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Homes in 97% of U.S. cities are overvalued, Moody's says

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Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#301

Post by immigrantheart »

Sorry this is just another dumb me trying to see what solution could be.

Maybe 3rd world countries could start opening up their citizenship/PRs for US/Western Europe/Canada/Japan/Korea/1st world citizens. i.e, Give up your origin citizenship, say US, for Indonesia for example (because Indonesia doesn't allow dual citizenship), and gain these benefits for you:

- Extremely cheap cost of living

- You can own a house and a yard as big as you want, with nice cars, and maids, drivers, gardeners

- You can send your kids to international school that are cheaper than your private school, and also of better quality education wise than your local public school

Meanwhile, Indonesia will gain:

- The new citizens/PRs can help create opportunities/businesses in Indonesia and employ locals

- The new citizens/PRs will spend their money in Indonesia, buying local goods and services

For example, a nice area in Serpong (just a bit south of Jakarta, cluster-style 2 story houses, 3 bedrooms, will cost you around $150.000. Complete with security guards.

I'm sure there are other countries that are ok too, like Thailand, Vietnam, Philiphines.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#302

Post by dodobirdlord »

InTheArena wrote: post #219
01100011 wrote: post #117

Earlier quoted context omitted.

> Something is broken Say it with me: > “Inflation is always and everywhere a monetary phenomenon...” - Milton Friedman It turns out years of suppressing rates combined with dumping many trillions of dollars onto a supply constrained economy causes a rise in prices. Huh... You'd think the trained professionals at the fed would know this by now, but they continue to believe they can defy reality.

So much for MMt(at least the way that certain people perceived MMT to be) We are about to pay for 12 years of easy money policies.

The crux of MMT is the idea that spending creates money and taxing destroys money, so deficits are made up and only inflation matters. Doesn’t seem like a “so much for” moment for MMT, which also predicts this if there’s too much money in the economy. The real question is whether there’s political appetite for the MMT-prescribed treatment here, which is to significantly raise taxes. I’m guessing no.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#303

Post by contrahax »

snidane wrote: post #290

Houses lose value by depreciation. In few decades the value is zero, then becomes negative - the price of demolition for the next project. What gains value over time is land. Poeple only think they invest in houses, but they are fooling themselves and overspend on the construction and interiors. They pay for land. Easy to prove - construction material and labor are highly mobile. Cement, bricks and imported labor cos…

Most of the 1-10M+ homes in NYC, SF, etc. were built 100+ years ago. I know a number of people who live in perfectly nice homes built in the 1700s in rural areas that have consistently kept their values. Homes don’t depreciate and need demolition “within a few decades” if you just keep up with basic maintenance. If you don’t believe my anecdotal evidence, you can do a basic Zillow search and filter by price over 1M and built before 1980 and see how many results you get all over the country.

I wish this were true legally - my property tax bill on my 40 year old house would be 0, but sadly it increases every year as my home value appreciates.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#304

Post by andrewljohnson »

11235813213455 wrote: post #299
melissalobos wrote: post #4

Isn't this one of those "If everyone is crazy, you're crazy" situations? If every house is overvalued by some metric, then maybe the metric is wrong. People's perceptions of value are a large part of the actual value(meaning what someone would really pay) for things like housing that should depreciate over time.

I don't know how it works in the US, but in France, when you buy an apartment or house, you pay about 8% to the state (notary / attorney fees), that participates in the inflation I guess

In the US, you pay about 6.5-7%. You pay 5.5 to 6% to the two agents (buyer and seller agents) and about 1% in closing costs (title insurance, etc).

It has always seemed wildly inefficient to me. Especially the “buyer agent” who gets a couple percent entirely for escorting the buyer through homes and submitting an offer.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#305

Post by fibonachos »

frosted-flakes wrote: post #246
pcmoney wrote: post #174

Earlier quoted context omitted.

“Full health coverage” according to all my EU and especially British friends I would still be on a waitlist for a surgery I had 2+ years ago.

Non-essential surgeries tend to have longer wait times (such as hip replacements in elderly people), but conversely, essential care is accessible to everyone at no cost and in a timely manner. I live in Canada, and recently had appendicitis. My appendix was removed less than 24 hours after symptoms began, and 10-12 hours after I arrived at the hospital. I walked in to the ER (after a very painful car ride), they aske…

What you describe in your last sentence is one of the reasons I went with Kaiser. Yes, there are still co-pays for most treatments and prescriptions, but they have in my experience never been more than $20. This includes an elective procedure. It seems to share some aspects of the Canadian system you described, such as longer wait times for non-essential care, and a relative lack of choice in which doctor you see. But to me that is an acceptable trade-off for care where no single visit has cost me more than I would have spent on lunch that same day, and has been consistently of high quality.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#306

Post by Aeolun »

oceanplexian wrote: post #111
pjmorris wrote: post #91

Earlier quoted context omitted.

I think there's a more concrete measure of value: house prices related to income. Historically (Robert Shiller has a chart for the US going back to 1890) house prices (and mortgages and rents) have maintained a stable relationship with income. Occasionally that relationship is strained but it has usually fallen back in line. One exception to this was the extraordinary, ongoing, support to the financial system post-20…

There’s no rule that you should be able to afford a house on a middle class income. In fact in many countries, particularly in Western Europe, it’s unimaginable that you would be able to afford a detached, single family home on a middle class income. Lots of people in that situation will live in apartments, row houses, or condos for the rest of their lives.

Row houses in any marginally desired area in western Europe easily go for half a million now. That’s firmly out of reach of the middle class.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#307

Post by ChrisMarshallNY »

senkora wrote: post #286
EVa5I7bHFq9mnYK wrote: post #277

Earlier quoted context omitted.

Houses in the US couldn't serve as intergenerational asset simply because they are built of wood with average livespan of ~70 years. While in Europe houses are generally build of brick or cement and last centuries.

I think it is clear that the parent is using home-ownership to include land-ownership.

Don’t know how it is in most of Europe, but I think that, in the UK, you don’t actually own the land your house sits on; Lord Such-and-Such owns it, and collects rent from you.

In the US, we own the land, and that is usually the real value. I’m the proud owner of a 0.125-acre New York postage stamp. It’s in a fairly affluent area, so is fairly valuable. In Wyoming, they’d laugh at it.

I think Japan is similar.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#308

Post by asdff »

bombcar wrote: post #295
asdff wrote: post #266

Earlier quoted context omitted.

I think the biggest factor whether or not prices have room to fall is how built out an area is to its zoned capacity and how many jobs there are in the given metro area. Job growth incurs population growth with incurs development. Development will continue if there is sufficient population demand. In cities like LA, job growth has triggered huge surges in the population over the past century, and in turn this trigger…

There's also strong differences in density - in the US it's often either single family homes or apartment high-rises; but if the City of Los Angeles had the 5-10 story wall-to-wall houses that Paris has it could see a population of 22 million, compared to the current 3.8. Going for the metro area could be even larger. One huge advantage places like Paris have is that they've been dense for so long that there is older…

There is a lot of this middle density already in places like the city of LA. This is a good map showing the true density of different parts of the city (1). The darkest blue are about as dense as the densest parts of paris (50k/sqmi). The model is already there in American cities, it just needs to be expanded to more neighborhoods especially near the job centers which are increasingly in these low density suburbs over transit connected urban cores. This also makes it more challenging to serve transit to more people when only a small portion of your workforce is traveling along any given corridor and in multiple directions). This is an older map not showing the more recent rail lines, but it shows how jobs are distributed across the county unevenly and how convoluted the commutes can grow to be in order to get to these different job centers across the county from the dense housing areas which don't always overlap the dense job centers (2).

1. https://i.redd.it/v84al8v4ymp11.png 2. https://i0.wp.com/thesource.metro.net/wp-content/uploads/201...

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#309

Post by [deleted] »

immigrantheart wrote: post #301

Sorry this is just another dumb me trying to see what solution could be. Maybe 3rd world countries could start opening up their citizenship/PRs for US/Western Europe/Canada/Japan/Korea/1st world citizens. i.e, Give up your origin citizenship, say US, for Indonesia for example (because Indonesia doesn't allow dual citizenship), and gain these benefits for you: - Extremely cheap cost of living - You can own a house and…

[deleted]

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#310

Post by 88840-8855 »

immigrantheart wrote: post #301

Sorry this is just another dumb me trying to see what solution could be. Maybe 3rd world countries could start opening up their citizenship/PRs for US/Western Europe/Canada/Japan/Korea/1st world citizens. i.e, Give up your origin citizenship, say US, for Indonesia for example (because Indonesia doesn't allow dual citizenship), and gain these benefits for you: - Extremely cheap cost of living - You can own a house and…

Most people will not give up family, friends and roots for a house in some third world country.

People have jobs where they live, they know the city or at least the country. The language is not a problem, they are familiar with food, laws, standards, processes.

I worked in many different countries before, developed and less developed. It's "fun" for a while, but in my experience people don't want to stay, they only stay temporarily that for career reasons.

Plus, how long will it take until the local folks will get mad because your kids are treated better (in the international school), you have a bigger house, enjoy a better life? There will be the same "those migrants are taking away our stuff!!!" sentiment that we already know here in the WeSt.

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