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A Growing Problem in Real Estate: Too Many Too Big Houses

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Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#81

Post by dsfyu404ed »

woofie11 wrote: post #47
bilbo0s wrote: post #36

Earlier quoted context omitted.

Yep. Functions as it should. It almost seems like a majority of people expect that the nature of supply and demand should not apply to real estate.

Which is a fair expectation to have. Free markets are nearly optimal for commodities, restaurants, and similar sorts of goods, as well as many competing small businesses. They grind along for IP, utilities, and some sectors of education, as well as large businesses. They break down almost completely for large-scale finance, real estate, medicine, and other sectors of education. Curiously, much of this was predicted b…

>They break down almost completely for large-scale finance, real estate, medicine, and other sectors of education.

You just rattled off a list of sectors where the free market is the least free (though in the case of finance I think they more than earned it).

Of the four things you mentioned I would deregulate two, regulate the crap out of one and get the federal government out of the business of backing loans on another.

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#82

Post by 0xDEFC0DE »

tomatocracy wrote: post #42
imgabe wrote: post #29

Why is this a problem? Some very rich people become a little bit less rich. None of them seem to be in danger of falling into penury over only getting $1M for their house instead of $2M. Sounds like the supply and demand working the way they're supposed to.

At a macro level and over the long term, even if prices fall and this means that slightly less rich people can buy them instead, big houses are more expensive and more work to look after and maintain and there is a limit to the number of people willing and able to do that. The ultimate end result could be that some of these houses become derelict, which isn’t really good for anyone. This is what happened to a good nu…

Knock $10-20k off the price and put that towards hiring people to clean it. Bundle the house sale with cleaning services for a few years or something. The amount of people willing to deal with it will grow as the price falls, but that's not newsworthy. That's the uncomfortable truth for people wanting to sell.

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#83

Post by noobermin »

imgabe wrote: post #29

Why is this a problem? Some very rich people become a little bit less rich. None of them seem to be in danger of falling into penury over only getting $1M for their house instead of $2M. Sounds like the supply and demand working the way they're supposed to.

People don't like it when supply and demand applies to them, especially wealthier folk like those who can build mansions.

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#85

Post by alistairSH »

alkonaut wrote: post #28
pjc50 wrote: post #5

This is not only "first world problems", but 1% first world problems. Well, maybe 5%: given > For their retirement in a suburb of Asheville, N.C., Ben and Valentina Bethell spent about $3.5 million in 2009 to build their dream home: a roughly 7,500-square-foot, European-style house with a commanding view of the Blue Ridge Mountains. Put $3.5m into https://dqydj.com/net-worth-percentile-calculator-united-sta... and yo…

I don't get why you'd want to build an enormous house for your retirement ? If anything, I long for the day my kids leave and I can move to a "simpler" place where I don't need to worry about, or pay for, maintainnig a detatched house. What does a rich older couple do in 7500sq ft/700sq m? I'd run out of ideas for rooms after about 200 sq m, and then I'm left to clean the remaining 500 sq m. anyway...

Right there with you. We sold our 1800sqft single-family for a 1500sqft townhome shortly after the kid flew the nest. And we still have two bedrooms that are seldom used (one is a guest room, used 3-4x/year, the other is an office used never, except by the dog).

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#86

Post by mordechai9000 »

pjc50 wrote: post #5

This is not only "first world problems", but 1% first world problems. Well, maybe 5%: given > For their retirement in a suburb of Asheville, N.C., Ben and Valentina Bethell spent about $3.5 million in 2009 to build their dream home: a roughly 7,500-square-foot, European-style house with a commanding view of the Blue Ridge Mountains. Put $3.5m into https://dqydj.com/net-worth-percentile-calculator-united-sta... and yo…

> They are unlikely to have mortgaged it, as most lenders won't lend past retirement for obvious reasons

You can't deny a loan due to age in the U.S. It's specifically forbidden by federal law.

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#87

Post by igetspam »

mhb wrote: post #38
alkonaut wrote: post #28

Earlier quoted context omitted.

I don't get why you'd want to build an enormous house for your retirement ? If anything, I long for the day my kids leave and I can move to a "simpler" place where I don't need to worry about, or pay for, maintainnig a detatched house. What does a rich older couple do in 7500sq ft/700sq m? I'd run out of ideas for rooms after about 200 sq m, and then I'm left to clean the remaining 500 sq m. anyway...

What does a rich older couple do in 7500sq ft/700sq m Tools

I like your style!

So much making could be done. I'm in a ~4000sqft home right now and all I really want is a workshop with and office. I'd downsize to almost nothing if I could detach from the house and do stuff and thing.

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#88

Post by low_poly_shiba »

dsfyu404ed wrote: post #81
woofie11 wrote: post #47

Earlier quoted context omitted.

Which is a fair expectation to have. Free markets are nearly optimal for commodities, restaurants, and similar sorts of goods, as well as many competing small businesses. They grind along for IP, utilities, and some sectors of education, as well as large businesses. They break down almost completely for large-scale finance, real estate, medicine, and other sectors of education. Curiously, much of this was predicted b…

>They break down almost completely for large-scale finance, real estate, medicine, and other sectors of education. You just rattled off a list of sectors where the free market is the least free (though in the case of finance I think they more than earned it). Of the four things you mentioned I would deregulate two, regulate the crap out of one and get the federal government out of the business of backing loans on ano…

hmmm you elsewhere, on a topic about the harrowing conditions of FB moderators, claim that "there's a lot of variance between individuals ... I'm not the kind of person that's particularly bothered by graphic violence. My opinion of humanity is dark enough to accommodate it"

https://news.ycombinator.com/item?id=20223267

maybe what you consider an ideal world or even positive outcomes or even onerous regulations are not what others have in mind, what with your "dark views of humanity" and all?

cause it sounds to me like you deeply believe in naturalistic hierarchies

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#89

Post by notatoad »

mordechai9000 wrote: post #86
pjc50 wrote: post #5

This is not only "first world problems", but 1% first world problems. Well, maybe 5%: given > For their retirement in a suburb of Asheville, N.C., Ben and Valentina Bethell spent about $3.5 million in 2009 to build their dream home: a roughly 7,500-square-foot, European-style house with a commanding view of the Blue Ridge Mountains. Put $3.5m into https://dqydj.com/net-worth-percentile-calculator-united-sta... and yo…

> They are unlikely to have mortgaged it, as most lenders won't lend past retirement for obvious reasons You can't deny a loan due to age in the U.S. It's specifically forbidden by federal law.

you can deny a loan due to the applicant not being employed though, right?

Re: A Growing Problem in Real Estate: Too Many Too Big Houses

#90

Post by wayoutthere »

At least in my area, the cost of permitting and labor is such that it’s simply not worth building a house unless you can sell it for over $500k. Which means they’re only building large, 4 bedroom houses, most in the $750k range. The vast majority of prospective homebuyers cannot qualify for a loan that big.

Meanwhile the rent on a 2 bedroom apartment is more than a mortgage on one of those houses. So guess why so many people are renting?

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