Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Why developers seem to only build luxury housing (2018)

ggwash.org

Post reply on HN
Print view View original

21–30 of 185 posts

Re: Why developers seem to only build luxury housing (2018)

#21

Post by bombcar »

chrisseaton wrote: post #10
xhkkffbf wrote: post #5

It strikes me that new anything is usually better than older, used things. So almost by definition, anyone building a new version of X is going to build something nicer than the old, used versions of X and this will be perceived as a luxury. Sure there are edge cases like nice antiques and the building where they filmed Downton Abbey but for the most part older stuff is just less nice.

In the UK new-builds are seen as the worst option. Most people want a house from the 20s or 30s if they can. Every decade beyond that the quality of housing got worse and worse and worse. These days buying a new house is a desperate option for people who can’t afford anything else.

There’s some of that in the US but the reality is that modern home construction is way ahead on energy usage, even if the homes aren’t built from solid timbers and boards.

Re: Why developers seem to only build luxury housing (2018)

#22

Post by foobarian »

Something I noticed happening around Boston metro starting with the pandemic is there is a lot more new builds than additions and remodels. The remodel we tried to do ended up significantly delayed due to labor and other shortages, and shopping around was very difficult. It made me wonder whether the developers prefer the hassle-free experience of unoccupied or new builds where you don't have constant headaches of finding old out-of-code shit, having to design custom workarounds, back and forth with the owners, keep the existing structure protected from elements, etc. I can imagine if the work is very asynchronous it would add hidden costs as well due to inefficiency.

Re: Why developers seem to only build luxury housing (2018)

#23

Post by zbrozek »

Let's say I'm a developer and there's unmet demand at all price points. Obviously I build the highest-margin product until I've satisfied that demand. Then I move on to the second-highest-margin product until I've satisfied that demand.

Anywhere that demand across the spectrum dramatically outstrips production capacity (e.g., anywhere in the Bay Area, where NIMBYism has made it nigh-impossible to build anything) what little production manages to happen will target the high end of the market.

You have to build enough to make satisfying demand at the bottom worth doing. Our regulations (onerous constraints to construction and land use) preclude that outcome.

Re: Why developers seem to only build luxury housing (2018)

#24

Post by h2odragon »

why don't more people act as their own architect / build more of their housing themselves?

I'm coming from an attitude of "a house is a home, a machine to make the lives of my family easier and more comfortable", not "houses are an investment with incidental utility as shelter." Is it that many don't care about their house as a home?

Re: Why developers seem to only build luxury housing (2018)

#25

Post by api »

seibelj wrote: post #17

I’m a developer. I do tons of work to get the right to build - buy the property, the permits, the environmental review, neighbor meetings where they oppose it, more legal and municipal review, this drags on for years. Now after all of these fix costs would I rather build luxury units that net me tons of money or affordable units that net me little money? And also the neighborhood itself is opposed to a lot of low-inc…

This is the answer, and it's kind of amazing the strange contortions people go through to not admit it. Regulation is a tax. Review requirements are a tax. NIMBY opposition is a tax. Complex irregular permitting requirements are a tax. All those taxes must be paid up front by the developer, so obviously developers are only ever going to build high-margin high-income housing. They'd probably lose money on anything else.

Re: Why developers seem to only build luxury housing (2018)

#26

Post by starky »

xwdv wrote: post #13

Isn’t it obvious? It doesn’t cost much more to build a luxury house but you can sell it for way more profit than if you built a regular or shitty house.

Exactly, "Luxury" really just means high-end looking finishes built at the lowest possible quality they can get away with. At least in my city all the new builds are absolute shit quality.

Re: Why developers seem to only build luxury housing (2018)

#27

Post by dazc »

chrisseaton wrote: post #10
xhkkffbf wrote: post #5

It strikes me that new anything is usually better than older, used things. So almost by definition, anyone building a new version of X is going to build something nicer than the old, used versions of X and this will be perceived as a luxury. Sure there are edge cases like nice antiques and the building where they filmed Downton Abbey but for the most part older stuff is just less nice.

In the UK new-builds are seen as the worst option. Most people want a house from the 20s or 30s if they can. Every decade beyond that the quality of housing got worse and worse and worse. These days buying a new house is a desperate option for people who can’t afford anything else.

Elephant in the room being the 'help to buy subsidy'. Half the deposit needed for a new build rather than an old build.

That said, I'm not sure I have much sympathy for these buyers. There is a new esatate near me where everyone is driving a newish car in the 30-50K price range?

Re: Why developers seem to only build luxury housing (2018)

#28

Post by scarface74 »

chrisseaton wrote: post #12
CalRobert wrote: post #6

Earlier quoted context omitted.

I can't fathom the logic behind the idea that we'll get people to build brand new housing to a high spec and sell it for less than existing, very expensive housing. Every time anyone builds stuff near me there's cries of "BUT IT'S NOT AFFORDABLE!!!" and I just think... duh? New cars are expensive too, which is why you buy a used one....

But older houses are better (nicer architecture, better materials, more space, more mature trees) than newer houses.

With asbestos, lead, I couldn’t just pick a piece of land and go to a showroom and get exactly what we wanted. Choose to get cat 6 prewired throughout the house. Some really old ones don’t have central air (even my parents house they had built in 1978 did).

I’ve bought five properties over the years. The two I bought to live in I had built and never had the maintenance costs people complain about (2002-2012 and 2016 - present).

Re: Why developers seem to only build luxury housing (2018)

#29

Post by actionablefiber »

nopenopenopeno wrote: post #15
CalRobert wrote: post #3

There's a great reddit thread exploring much the same issues at https://www.reddit.com/r/LosAngeles/comments/6lvwh4/im_an_ar... Turns out, requiring little houses for cars be added on to every house for people gets expensive.

This make excellent sense, and the only solution would necessitate public transportation. Unsurprisingly, whether it’s public housing or public transportation, there really is no way around investing in public infrastructure if you want to have a healthy society.

Public transportation is one piece of the puzzle. Cities that are truly great for car-free living are also walkable and cyclable, and have dedicated infrastructure to this end. Public transit gets you part-way there, since unlike cars, public transit, even buses, do not really make the streets dangerous and hostile the way that individual transport vehicles do. Still, it's important to remember that public transit is a key part of a broader approach to the problem and not the end-all solution itself.

Re: Why developers seem to only build luxury housing (2018)

#30

Post by ethbr0 »

routerl wrote: post #16
jimmaswell wrote: post #14

Earlier quoted context omitted.

Quality of life is expensive, doesn't mean it's not worth it. Not that there shouldn't be some allowances for denser apartment buildings.

Car-centric living is absolutely not quality-of-life focused...

Depends where you live. That's a broad assertion to cover a wildly divergent spectrum of community types.
Post reply on HN