561–570 of 1001 posts
My refrain remains: housing cannot be both affordable in perpetuity and a good investment. These are mutually exclusive goals. Let people build.
Earlier quoted context omitted.
I know this is anecdotal, but whenever I hear these stories, I'm curious about the details. A quick search leads me to believe that head chef pay in Seattle typically ranges from about 90k-110k per year. Finding apartments off Broadway in Cap Hill, I can see that studios, though relatively expensive, range around $1.5-2k a month. An income tax calculator estimates about a 22% total tax bracket and a monthly adjusted…
I think 33% is very high. Also converting the value to % erases the fact that this is still a very high price for what you get in return. Perhaps it’s time to reevaluate the economics around housing - maybe betting against human lives doesn’t feel right. Also, with overpopulation and climate changes, access to housing and the need for relocation will drastically change the landscape of what one needs to do to put a p…
This is an inappropriate emotional appeal. Real estate is dependent upon the price/value of labor. It's betting for/against labor prices.
Labor is not your life. You are more than your job.
That implies housing has risks. Since 2009, that risk has been eliminated by the FED owning 30% of all mortgages on its balance sheet. We've nationalized housing risk and privatized the gains.
Not sure if it counts as privatized when the vast majority of Americans are homeowners. The gov had a ton of programs to increase the home ownership rate over the last 50 years, they were somewhat successful. Now you have a situation where the networth of 65-70% of the population is tightly coupled to their home price. And we wonder why it's so hard to get them to vote for new housing. As Munger says, Show me the inc…
Most people are probably better off renting, especially those without a good deal of disposable income after expenses. Unexpected costs for a house just keep coming and the insurance company just laughs at you when you file a claim. My fence blew down and my sunken living room flooded in a storm and insurance classified it as a basement so it's not covered. That's been a 40k hit. I have to get trees trimmed, $3,500.…
Do you think your landlord would be fine staying in the red when all of these expenses creep up? Why wouldn't they just increase your monthly rent by 1/12th what they've spent upon lease renewal? Or is is that they actually get their Homeowner's Insurance claims taken seriously because they have n > 1 insured homes with the same provider?
A lot of this is discussed by strong towns. What is appreciating is the land underneath the house due to supply and demand. The physical house depreciates over time. They discuss numerous solutions like abolishing zoning laws as well as changing tax code to tax the land and not the value of the home. I’m still optimistic that technology will disrupt building costs and totally change our options. Imagine if we could b…
> What is appreciating is the land underneath the house
> Imagine if we could buy a 3d printed home for 50 percent of current costs.
Why would the latter make much difference if the former is dominating the price of the house?
We can already test a version of this in the real world. Home builders are building largely identical houses now as they were 10 years ago, but the houses cost three times as much. I don't believe for a minute that my builder pays 3x for the people he employes to build the homes, or the materials, as he did in 2012. I also doubt very much he's just pocketing a huge amount more profit. He's paying a lot more for land now than he did in 2012.
> Meanwhile, renters are desperate. They’re begging for housing prices not just to slow, but to fall. I have a friend who is a head chef at a decently popular bar and restaurant on Broadway in Capitol Hill, Seattle (very trendy part of town if you aren't familiar, steep commercial rent). He lives in a 400 sq ft studio and is barely, barely making it from one paycheck to the next. I am sitting on a 2.6% interest rate…
But the problem of your friend is not that you treat your house as an investment. By definition, if people "invest" in goods that can be produced at a certain price, then production should kick in and restore balance. In a functional housing market you shouldn't be able to get a better appreciation of housing than the inflation rate, except for perhaps some very limited and irreplaceble houses in the Hamptons or desi…
I may be wrong, but it seems to me like this is a simple supply/demand issue. Increase the supply. Yes, that's detrimental to those who already have homes (like me). But if I were a dispassionate judge-of-the-world, and I were weighing these two groups needs, I'd err on the side of supporting those without homes over those who have them. Also, increase the supply of SMALL homes. Why is every new house a McMansion? Wh…
This is a huge part of the problem. The issue is that there are so many fixed costs to build (permitting, utility, special taxes, etc...) that don't depend on sq ft. At the same time, all valuation is based on sq ft. This creates a huge incentive for builders to max out sq ft.
Solutions are to get all school funding from the state, streamline permitting based on pre-approved designs, give builders reduced utility hook up costs in areas that are lacking viable housing density. IOW - good luck with that problem.
Similar to the new ADU laws in CA, it would be awesome if they encouraged small communities with tiny houses and some common resources.
Earlier quoted context omitted.
I know this is anecdotal, but whenever I hear these stories, I'm curious about the details. A quick search leads me to believe that head chef pay in Seattle typically ranges from about 90k-110k per year. Finding apartments off Broadway in Cap Hill, I can see that studios, though relatively expensive, range around $1.5-2k a month. An income tax calculator estimates about a 22% total tax bracket and a monthly adjusted…
I think 33% is very high. Also converting the value to % erases the fact that this is still a very high price for what you get in return. Perhaps it’s time to reevaluate the economics around housing - maybe betting against human lives doesn’t feel right. Also, with overpopulation and climate changes, access to housing and the need for relocation will drastically change the landscape of what one needs to do to put a p…
Guess it depends on how each person defines 'what you get in return'. It seems this chef values living in a particular expensive neighborhood in Seattle, presumably close to where s/he works - and s/he values that. The smallish apartment size is the tradeoff they make.
Easily fixed with a tax system: 1) first home tax-free - the address you submit your yearly taxes on. Incentivize people to own at least one home. 2) second property you pay taxes for both homes now - no more tax free benefit since you are able to afford more than one place. 3) more than 2 properties you pay taxes for all of them times some factor 0.05*N houses. Fudge around with the factor to allow more supply for a…
> Meanwhile, renters are desperate. They’re begging for housing prices not just to slow, but to fall. I have a friend who is a head chef at a decently popular bar and restaurant on Broadway in Capitol Hill, Seattle (very trendy part of town if you aren't familiar, steep commercial rent). He lives in a 400 sq ft studio and is barely, barely making it from one paycheck to the next. I am sitting on a 2.6% interest rate…
I feel similar cognitive dissonance every time I compare myself to people I know outside of tech. Pretty much without exception, they work harder jobs than me or my colleagues with worse hours and for a fraction of the income. I don't think my observation is tied to the housing market, other than it being a vehicle to expedite the wealth gap.
The self comparison is supposed to make me feel grateful and happy about my situation, and yet I feel guilty for having the freedom and flexibility of my tech job with it's pay and all other benefits. Doubly so when I look at my son's kindergarten teacher and everything she deals with. I volunteer at the classroom to help as much as I can, which helps both me feel better about what I have, and helps the teacher and the kids.
But that cognitive dissonance / guilt is always there in the back.