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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

#441

Post by notch656a »

turtledove wrote: post #426
notch656a wrote: post #409

Earlier quoted context omitted.

>Also, government operated facilities do not have a profit motive, Great, so the shit-show we have now, except without any incentive to efficiently spend. Sure that will go over swimmingly. Everyone knows that government construction projects are known for coming on-time and on-budget, and for the best value.

Seattle just built a major light rail expansion ahead of schedule and under budget. But I specifically believe in building more, smaller units. Places with eg 20 apartments. By building smaller scoped projects, costs are better understood up front, maintenance costs are lower, and you need less specialized construction expertise. Building 50 20-unit complexes to house a thousand families is going to serve everyone be…

This light rail [0]?

[0] "Light-rail cost soars $1 billion" https://archive.seattletimes.com/archive/?date=20001213&slug...

--------

Edit: here's another one

"Sound Transit’s light-rail system, called Link, has also had its share of challenges. The 25 miles of light rail that voters were told would be completed by 2006 at a cost of $1.7 billion, have resulted in 23 miles of track which, when completed, will end up costing $5.2 billion."

"The $2.6 billion spent so far on the starter light-rail line takes the rider from Westlake Station downtown to an airport station 0.4 mile from the terminal in 37 minutes. "

https://seattlebusinessmag.com/article/why-sound-transits-pr....

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

#442

Post by turtledove »

jdhendrickson wrote: post #372
turtledove wrote: post #359

Earlier quoted context omitted.

Not a birthright, I don't think it should move across generations, but I do think that it's needlessly cruel to force someone out of their home because wealthier people want to live there. As for tenants v landlords, I believe it should be difficult to evict tenants except in cases where the tenant is clearly a danger to others or to the home itself. If they are vandalizing the property, that should be an eviction. L…

Do you not see any obvious flaws in your desired changes?

Depends. But what you label a flaw, I might label a feature. There is space for both of us to disagree about whether certain outcomes are desirable or not.

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

#443

Post by thow-58d4e8b »

nivenkos wrote: post #397
turtledove wrote: post #345

The sooner we collectively decide that housing shouldn't be a market, the better. We all need it, and we should figure out mechanisms to make it available to all. Practically that means paying to build and maintain housing stocks, changing tax incentives so developers are incentivized to build more housing and less luxury housing, charging a premium for unused land in desirable areas (parking lots don't house people)…

A more practical solution is housing coops like the BRF system in Sweden. Individual landlordism is mostly banned (there are some company rentals though) - you buy the place you live in, and there are restrictions on renting it out (no more than 2 years in a row, etc.). It's helped a lot here. I don't think that social housing is a good solution. It's a complete disaster here in Sweden, with 12+ year waiting times, a…

> BRF system in Sweden

To expand on this point, and a similar system in Finland called asumisoikeus:

Municipalities have a pool of housing units. The tenants do not buy the house itself, they buy a right to live in that house, which usually costs about 10% of the price of the house, reimbursed when they move out. They also pay a rent that takes care of the energies and depreciation of the house. Socio-economic status is taken into account when figuring out who's eligible

Now, there are some criticisms of the system, mainly that the rents aren't that much lower than commercial properties. However, it does keep house prices in check. 100m^2 (~1100 sqft) house in the capital region is about 9 years of average take-home income - or 5 years for a couple

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

#444

Post by headsoup »

turtledove wrote: post #416
paisawalla wrote: post #390

Earlier quoted context omitted.

How will you be deciding who gets to have a view of the ocean, and who gets to sleep next to the overpass? First come first serve? Birthright?

You could have a lottery, adjust prices within a regulated range, offer incentives for less desirable lots. You could reward developers for lots that have long wait lists and lots of interest, incentivizing developers who build places people want to live.

What if someone less fortunate 'wins' the mansion on the beach. How do they afford the future upkeep?

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

#445

Post by account42 »

cycrutchfield wrote: post #392
turtledove wrote: post #380

Earlier quoted context omitted.

Hundred percent. I have a personal ethos that believes profit from rent is amoral, but we could probably address housing concerns without meeting my personal ethics standards, which I freely admit are more extreme than most.

“profit from rent is amoral”. Care to elaborate on this? Does this ethical standard also extend to other human needs as well? For instance should farmers not be able to profit from providing food?

If the farmer disappears, the food will no longer be produced. If the landlord disappears, the house will still be there.

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

#446

Post by pooper »

turtledove wrote: post #413
piotrkaminski wrote: post #395

Earlier quoted context omitted.

Housing is very, very far from being a commodity.

In what sense? I mean, I'd love it if that were the case, but at least here in the US housing is extremely commodified.

I think gasoline or diesel is a commodity because for the most part a gallon of gasoline is a gallon of gasoline whether you buy it at Shell or at Costco. I mean Shell will probably try to say they have better detergents or whatever but for the most part they are the same.

Similarly, one unit of electricity from solar is the same as a unit of electricity because a kilowatt hour is a kilowatt hour. You could say well my unit of electricity is better because Elon Musk sold it but for the most part they do the same thing.

Housing is not that very interchangeable. For example, in the Denver area in Colorado apparently the Cherry Creek area commands a higher sticker price because of the school district.

Some homes are just more desirable than others. For me, I desire:

* Excellent public transit

* Excellent symmetric high speed fiber optic Internet connection to the home

* Costco or Sam's Club within half an hour or inexpensive grocery stores within walkable distance

And there are unspoken assumptions like somewhere an ambulance can get to me in time if I am dying and take me to a hospital so good roads and proximity to a good hospital.

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

#447

Post by turtledove »

paisawalla wrote: post #375
turtledove wrote: post #359

Earlier quoted context omitted.

Not a birthright, I don't think it should move across generations, but I do think that it's needlessly cruel to force someone out of their home because wealthier people want to live there. As for tenants v landlords, I believe it should be difficult to evict tenants except in cases where the tenant is clearly a danger to others or to the home itself. If they are vandalizing the property, that should be an eviction. L…

So the landlord what, eats all of the downside in that scenario? But I'm sure you'd also restrict their ability to raise rents on other tenants (if they have multiple units) to compensate, so why would the landlord even do this to begin with? It's potentially 100% downside and restricted upside.

Yep. You got it in one. Private landlords are a part of the problem. They have every incentive to prevent new housing from being built. It should be challenging to be better at providing housing than the municipality government.

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

#448

Post by marvin »

zamfi wrote: post #314
trgn wrote: post #271

Earlier quoted context omitted.

The US is rotating from housing as commodity investment to housing as intergenerational asset, something which has happened in a lot of other countries already (see e.g. Western Europe, mentioned in other comments here). House prices will remain up because any gain from sale will be plowed into the next home. It's a ratchet upward. Higher mortgage rates are somewhat irrelevant in this dynamic, because the home itself…

> USA was inoculated for a very long time, because horizontal expansion over cheap land allowed for expansion of supply. That era is over. True. > Car and highway technology is no longer adequate to expand cheaply and still remain within viable commuting distance. False. The US has mind-boggling amounts of land available. What's changed is the ability and desire to build on it. Used to be, the government would pay yo…

> What makes building housing expensive is policy, not a lack of "cheap land".

I am flummoxed every time the discussion of housing prices shows up. Seems like 95% of everyone who comments is completely clueless to the most basic aspects of it.

In the vast majority of Western regions, high home prices are caused by a deliberate decision not to allow building enough homes to match demand, in the places where people want to live. It's really that simple.

In itself, this is a state of affairs we could accept as the current democratic consensus, but it's really stupid when most discussion of the problem pretends that the root cause is something else.

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

#449

Post by t_mann »

nivenkos wrote: post #397
turtledove wrote: post #345

The sooner we collectively decide that housing shouldn't be a market, the better. We all need it, and we should figure out mechanisms to make it available to all. Practically that means paying to build and maintain housing stocks, changing tax incentives so developers are incentivized to build more housing and less luxury housing, charging a premium for unused land in desirable areas (parking lots don't house people)…

A more practical solution is housing coops like the BRF system in Sweden. Individual landlordism is mostly banned (there are some company rentals though) - you buy the place you live in, and there are restrictions on renting it out (no more than 2 years in a row, etc.). It's helped a lot here. I don't think that social housing is a good solution. It's a complete disaster here in Sweden, with 12+ year waiting times, a…

Has it really helped? I remember talking to a young Swede a while ago, just a few years out of college. He said he bought a flat in Stockholm pretty much as soon as he had a job, and that the price appreciation since has almost outstripped his salary.

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

#450

Post by halotrope »

Everyone seems to agree that speculation in housing is a global problem with adverse effects on communities and societies. Toronto seems to be a good example of how the end-game will look like. People are priced out of owning a home for good and/or have to leave places where they might have been living for their whole life. Rent controls don't seem to work, and just cancelling (by whatever means) the market for real estate in general might yield a lot of unwanted side-effects. I believe there are 'simple' measures to curb rampant speculation without distorting the market to badly:

- Disallow foreign investment in residential real estate.

- Disallow for-profit corporations to purchase residential real estate.

- Stop subsidizing speculation by bailing out real estate investors

- Invest in infrastructure so that living apart from big cities is more worthwhile. Especially broadband internet and schools.

- Add a tax penalty to vacant residential real estate.

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