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

121–130 of 185 posts

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

#121

Post by h2odragon »

lupire wrote: post #113
h2odragon wrote: post #24

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?

Why don't you build your own laptop and car and furniture and appliances?

Furniture is an especially good example where DIY is still possible to home handcraft, and desirable for individual fit, as well as many other reasons. Done that.

"appliances" too. moreso if you count frankenstein abominations that only I can run safely. there's some things I could sell to others and expect them to use without dying, so that counts.

"Laptops" meh. but I've had mobile computing things that featured structural duct tape and were indeed mobile, so I think that counts too.

"Car" ... I've assisted with the construction of go karts, dune buggies, and the repurposing of mass market cars into nasty perversions of their original functions. So I'll say "done that" too.

So yes, I think on reflection I can answer "I do."

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

#122

Post by foogazi »

kokokoko1 wrote: post #55

I think we continue to ignore asset inflation in these discussions. While there are obvious gaps and issues with physical construction and zoning, the real issue is that housing, and many other assets, have gone up way above inflation for the last 14 years. And the corrections do not wipe out enough of those gains. If we never solve the asset inflation problem with real estate values, all others issues are ultimately…

> have gone up way above inflation for the last 14 years

Money has been cheaper during that time - as investors chase after yields assets go up in value:

https://fred.stlouisfed.org/series/MORTGAGE30US

If people could extract yield from savings accounts people would leave their money in the bank.

In 2000 you could get 5% annual return from your savings account - but during the last 20 years you would have been better off buying stocks or real estate.

When rates went to zero, capital chased after yield: housing, stocks, NFTs

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

#123

Post by ethbr0 »

actionablefiber wrote: post #87
ethbr0 wrote: post #44

Earlier quoted context omitted.

I'm not in zoning, so no idea if this is already done, but it would be great to have a (probably national-level) standardized formula for calculating a transit credit for a development that could be applied to decrease required parking spaces. I.e. having a light or heavy rail stop within 2 miles gives an X credit, having a grocery or mixed use commercial (food and services) within 2 miles gives a Y credit, having bi…

Why not just abolish parking minimums so that car-free neighborhoods are legal to build from the get-go?

Because then everyone would always build no-parking developments to maximize profit, even in neighborhoods unsuitable for it. E.g. no public transit, no nearby grocery store.

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

#124

Post by yes_really »

Honestly I'd rather have developers build 1,000,000 luxury houses than 100k luxury + 900k "affordable" houses. In the long term high-income people will live in the best houses, and if there aren't enough luxury houses, then they will just live in simple houses and those houses will increase in price because of all the demand of high-paying renters/buyers and the good school districts.

That's what we have in the Bay Area - $3,000,000 houses in Mountain View that working class people used to live a few decades ago. And now working class people are priced out of even those simple houses. Nobody wins.

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

#125

Post by ghaff »

gernb wrote: post #101
ghaff wrote: post #74

Earlier quoted context omitted.

Are you suggesting that a pleasant rural/exurban environment, perhaps within a reasonable driving distance of an urban downtown is not quality of life focused? It may not be your preference but it is for many people. Others even like suburbs though that's mostly not my thing.

That's fine if people want to live in the suburbs but... They need to start paying the full amount of what it costs to maintain those suburbs. As it is, the dense urban downtown is subsidizing all of it. That's not fair. https://youtu.be/7Nw6qyyrTeI

It's by no means a straightforward question.

It's not like a city exists in some impermeable bubble from the surrounding area. A great deal is shipped into a city through the suburbs and other surrounding area. Many workers commute in from suburbs which are often cheaper than the city even though they may have better school systems (even though the per student costs are often lower). Food comes in from generally more rural areas.

Cities and especially their denser and more walkable areas are dependent on the surrounding area in many ways. More dependent than the suburbs are on the city except perhaps for employment.

There's a reasonable argument to be made that while San Francisco was the original primary catalyst for development in the Bay Area, Silicon Valley (which is effectively suburban sprawl) would be just fine without the city at all. The same would have been true of the Boston area to a large degree especially 20 years or so ago, except perhaps for the universities.

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

#126

Post by ethbr0 »

gernb wrote: post #101
ghaff wrote: post #74

Earlier quoted context omitted.

Are you suggesting that a pleasant rural/exurban environment, perhaps within a reasonable driving distance of an urban downtown is not quality of life focused? It may not be your preference but it is for many people. Others even like suburbs though that's mostly not my thing.

That's fine if people want to live in the suburbs but... They need to start paying the full amount of what it costs to maintain those suburbs. As it is, the dense urban downtown is subsidizing all of it. That's not fair. https://youtu.be/7Nw6qyyrTeI

That seems like an incomplete accounting though, as it's looking at net revenue per acre.

When in reality, the productivity of an acre (and therefore its tax revenue) depends on that acre + all its inputs (people, services, etc).

Downtowns (aka central business districts) look wildly productive, but they're fueled by people who live... not there.

From this perspective, it's really more of a call for mixed use development [0], which is able to supply more of its own requirements AND benefit from locality.

[0] https://m.youtube.com/watch?v=7Nw6qyyrTeI&t=6m53s

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

#127

Post by [deleted] »

returningfory2 wrote: post #79
zbrozek wrote: post #23

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…

In the book The Affordable City [0], this is illustrated with a really powerful analogy: Every year in the United States, the Toyota motor company sells about 2 million regular Toyota cars and 300,000 expensive luxury Lexus cars. Suppose that we introduced a law that each motor company can only sell 300,000 cars a year. Which cars would Toyota continue to make? [0] https://islandpress.org/books/affordable-city [1] ht…

[deleted]

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

#128

Post by lupire »

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.

At some point that can't keep being true.

And houses generally have gotten far larger over time.

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

#129

Post by actionablefiber »

ethbr0 wrote: post #123
actionablefiber wrote: post #87

Earlier quoted context omitted.

Why not just abolish parking minimums so that car-free neighborhoods are legal to build from the get-go?

Because then everyone would always build no-parking developments to maximize profit, even in neighborhoods unsuitable for it. E.g. no public transit, no nearby grocery store.

Market dynamics would solve for this pretty quickly. If a neighborhood of no-parking developments had no grocery store, then building one would be a blindingly obvious opportunity. If the neighborhood is actually incorrigibly unsuitable for zero parking, then developers would have to build parking to attract buyers. But if you mandate parking minimums based on a formula then you have absolutely no mechanism for A) discovering how much or how little parking is actually required in each neighborhood (only top-down prescriptions based on a system that may or may not reflect the reality on the ground), and B) you categorically shut out the scenario where a neighborhood densifies before the commerce/transit is there for it, which then in turn attracts commerce/transit to move in and meet the demand.
Post reply on HN