How did an entire state price itself out for entry-level home buyers? • Hacker News Board

Re: How did an entire state price itself out for entry-level home buyers?

#11

Post by xrange » Fri, Oct 21, 2016, 7:05 PM UTC

nugget wrote: post #3

The more prohibitively expensive California (and the Bay Area in particular) becomes, the better it is for the rest of the country - entrepreneurial talent has already started to relocate elsewhere, and I expect this trend to continue, perhaps even accelerate, in the future. There are advantages to having a single, super-dense concentration of business, marketing, and engineering talent but there are also (in my opin…

> the better it is for the rest of the country - entrepreneurial talent has already started to relocate elsewhere

It's only better if they move elsewhere and refuse to vote for the same policies that caused the problems in the first place.

Re: How did an entire state price itself out for entry-level home buyers?

#12

Post by Waterluvian » Fri, Oct 21, 2016, 7:06 PM UTC

nugget wrote: post #3

The more prohibitively expensive California (and the Bay Area in particular) becomes, the better it is for the rest of the country - entrepreneurial talent has already started to relocate elsewhere, and I expect this trend to continue, perhaps even accelerate, in the future. There are advantages to having a single, super-dense concentration of business, marketing, and engineering talent but there are also (in my opin…

I live near Waterloo, Canada. It feels very good for us as we have always struggled to convince people to come live in the snowy abyss rather than cozy California.

Re: How did an entire state price itself out for entry-level home buyers?

#13

Post by dangravell » Fri, Oct 21, 2016, 7:09 PM UTC

Anecdotal evidence from small scale builders suggest building to higher performance standards, even to Passivhaus, add only up to (sometimes no more than) 10℅ build cost.

It's all down to design, and this is where volume builders baulk. They can't pay minimum wage to cheapest labour to throw up 'standard' builds - in the UK that's cavity wall, but in the US no doubt you have your own standard approaches with performance problems.

Given that no house has ever been sold at a price based on build cost, the type of whining in the OP really boils down to "our profits are lower, can government do something about it?".

Re: How did an entire state price itself out for entry-level home buyers?

#14

Post by honkhonkpants » Fri, Oct 21, 2016, 7:11 PM UTC

lambdasquirrel wrote: post #7

On the flip side, does this state have enough water for the other 10-odd million people who'd be living in those 3.6 million homes?

The state has plenty of water for people to drink. It doesn't have enough water for all those people, and to irrigate a gigantic desert, at the same time.

Re: How did an entire state price itself out for entry-level home buyers?

#15

Post by landryraccoon » Fri, Oct 21, 2016, 7:12 PM UTC

aplomb wrote: post #9

Started out with an every-man appealing headline and quickly showed its stripes of being a developer funded prop 13 hit article - totally separate from the horror show environmental impact has turned into. The examples given are completely out of whack and strawmen. prop 13 allows for effective tax increase through reassessment of value, but that reassessment is capped so when the market goes crazy people aren't driv…

Prop 13 creates an incentive for homeowners to oppose development, since their housing values will rise with no drawback on property taxes. It also means that the government is forced to raise sales and income taxes in order to raise revenue. It is harmful for society to have high housing prices which falls especially on younger workers and workers moving into an area, in order to benefit a small number of incumbents.

No other good is treated like housing this way. We don't say it's good if your computer or cell phone goes up in price, or if cars are more expensive every year.

Re: How did an entire state price itself out for entry-level home buyers?

#16

Post by gsnedders » Fri, Oct 21, 2016, 7:13 PM UTC

twothamendment wrote: post #8

beamatronic wrote: post #2

This is a fascinating and shocking number: "Typical fees in San Francisco are $72,600 per home; in Sacramento, they’re $62,000. And for the six California markets highlighted in the Zelman & Associates report, the average is $51,650. "

I built a few homes in a new (didn't really exist in 1998) city in Utah. Fees were about $20,000. I thought that was high! Most of those fees went to the infrastructure that was put it so people had a lot to build on. Getting water power and gas out there isn't cheap and the city owned the power, water and gas utilities - so they had to pay the bonds with something. Since then I built in the middle of nowhere - no ci…

There's varying levels, though, when it comes to infrastructure—at an extreme end, you might need to expand the road network to deal with increased traffic, and if that's building a new, parallel road, or doubling an existing one, that can get pricy fast.

Of course, this is unlikely to affect anyone building a single property, but at least here if you're a developer building a large number of homes you can be expected to make a contribution towards to the cost of the infrastructure associated with the development.

Re: How did an entire state price itself out for entry-level home buyers?

#17

Post by joeldg » Fri, Oct 21, 2016, 7:13 PM UTC

aplomb wrote: post #9

Started out with an every-man appealing headline and quickly showed its stripes of being a developer funded prop 13 hit article - totally separate from the horror show environmental impact has turned into. The examples given are completely out of whack and strawmen. prop 13 allows for effective tax increase through reassessment of value, but that reassessment is capped so when the market goes crazy people aren't driv…

Exactly... if left unchecked entire communities would be engulfed by developers hungry to cash in on whatever market they decide to get into. Communities are barely able to fight them off as it is. I live in Venice and the locals are being all pushed out by illegal airbnb "hotels" taking over rent controlled buildings and every little lot suddenly having a three-story steel and glass monstrosity built on it right up the property lines.

Re: How did an entire state price itself out for entry-level home buyers?

#18

Post by nugget » Fri, Oct 21, 2016, 7:13 PM UTC

aplomb wrote: post #9

Started out with an every-man appealing headline and quickly showed its stripes of being a developer funded prop 13 hit article - totally separate from the horror show environmental impact has turned into. The examples given are completely out of whack and strawmen. prop 13 allows for effective tax increase through reassessment of value, but that reassessment is capped so when the market goes crazy people aren't driv…

Proposition 13 is a massive subsidy provided to real estate investors. If the goal is to prevent retirees from being ''driven out of their homes'' then there is no reason not to limit the exclusion to a single property per person.

Re: How did an entire state price itself out for entry-level home buyers?

#19

Post by toomuchtodo » Fri, Oct 21, 2016, 7:13 PM UTC

xrange wrote: post #11

nugget wrote: post #3

The more prohibitively expensive California (and the Bay Area in particular) becomes, the better it is for the rest of the country - entrepreneurial talent has already started to relocate elsewhere, and I expect this trend to continue, perhaps even accelerate, in the future. There are advantages to having a single, super-dense concentration of business, marketing, and engineering talent but there are also (in my opin…

> the better it is for the rest of the country - entrepreneurial talent has already started to relocate elsewhere It's only better if they move elsewhere and refuse to vote for the same policies that caused the problems in the first place.

The problem is, when you move somewhere else, and you buy your home, you become the person that wants their home value maintained/protected. Are you going to vote against your own interests? If so, I applaud you. Otherwise, you're just distributing the problem across the country, as tech money flows through workers in secondary cities (inflating property prices in Austin, Denver, Boulder, Nashville, Portland, Seattle, etc).

Re: How did an entire state price itself out for entry-level home buyers?

#20

Post by laurentoget » Fri, Oct 21, 2016, 7:13 PM UTC

I do not know much about real estate cost but it is interesting to see someone blaming a $50,000 regulatory fee for the $400,000 or so difference in median house cost between CA and other states.