cultural brainwashing (I think this is the biggest factor).

Post by fludlight » Fri, Apr 15, 2016, 6:50 PM UTC

Flammy wrote: post #120

ChuckMcM wrote: post #115

Reaffirming once again that if "nobody can afford to buy them" the actual prices start coming down. A more interesting thing for me however was that owner occupied (which is to say the person buying the house lives there) has not been growing[1]. Instead third parties are buying the houses as investments and renting them. That is a really risky strategy in a place like SF with rent controls as the floor can fall out…

A significant number are bought as investments, but NOT rented out, making the housing situation worse. Investors from more volatile economies (China) really see a few % up or down as incredibly stable compared to their native currency fluctuations.

Post by [deleted] » Fri, Apr 15, 2016, 6:56 PM UTC

dgemm wrote: post #75

adventured wrote: post #53

Earlier quoted context omitted.

Pretty incredible bubble price increases, given the growth rate of the Canadian economy. How can that end any other way but in a massive crash? "The average price of a Canadian home hit $508,567 in March, a jump of 15.7 per cent compared to the same month a year earlier." vs "IMF downgrades forecast for Canada's economy in 2016 and 2017" "Canada's GDP will expand by 1.5 per cent this year and by 1.9 per cent next yea…

Most markets in Canada are in slow decline, which reflects reality. Then you have the two special markets of Vancouver, which needs no introduction, and Toronto, which fits somewhere between Vancouver and reality. It would be interesting to examine the fundamentals of each separately.

Post by nugget » Fri, Apr 15, 2016, 7:01 PM UTC

andersen1488 wrote: post #162

kspaans wrote: post #139

Earlier quoted context omitted.

Remember that rent control only applies to buildings built before 1978, so it's not _all_ rent controlled.

It's scary to think that in 20-30 years nearly the entire available housing stock will not be covered by rent control. My landlord wanted to raise my rent 40% in one year here in Oakland until I pointed out the laws. Eventually the entire middle class will just be landless peasants again, allowed to live wherever the rich say that they can.

Post by the_economist » Fri, Apr 15, 2016, 7:05 PM UTC

tormeh wrote: post #159

gigawhat wrote: post #146

Weirdly, I own a house and think I'd be better off if prices fell-- fell a lot. I bought a few years ago and would be happy if prices uniformly dropped to those levels. Why? I want a 50% bigger/nicer house in the same area. But bigger/nicer houses have increased in price proportionally to mine. So the gap in absolute dollars between what I have and what I want has expanded quite a bit. My income has increased, but no…

The more expensive a property is, the less its price falls in bad times. Rich people are rarely forced to sell. It's a different market basically disconnected from the rest. I don't know what kind of house you want, but there's a nonlinearity there that might be important.