Why the government took home prices out of its main inflation index • Hacker News Board

Re: Why the government took home prices out of its main inflation index

#251

Post by tayne » Fri, May 27, 2022, 5:23 PM UTC

jjoonathan wrote: post #241

tayne wrote: post #216

Earlier quoted context omitted.

I do real estate for a living and this opinion is like a zombie that never dies no matter how many times it is proven wrong. You are putting forward that landlords acted collectively to increase the price of realestate. This is obviously wrong. The price of homes is determined by the market. It doesn’t matter who owns those homes, they are worth what the market says they are. Landlords do not control the market and e…

Nice try. Landlords and homeowners and the finance industry don't control the market... they just form a political bloc that controls zoning and taxes and transportation infrastructure and central finance, and these knobs in turn control the market. For some reason, they always vote for policies that pump their holdings. Can't imagine why. These policies do create problems, though, and it's not only reasonable to att…

Again, landlords aren’t a big enough group or coordinated enough to do anything. There’s no landlord lobby. Homeowners are a different story. It’s them who stop us from building more. But yea, it’s just the market and there’s no conspiracy and landlords are the last people to blame. Your comment on my cognitive abilities is a petty insult and is not allowed on this platform.

Re: Why the government took home prices out of its main inflation index

#252

Post by bradlys » Fri, May 27, 2022, 5:26 PM UTC

jimmydorry wrote: post #221

coding123 wrote: post #215

Earlier quoted context omitted.

Programming jobs that are remote. I personally predict building homes will become a thing - as we reach 600k typical home sales level. We will find people building homes for 200k and selling them for 400k profit. The math is starting to make programming jobs not attractive to me at least. Do 1 per year.

Perhaps it will change in the future, but entering the field as a remote-only is an up-hill battle. Especially without contacts or experience. Not to mention that the bare necessity, a good and stable internet connection, is not really a thing yet. Perhaps StarLink will change that... but that's yet to be seen. If people looked at this honestly, they would have to admit that relocating from a city into a rural area f…

I think people here have a different definitions of rural btw.

Where I grew up - small town of 4000 with no major city within 3+ hours drive. Nearest “city” was 100k people about 100 miles away.

Even in that - I didn’t feel it was super rural but compared to most people - that is seen as remote. May as well live in the Alaskan wilderness in their eyes.

Some people consider a suburb outside of Indianapolis as “rural”.

Re: Why the government took home prices out of its main inflation index

#253

Post by antisthenes » Fri, May 27, 2022, 5:28 PM UTC

jjoonathan wrote: post #218

lupire wrote: post #196

Earlier quoted context omitted.

Do they also hate their children?

They want their children to rule in hell rather than serve in heaven. Not the wisest deal ever struck.

Well, if we're doing pseudo-philosophical soundbites, then hell is other people.

Better to rule than be ruled. At the very least it gives you a bigger safety net when you fall out of power.

Re: Why the government took home prices out of its main inflation index

#254

Post by juanani » Fri, May 27, 2022, 5:29 PM UTC

faangiq wrote: post #68

recursivedoubts wrote: post #20

https://www.longtermtrends.net/home-price-median-annual-inco... nb that there is little relation to interest rates, which have been steadily declining since 82: https://www.freddiemac.com/pmms with the recent spike, we are currently at ~2000 interest rates, when homes were at 4x incomes, rather than 7+x home prices have been absolutely bonkers, with two massive bubbles (we are in one right now) and the fact that this…

This was all part of the plan to build a nation of mindless debt slaves. It was very effective.

No post body was provided.

Re: Why the government took home prices out of its main inflation index

#255

Post by em-bee » Fri, May 27, 2022, 5:30 PM UTC

ChuckNorris89 wrote: post #239

em-bee wrote: post #237

Earlier quoted context omitted.

oh, sorry, i just looked it up. you are right. austria does allow time limited contracts. 3 years is the minimum, however. you can't have shorter time limits. also after the first year the tenant may terminate the contract any time (with 3 months advance notice), the landlord may not. and there is another interesting detail: time-limited contracts must be 25% less than comparable unlimited contracts. this however is…

Yeah, but finding a decent place to rent in Germany is the real problem. It's nearly impossible as everyone is locked into their rental units and will never move. You basically have to wait for someone to die.

but that's a problem everywhere that doesn't build enough new units to meet the demand. and i don't think it is any easier to buy a place. nor is it any easier to find a place to rent in the US.

Re: Why the government took home prices out of its main inflation index

#256

Post by 0xffff2 » Fri, May 27, 2022, 5:34 PM UTC

tjr225 wrote: post #108

ghaff wrote: post #87

Earlier quoted context omitted.

Starlink is a real gamechanger. My dad's house in Maine a little ways from a small city had 1Mbps "broadband." Houses further down the road had nothing wired and all the Plan Bs (conventional satellite/hotspot) were lousy options. While Starlink isn't 100% reliable I could actually work from there if I wanted to.

Could you? I have been remote for about 4 years and I have difficulty doing my job if my internet goes out for even an hour during my working time. I also have issues doing my job if I can’t stream audio/video due to speed issues- and this happens even with a hardwired connection on occasion.

I have been using Starlink as my only internet since I got it about 6 months ago (working fully remote since COVID). It isn't flawless, but it's substantially more reliable than Comcast cable ever was in the various apartments I lived in when I was in the Bay Area.

>I also have issues doing my job if I can’t stream audio/video due to speed issues- and this happens even with a hardwired connection on occasion.

What on Earth are you streaming that causes issues on a hardwired connection? I never have had speed issues with meetings, on Starlink or broadband at previous residences. I do have occasional latency spikes, but those seem to be getting better.

Re: Why the government took home prices out of its main inflation index

#257

Post by Jasper_ » Fri, May 27, 2022, 5:37 PM UTC

tayne wrote: post #216

Jasper_ wrote: post #203

Earlier quoted context omitted.

The supply was fine before multi-home owners and property management companies took up most of it and jacked up the prices. Increasing the supply would only increase the wealth of the homeowners, it won't lower prices. Increasing the supply means building new buildings, and that often means building huge lots of five-over-ones, priced as luxury apartments in a growing market. The people building the new supply expect…

I do real estate for a living and this opinion is like a zombie that never dies no matter how many times it is proven wrong. You are putting forward that landlords acted collectively to increase the price of realestate. This is obviously wrong. The price of homes is determined by the market. It doesn’t matter who owns those homes, they are worth what the market says they are. Landlords do not control the market and e…

There are luxury condos right where I live that are sold by a property management company. They are unoccupied, and have been unoccupied for months. The prices have not gone down.

There's no super strong market force to push the price of a house down, while there is a large market force to keep it valued where it is or make it go higher.

Re: Why the government took home prices out of its main inflation index

#258

Post by User23 » Fri, May 27, 2022, 5:39 PM UTC

bombcar wrote: post #186

User23 wrote: post #62

Earlier quoted context omitted.

Also while I can’t find internet sources, from talking to old people I get the impression most Americans had 15 year mortgages back the.

They still exist, 10, 15, 20, 25?, 30 years are all available. But most people don't search for the most value-effective house, they ask how much house can they buy and then buy that. If you're willing to step outside the east-coast corridors and/or break from suburban to "commuting rural" or further, it is quite possible to get a 10 year mortgage on a house on the median income.

The point is not their existence, it’s that the Case report is even more of an apples to oranges comparison. Imagine a time when for the same share of your income you could pay off the same house in half the time.

> it is quite possible to get a 10 year mortgage on a house on the median income.

If you don’t mind living in a meth infested trailer park maybe. I assume of course you’re talking about regional median income, not the national.

If you want to live someplace with a decent school district and a good community for raising a family on a single income like the silents and boomers could in major cities then rural America today is no magic bullet.

I have no problem with rural living but suggesting hey why not go homestead in BFE Alabama or something isn’t a refutation for housing policy destroying the middle class, which has largely been urban and suburban.

Re: Why the government took home prices out of its main inflation index

#259

Post by Rury » Fri, May 27, 2022, 5:48 PM UTC

randomdata wrote: post #150

em500 wrote: post #130

Earlier quoted context omitted.

How do you speak clearly and plainly about these topics? It's factually true housing prices aren't included in the CPI, but it's not easy to explain why and how replacing it with the somewhat abstract notion of housing services , estimated by owner equivalent rent is conceptually superior.

I would say the easiest way to explain it is, as implied by the "C", that CPI is intended to track consumption. Houses aren't normally consumed. Your house a decade from now is expected to be, more or less, the same house you purchased originally. You expect, more or less, to be able to sell it for at least as much as you paid for it originally. Whereas a consumable good, like food, is used up once you eat it and the…

>they question if CPI is the best metric for measuring inflation, not whether or not durable assets should be considered consumables

Right. Inflation is supposed to be a measure of erosion in purchasing power. Why should we leave out durable assets (which are purchasable things) from that measure and only consider consumable things? I get that's not CPI's intended purpose, but then why do people use it for defacto inflation?

Re: Why the government took home prices out of its main inflation index

#260

Post by NumberWangMan » Fri, May 27, 2022, 6:02 PM UTC

Jasper_ wrote: post #257

tayne wrote: post #216

Earlier quoted context omitted.

I do real estate for a living and this opinion is like a zombie that never dies no matter how many times it is proven wrong. You are putting forward that landlords acted collectively to increase the price of realestate. This is obviously wrong. The price of homes is determined by the market. It doesn’t matter who owns those homes, they are worth what the market says they are. Landlords do not control the market and e…

There are luxury condos right where I live that are sold by a property management company. They are unoccupied, and have been unoccupied for months. The prices have not gone down. There's no super strong market force to push the price of a house down, while there is a large market force to keep it valued where it is or make it go higher.

Respectfully, this doesn't prove that the law of supply and demand no longer applies. Any individual seller may choose not to decrease their prices -- but if they do it long enough, they run out of money and are forced to sell.

It's also difficult to tease out the effect of general price inflation. If house prices stay stagnant but currency is devauled, prices are decreasing in real terms.