The irony is that the influx of millions of foreigners to urban areas increases the demand for existing housing stock whilst the same people who are for millions of immigrants are against new housing built. The price pressure will only be upwards and benefits the existing landlords (and the big funds who own property like Carlyle and BlackRock and are big political donors).
I think the positive net affect of immigration on the economy far outweighs any negatives associated with it.
The response was specifically about housing costs. Nothing at all to do with other negative or positive externalities.
> But it's hard to see evidence of much political will to solve these problems. Disagree. The YIMBY movement is picking up steam in a big way. Here in Oregon, we re-legalized 4-plexes in our cities and the woman responsible, Tina Kotek, is now our governor. She's pushing another big housing bill. Our mayor in the city I live in regularly attends our YIMBY group meetups. It's gotten bad enough in enough places that th…
I mean good luck but the YIMBY movement is a very pro investor movement. Decrepit old SFH selling for $1.6 million turned into a 4 plex here in Vancouver would see each unit in the 4 plex selling for $1.4+ million (maybe $1.1 for the basement suite). Friend bought in a converted old place 780 sqft attic suite $940k. It doesn't really make stuff affordable. It was sold here as "the missing middle" and they basically d…
New homes are going to be built at market prices. The market prices are high, but the new homes will push them down.
A few years ago, $800k homes were consistently opposed on the basis that they aren't affordable to anyone, so not many were built. Now because so few were built, houses cost $1.6M.
Will we repeat the same mistake, and oppose $1.4M homes on the basis that they aren't affordable?
In 10 years we might be having the same discussion about $3M homes.
>Even if the low income families can't buy the new units, the people who do vacate their old units and there is less demand for the unit those low income families currently occupy. You're making the mistake I mentioned, confusing demand for actual housing with demand for real estate. It will indeed marginally depress demand for housing, but capital can step in and absorb the marginal supply, for rental or other purpo…
I ask this not to argue, but in the hopes that I might learn something: > As long as there is more demand from capital than supply, real estate prices will stay high even if actual demand for low-income housing remains stable or even declines. Wouldn't this be true of just about any good? I agree that an unregulated increase in supply is likely to result in increase of properties purchased for use as a rental propert…
I think the gist of it is that real estate prices are driven by the average, while homelessness is driven by the median. In a static system where everyone's level of wealth is frozen, then increasing housing supply would trickle down as you suggest. In reality, average wealth is increasing as fast or faster than housing supply can be added. If new wealth were more or less evenly distributed, this wouldn't be a big problem ("a rising tide lifts all boats!"), because the median wealth would move roughly in step with the average. But it isn't. Over time, a steadily increasing fraction of new wealth is captured by people who are already wealthy, meaning that an increasing fraction of homes are owned by the wealthiest X% of the people, and an increasingly large proportion of the population must rent. And because, unlike most consumer goods, housing is not an option (ie, the market is inelastic), rental prices are constantly driven toward the limits of tolerance. So we see a greater and greater share of most peoples' income going toward housing, with the accompanying economic and social stress that creates, including homelessness.
Buy a "starter house" and begin to build equity. It's how people have always done it. You buy a really small house that isn't in the most desirable location and start making payments into it. Down the road you have built equity and you can sell your starter home and buy a nicer, larger house. You maybe have some family to support then and need more room. But you see young people renting for 15 years in expensive plac…
This is also, IMO, part of the problem. As you “move up” more and more undiversified wealth is tied up in your illiquid “investment” leading to overly protectionist policies. Imagine if 70% of Americans invested their wealth in, I dunno, IBM. Don’t you think that’s going to incentivize some crony policies?
A house/property isn't as illiquid as you think. You can take out loans against it and invest those, often at below or near inflation rates and very often below average market returns. The equity in a home is collateral for more property, investments, etc. I can't sell it on the stock market in an instant, but I can use the equity in my properties for a ton of things.
In a well-functioning city, a head chef should be able to comfortably afford to rent a 2-3 bedroom apartment within walking distance of their restaurant. They should not be spending 1/3rd of their income and only getting a studio out of it.
When, and in what city, has that ever been the case? I haven't been to Seattle, but in major cities space is at a major premium and many dwellings are tiny. This is offset by the amenities living in a prominent city have to offer.
Why does it matter if it’s ever been the case? Is that adequate justification why things shouldn’t be some way?
You're basically saying "it's fine because that's the way it has always been," which I don't think I need to explain is not a particularly compelling argument.
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 spend an inordinate amount of mental energy calculating how we can jump into the property ladder as quickly and safely as possible You buy a cheap house far away from where you work, and rent it to someone. Let them pay your mortgage and before you know it, you've got enough equity to put towards another house. Rinse and repeat.
This sounds like the kind of high risk gamble that relies on prices continuously going up to work out. It might work out for some and hit it big, or the market can go belly up and leave you in ruin.
I'm also a bit weary of having to manage properties in far flung locations. I rather use a property manager, who would eat into the profits.
> I spend an inordinate amount of mental energy calculating how we can jump into the property ladder as quickly and safely as possible You buy a cheap house far away from where you work, and rent it to someone. Let them pay your mortgage and before you know it, you've got enough equity to put towards another house. Rinse and repeat.
This sounds like the kind of high risk gamble that relies on prices continuously going up to work out. It might work out for some and hit it big, or the market can go belly up and leave you in ruin. I'm also a bit weary of having to manage properties in far flung locations. I rather use a property manager, who would eat into the profits.
It's not high risk. It does not depend on prices going up. It depends on renters paying most or all of your mortgage.
It just runs itself if you get good renters. That's where you put all the time and effort upfront.
Yes it has some risk. All investments do. I answered the question about how you get on the property ladder if you can't afford local prices. There might be other ways too.
> I spend an inordinate amount of mental energy calculating how we can jump into the property ladder as quickly and safely as possible You buy a cheap house far away from where you work, and rent it to someone. Let them pay your mortgage and before you know it, you've got enough equity to put towards another house. Rinse and repeat.
This sounds like the kind of high risk gamble that relies on prices continuously going up to work out. It might work out for some and hit it big, or the market can go belly up and leave you in ruin. I'm also a bit weary of having to manage properties in far flung locations. I rather use a property manager, who would eat into the profits.
> It might work out for some and hit it big, or the market can go belly up and leave you in ruin
No different from living in a house you buy. Except what I recommended is a little safer. If you lose your local job because the local economy collapses, you're now stuck with a house you cannot sell, cannot rent, and that ties you to the area. Ouch!
With a rental far away, if that economy collapses it's already a small mortgage so no big deal. If your local economy collapses, you can move out of your local expensive rental and look for work elsewhere. Or even move into the cheap rental investment you just bought if that economy is doing well. Buying far away spreads your risk and is safer than buying to live in near your work.
Ever thought about maybe not living in California? You don't need to be on the West Coast to have a tech job.
This is the thought which comes around often. The problem is, for an intellectual, it's important to live in an environment rich with mental talent. Bay Area is the intellectual capital of the world, and while Einstein could maintain his patent clerkship and have famous physicists visit him in Bern ( http://norvig.com/performance-review.html ) for the lesser minds in another era settling on another place is a loss.
I live in Reno. A past employer insisted that I relocate from Reno to SF for a new position, so I did.
What I learned very quickly is that it's rather difficult to stay intellectually engaged when even a six-figure salary is paycheck-to-paycheck living in a studio apartment.
I moved back to Reno shortly before COVID, and since doing so I've found myself to be much more productive. The "intellectual capital of the world" can shove it.