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Maybe treating housing as an investment was a mistake

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Re: Maybe treating housing as an investment was a mistake

#931

Post by HashBasher »

This problem is well-known amongst bitcoiners.

When the currency is abundant, everything becomes scarce. When the currency is scarce, everything becomes abundant.

Real estate has been monetized because the money is too abundant. The marginal cost of the next dollar is near zero, which is not the case for houses.

The demand that monetized real estate and other scarce assets will find a better home in Bitcoin. At that point, Alice will have no woes about house prices as it will go down to it's utility value. When housing is demonitized, it will once again make sense to rent if you put your downpayment in a hard money.

Re: Maybe treating housing as an investment was a mistake

#932

Post by chii »

hindsightbias wrote: post #477
gwright wrote: post #373

Earlier quoted context omitted.

I'm not so sure. There is a Planet Money episode that talks about the effect the digital spreadsheet had on accounting employment: > Thanks to spreadsheets, there are 400,000 fewer accounting clerks than in 1980, but 600,000 more regular accountants. Might something like GPT-6 cause employment to shift to higher value job responsibilities? https://www.npr.org/sections/money/2015/02/25/389027988/epis...

Developers are really dumb wanting to optimize code development.

as a programmer, i would be happy to automate myself out of a job. Because it means that the work i do is infinitely valuable, and i would have been rewarded correctly for it, in a functioning employment market.

Re: Maybe treating housing as an investment was a mistake

#933

Post by wyclif »

petsfed wrote: post #816
vel0city wrote: post #738

Earlier quoted context omitted.

Ever thought about maybe not living in California? You don't need to be on the West Coast to have a tech job.

I was living happily in Wyoming when my employer said "move to California, or find another job" which, if you don't know the Wyoming economy, translated to "leave Wyoming for us, leave Wyoming for somebody else, or go work in a coal mine".

That's interesting but unfortunate. To me, the goal would be to do just that: live in Wyoming but work for a coastal tech employer.

Re: Maybe treating housing as an investment was a mistake

#934

Post by chii »

harambae wrote: post #678
Kon-Peki wrote: post #240

Earlier quoted context omitted.

> Capitol Hill, Seattle My cousin owns a mansion in Capitol Hill. Because she was a broke-ass student at UW and couldn't afford rent. Back in the 1980s, buying a house there was seen as a crazy, insanely risky thing to do and likely to end up in death. The modern equivalent is the area around 105th and Euclid in Cleveland, near Case Western and the Cleveland Clinic. 150 years ago, that was the wealthiest neighborhood…

> But if you did, would you end up with Capitol-Hill like appreciation in 40 years??? My friend recently applied this same concept in a very rough area of South Bend, Indiana buying a house with bullet holes in the side using the same general logic ("it'll get gentrified someday"). The issue he's running into is that it turns out a city doesn't have to charge you property taxes on the actual sale price (which was onl…

> can charge you property taxes on a higher amount of their choosing

i think it should be that if they choose the price, then they must also be obliged buy at that price, in lieu of having the tax paid.

Re: Maybe treating housing as an investment was a mistake

#935

Post by hysan »

cronix wrote: post #803
narrator wrote: post #706

Earlier quoted context omitted.

[flagged]

> The reason that I think the Bay Area and other tech hubs are so expensive is that asians with PHDs who fly in for their $500k/year machine learning tech job want to live around other asians. They do not want to live in rural Utah where you can get a nice house for $200k and remote work, but there are no asians around and there's probably more discrimination. You can probably safely extrapolate that to all races who…

Another reason is the belief that there is a level of safety that comes with living with others in the same culture/religion/etc. not saying that it works out in practice, but it is something that holds some sway.

Re: Maybe treating housing as an investment was a mistake

#936

Post by Valakas_ »

nineplay wrote: post #268
photon12 wrote: post #6

> 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…

People aren't paid by how hard they work, they're paid by how much money they generate and how hard they are to replace. A head chef might be hard to replace but popular bars and restaurants are not, as we saw during Covid. They have often been replaced by people deciding to save money and eat at home. Your cognitive dissonance isn't unusual but I think it does a disservice to our ability to have productive discussio…

Firstly, cognitive dissonance is not really being used well here and I don't like it being so trivialized. What OP feels is more guilt and confusion that his friend is worse paid than him and yet has to work harder. Cognitive dissonance is holding two conflicting beliefs at the same time in a way that creates a mental toll. What happens in abusive relationships or example when a person is told "i love you" while being hurt. Or when your gut feeling tells you something wrong is happening, but you're told everything is right. Cognitive dissonance feels almost like physical pain.

And about your comment:

SW aren't well paid because of how much money they generate or how hard they are to replace.

1- I'm not sure why you say this but SW are not that difficult to replace. There's plenty of SW around for everyone.

2- What actually determines the fact that SW are so well paid is just luck and time. What do I mean by this?

2.1 The profit margins in software services are the biggest. An easy example is Amazon. Initially a simple bookstore. Then a e-commerce shop. This is what Amazon is. And yet their margins for this is about 1% and for their cloud services is about 40%. Amazon CAN afford to pay SW well not because it generates more money, but because it has huge profit margins. And why is that?

2.2 Because it just so happens tech is VERY NEW and has changed everything far too fast for the market to adapt. Consumer physical products have been manufactured and sold for decades. Agriculture is a much more essential service than SW and it's some of the worst paid industry. Their profit margins are close to zero. All the money that could be extract has been, capitalism has done a good job of making it cheap for consumers. But tech? The world of mega corporations, monopolies and duopolies, there is often no such thing.

It's not about value to the world SW provide, money SW generate or hard to replace. If you really want to talk about value to the world there are many other careers that do. SW isn't one of them. SW are just well paid, due to luck, timing of being born right now, and the fact market is very new and hasn't adapted yet, that's it. Enjoy.

Re: Maybe treating housing as an investment was a mistake

#937

Post by 4m1rk »

bdangubic wrote: post #906
bumby wrote: post #872

Earlier quoted context omitted.

Don’t you think the amount of remote work has changed that? I think part of the problem is the presumed loss aversion of moving from a $300k salary to, say, a $175k one that is remote but allows for a better standard of living (particularly for families).

You say this as if getting a fully remote job that pays $175k is easy to come by… I’d guess that most people making $300k in high-priced areas would take this paycut to $175k every day of the week and twice on sunday if they were offered

This just doesn't make sense to me. The employer can hire two instead of one while getting the same performance. Supposing we're not talking about 8+ hours timezone difference, it's much more valuable than just having someone physically in the office!

Re: Maybe treating housing as an investment was a mistake

#938

Post by aosmith »

jdminhbg wrote: post #852
khazhoux wrote: post #841

Earlier quoted context omitted.

I would rather Google and Facebook and the other mega-hire companies would build up outside the bay area, rather than continuing to pack more people in.

The Bay Area isn’t remotely “packed in.” It’s good that the state of California is starting to take steps to prevent its current inhabitants from pulling the ladder up behind them.

You are correct but the NIMBYs will stop at nothing to prevent new housing because they think it will make their homes go down in value. The market for SFHs is completely different from the market for MFHs / apartments.

Re: Maybe treating housing as an investment was a mistake

#939

Post by ashwagary »

angarg12 wrote: post #551
photon12 wrote: post #6

> 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'm a new immigrant to the US, and housing is my single biggest worry together with my work visa. Our household income is north of 300k, but housing still seems unaffordable. It might sound like whining, but we only achieve this level of income recently, so our lifelong savings are in the low 6 figures. We got no assets or property abroad, and no family that can help us to get in the property ladder. Even old, basic…

>I'm a new immigrant to the US

In your position, I would recommend renting as long as possible until house price correct in maybe 2-5 years.

There is no reason to feed the bubble on already massively inflated properties with your hard earned money.

Re: Maybe treating housing as an investment was a mistake

#940

Post by 8note »

cronix wrote: post #803
narrator wrote: post #706

Earlier quoted context omitted.

[flagged]

> The reason that I think the Bay Area and other tech hubs are so expensive is that asians with PHDs who fly in for their $500k/year machine learning tech job want to live around other asians. They do not want to live in rural Utah where you can get a nice house for $200k and remote work, but there are no asians around and there's probably more discrimination. You can probably safely extrapolate that to all races who…

> Not necessarily for racist reasons, but because it's a bit more familiar and you have [...] similar customs and social norms.

So, racist reasons?

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