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

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

#261

Post by 908B64B197 »

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.

What are the odds these are used to park (questionably acquired) assets by wealthy foreigners?

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

#262

Post by satokema »

tayne wrote: post #251
jjoonathan wrote: post #241

Earlier quoted context omitted.

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.

"You don't need a formal conspiracy when interests converge."

The landlords don't need to conspire - they know what's good for them and the politicians either own property themselves or are connected enough to landlords to help them out.

None of these parties have an immediate interest in the lower class affording housing or maintaining the community fabric in the long term - especially the faceless incorporated ones.

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

#263

Post by Spivak »

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.

Months is way too short a timeline to say anything. There is no market force that says these houses must sell right now today and so like literally every other asset they’re being held until in the expectation that offers will come in that meet the asking price.

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

#264

Post by ChuckNorris89 »

em-bee wrote: post #255
ChuckNorris89 wrote: post #239

Earlier quoted context omitted.

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.

Sorry but no, it IS much easier to find a place to rent in the US.

In Germany, the scarcity is so high that realtors can afford to ghost you left and right despite you having money and then when you finally get to view an apartment there's like 80+ people viewing it and only the one with the best portfolio (full of your private info that they normally shouldn't be allowed to have) gets it. This madness is nowhere near what it's like in the US.

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

#265

Post by moistly »

willcipriano wrote: post #233
bombcar wrote: post #208

Earlier quoted context omitted.

Yeah, even a furnace replacement (was about $8k let's say, including AC) that should be done every 20-30 years is $25-35 a month - those things start to add up if you account for all of them. Roofs are 40 year so you might escape that one, but all the appliances are probably 10-15 year lifespan, and most people wouldn't even think of a new fridge as "maintenance".

One thing to note is you can put things off. My furnace is from the early 80's, I'll replace it when it dies but it works fine. I'm kinda looking forward to it so I don't have to use window units for AC anymore. If the idea is you want a immaculate house with everything perfectly maintained then you can have high costs, but for example my microwave door handle busted off, I rigged up a fix, it looks terrible but not…

Your old furnace may well be costing you more in fuel than the cost of replacement. A 1980s furnace is likely well under 60% efficient, plus it drafts inside air up the flue. A new furnace will be 90%+ efficient and the firebox will use outside air.

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

#266

Post by CincinnatiMan »

jjoonathan wrote: post #26
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…

The people in charge have houses and want house prices to go up. That's the beginning, middle, and end of the thinking.

I don't think it's that simple. Maybe if someone has lots and lots of investment homes, they may think that way, but someone owning a single home shouldn't be excited about its price inflating--it's not like you can sell it and reap the profits, because you'll just be buying another similarly inflated house.

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

#267

Post by ClumsyPilot »

nradov wrote: post #220
ClumsyPilot wrote: post #70

Earlier quoted context omitted.

Millions of people have started families in slavery too. And during the plague. What wisdom does this argument lead us to - basic hygene and human right are superfluous?

Renting a home is in no way comparable to slavery. Your comment is offensive, inflammatory, and off topic.

I think you are misunderstanding my argument - the statement is not 'renting is like slavery'

The argument put forward previously was 'people were starting families without X, therefore people not having X isn't a problem', where X was a house.

I was trying to demonstrate that no matter what you substitute for X, even something extreme like basic human rights, people were still starting families, therefore either we should not be concerned about anything, or the argument is flawed.

Also many people were rendered homeless or pushed into poverty by the current housing crisis, and I am sure those folks find the argument proposed above offensive and inflammatory.

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

#268

Post by thatfrenchguy »

dont__panic wrote: post #212
jimmydorry wrote: post #199

Earlier quoted context omitted.

What job prospects would your kids have, and would it even have been possible for you to start your career if you lived in the area you are planning to move to for the critical years (high school, university, first few years entering your field, etc.)? If the answer to any of these questions is no, then you have your answer to why property prices near the cities aren't ever going to match the level of rural propertie…

Depends a lot on comfort with remote work, especially when onboarding college grads. I'd say time will tell how society deals with that. I grew up in a crappy rural area with next to no opportunity, and went to college in a crappy rust belt city with very little opportunity. Moved to NYC the day after graduation to start my career. As far as I can tell, if my life was playing out today , I'd probably pick up a remote…

> SF, NYC, etc. might lack opportunities for your kids, too -- it's not like they can explore nature, or mountain biking, or sailing, or a million other things easily in your average US city

San Francisco has some the best access to nature, sailing and mountain biking anywhere in the country. I can drive for 15 minutes and be on the beach, in the mountain. And it's never too cold or too hot.

> I grew up in a crappy rural area with next to no opportunity, and went to college in a crappy rust belt city with very little opportunity

Don't assume the fact that you made it means that your kid would repeat that feat though.

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

#269

Post by ClumsyPilot »

wonderwonder wrote: post #209
lupire wrote: post #196

Earlier quoted context omitted.

Do they also hate their children?

Nope, I would bet a lot of these people had the means to gift their kids a nice down payment for their first home. That's why the best indicator of where you end up financially is where you start.

downpayment doesn't get you out of the hole -> you are still on the hook for decades, to keep sinking the majority of your earnings into that house. That's money lost to productive economy, and money lost to you.

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

#270

Post by ClumsyPilot »

vkou wrote: post #187
ClumsyPilot wrote: post #65

Earlier quoted context omitted.

Do they plan to live in a tent after they 'used' the house and sold it? Because if they plan to buy a new house to replace the one they sold, they haven't made any money. And if they want to upgrade, they lost money and the price difference will have increased. The only case where you benefit from rising hoise prices is if all of your income comes from owning property, rather than working a job - i.e. you are a major…

They can either downsize towards the end of their life, move to a less desirable housing market (because there are no jobs in it), or take a loan against their home.

Normally people optimise for their life, not for their eventual few years of retirement and death.
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