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The Housing Market With Nowhere to Go but Up

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Re: The Housing Market With Nowhere to Go but Up

#31

Post by greenyoda »

repsilat wrote: post #18
greenyoda wrote: post #11

"Nowhere to go but up"? How quickly we forget the last housing bubble. If the price of housing goes up faster than the salaries of the people who want to buy it, eventually we'll get to the point where demand will drop sharply: someone with a $100K income and $100K in student debt just won't be able to get a mortgage for a $2M condo. As demand drops, housing prices will drop, and people who bought into the market at…

> "Nowhere to go but up"? How quickly we forget the last housing bubble. The title was an obvious pun, referring to the need for high-rise development (which was touched on in the article, though it wasn't the focus.)

I did understand the pun, but most of the article was actually about how quickly the prices in the area were rising, how people were paying rapidly increasing amounts of money for crappy real estate, how they were offering cash payments, payments above the asking price, etc. In other words, he was writing about a real estate bubble.

Re: The Housing Market With Nowhere to Go but Up

#32

Post by rwmj »

kiba wrote: post #4

At the end of the day, the solution is straightforward and clear: build more houses. The only problem is that humans in SF don't want more houses, especially high rise housing.

The solution is also "work remotely from somewhere nice". I like the short walk to my garden office every morning. In summer I can pick some fresh fruit and veg along the way for lunch.

The company I work for (Red Hat) has a huge contingent of remote workers. We work on IRC, by email and (oh the irony) Google Hangouts.

Re: The Housing Market With Nowhere to Go but Up

#33

Post by kleiba »

I just saw a report on TV about how gentrification in New York City has started to reach even the upper middle class, with young families north of $100,000 per year can no longer afford to stay in their Brooklyn neighborhood. In Manhattan, the super-rich of Russia, China, but also Europe have found a trendy place to buy luxury apartments that they then only use rarely. Not only workers, but also people with high-income jobs have started to be pushed out of the more sought after neighborhoods.

Re: The Housing Market With Nowhere to Go but Up

#34

Post by smartestone »

steven2012 wrote: post #25
dllthomas wrote: post #14

Earlier quoted context omitted.

"The best cure for high housing prices are high housing prices." Provided you have the possibility of actually building more (and/or denser) housing at a sufficient rate.

That is not necessary. If prices get so high that no one wants to or can afford to live in SF, then the prices will naturally decline. I'm old enough to be a crusty dot-com boom veteran. Rent prices were about as crazy as they were today, except it was more in the South Bay than SF, so no one appeared to care as much. My 2 br apartment in the South Bay went from $1700/month to $2300/month after the lease was up. We h…

lol at your baseless wishful thinking

Cry me a river. The demand if from millionaires an billionaires both foreign and domestic. Whatsapp made each employee a millionaire many times over. Twitter IPO. Rich Chinese & Russians. What goes up will keep going up, lib.

Re: The Housing Market With Nowhere to Go but Up

#35

Post by coops »

LogicX wrote: post #19
SamReidHughes wrote: post #12

Earlier quoted context omitted.

The companies move to where the good employees want to live so that they can hire and retain good employees. I hope that explains that for you.

Which came first? Do people want to be in SF - or are they there because there are jobs? Anecdotal, but I know people who live in SF who would rather be back in Myrtle Beach, SC - as soon as there's a similar opportunity or a remote work opportunity for them. The quality of life and work-life balance is not in SF for them. wyclif: I agree that more companies will solve this problem with distributed, remote teams - wh…

Funny to see this post pop up in a thread about how dysfunctional SF city government is. Myrtle Beach is effectively governed by an oligarchy of property development families.

Re: The Housing Market With Nowhere to Go but Up

#36

Post by josephlord »

From the title I was assuming it was going to be an article about Detroit or some other place where there really is no possibility of house prices falling because they are already at or near zero. In SF falling prices is definitely possible even if not likely in the short term.

If the acquisitions and other positive exits dry up (even for a couple of years) the prices may readjust quickly and once they start to fall the perception of inevitably rising prices will disappear taking further demand with it (people will prefer to wait for cheaper prices rather than buying urgently before prices rise further).

I am not predicting immediate falls by any stretch but when people start saying prices can't fall is when people buy on that basis and are shocked and damaged when they do (which at some point they will).

Re: The Housing Market With Nowhere to Go but Up

#37

Post by enraged_camel »

steven2012 wrote: post #25
dllthomas wrote: post #14

Earlier quoted context omitted.

"The best cure for high housing prices are high housing prices." Provided you have the possibility of actually building more (and/or denser) housing at a sufficient rate.

That is not necessary. If prices get so high that no one wants to or can afford to live in SF, then the prices will naturally decline. I'm old enough to be a crusty dot-com boom veteran. Rent prices were about as crazy as they were today, except it was more in the South Bay than SF, so no one appeared to care as much. My 2 br apartment in the South Bay went from $1700/month to $2300/month after the lease was up. We h…

>>That is not necessary. If prices get so high that no one wants to or can afford to live in SF, then the prices will naturally decline.

I think you have a fundamental misunderstanding of the problem.

For people outside the tech industry, this is already becoming the case. This is why entire neighborhoods are being gentrified: middle and lower-middle class can no longer afford to live there.

Tech workers though? Their companies have bottomless pockets. Google can afford to increase employee wages to keep up with increasing real estate prices. The issue is that Google employees need services like everyone else: police, firefighters, teachers, water, electricity, sewage, just to name a few. But if those service-providers can't afford to live in the city, then what will happen?

Probably this: http://imgur.com/CbyLy7O

Re: The Housing Market With Nowhere to Go but Up

#38

Post by arbuge »

The irony of it is that many of the companies in the Bay area are actually building technologies that help people to work from anywhere effectively, such as email programs, messaging apps, project management tools, video-conferencing, etc.

So in theory the problem should solve itself. If their apps really work, the pressure on Bay area real estate should ease. In practice I'm not hopeful.

Re: The Housing Market With Nowhere to Go but Up

#39

Post by impendia »

kleiba wrote: post #33

I just saw a report on TV about how gentrification in New York City has started to reach even the upper middle class, with young families north of $100,000 per year can no longer afford to stay in their Brooklyn neighborhood. In Manhattan, the super-rich of Russia, China, but also Europe have found a trendy place to buy luxury apartments that they then only use rarely. Not only workers, but also people with high-inco…

An interesting observation.

When I lived in Menlo Park, I observed that local politics (definitely including zoning regulations) were controlled by wealthy homeowners, who had a strong vested interest in the status quo.

But absentee homeowners, whose principal residence is not in Manhattan, are presumably ineligible to vote there. So it seems plausible that zoning and other local laws might tilt in favor of the renters, middle class, and others who actually live in their neighborhoods.

Re: The Housing Market With Nowhere to Go but Up

#40

Post by smartestone »

The left says we're in a housing bubble, but prices keep going up with no end in sight. They want to believe in a bubble like they want to believe in man-made global warming. Outside of the political sector the meritocracy is alive and well. The best and brightest are still getting ahead if the runaway success of snapchat, whatsapp,instagram facebook is any clue. Ambitious, high IQ people are making millions and billions in a matter of months and years through coding, web 2.0, stock market, real estate ,etc. The meritocracy, America's global influence, and the US economy has never been stronger. The left wants to believe that America's best days are behind it because they resent the success of the 1% that make America the success it is.
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