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What Happens to Home Prices When Technologists Come to Town

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Re: What Happens to Home Prices When Technologists Come to Town

#31

Post by lobe »

meesterdude wrote: post #6

> When I bought my first house, using money earned from co-founding a software company, I couldn’t believe that such abstract work could be exchanged for something so big and tangible, hewn from forests and rocks by people sweating in the sun. I've been writing software for years, and it still feels like magic. People work 3x as hard as me and I make 3x as much as them. Many make real, physical things; i just type aw…

I definitely had the eureka moment when I was younger. When I was in high school I worked with my sister to sell t-shirts that we designed online. The shirts were designed in photoshop, designs given to our supplier who printed them on demand to ship directly to our customers. Shirts were listed on eBay, payment made through paypal or direct deposit, and all communication with customers and suppliers was through email. At no point did we touch the product or even have a phone call with anyone.

After a couple of months we took out our first profit, which I think I spent some of it on an ipod classic. I was 14, and through clicking buttons and moving my mouse I now had an ipod in my hands that was all mine. That was magic.

Re: What Happens to Home Prices When Technologists Come to Town

#32

Post by kansface »

geebee wrote: post #12

It's still an open question as to whether this will cause San Francisco level problems. It may turn out to be a very good thing in moderation. I think people forget that until very recently, San Francisco was actually rather fond of its tech industry. It was viewed as a creative, slightly quirky, and generally positive culture that fit right in. Tech is actually a pretty good industry to have around. Supposedly tech…

> It's still an open question as to whether this will cause San Francisco level problems

SF's (SV's) problem is that it refuses to build houses commensurate to the number of people who move there. Any number of well paid jobs from any industry would have caused the same problem. High paying (middle class) jobs (outside of manufacturing) are not a problem.

> If this just means that tech is finally spreading out a bit

For better or worse, the exodus of tech companies out of SV could have been prevented. The valley could have captured nearly the entire industry if it just built more houses. Billions (likely trillions over the course of a few decades) of dollars will not flow into the local economy.

Re: What Happens to Home Prices When Technologists Come to Town

#33

Post by dragonwriter »

xux wrote: post #21
stephengillie wrote: post #19

Earlier quoted context omitted.

It embarrasses me that less physical effort grants me a more valuable reward. This probably just reflects my laborer upbringing. I put together a few lines today that automates a 5-minute process. Across the scope of a few thousand servers, this obviates about 6.25 weeks of labor. It really does feel magical.

> It embarrasses me that less physical effort grants me a more valuable reward Why? Just because you work hard doesn't mean you deserve more

> Just because you work hard doesn't mean you deserve more

Its a major element of the ideology associated with the Protestant work ethic, which has an important role in American culture -- and ties intimately into the way large parts of the more successful population can dismiss the less successful as being so as a result of choice and moral failing -- that hard work both does, in fact, and should, in moral ideal, result in material success.

Even lots of people who intellectually reject the position are have been to some degree socialized in it and feel some dissonance when contrary facts are particularly palpable.

Re: What Happens to Home Prices When Technologists Come to Town

#36

Post by jsuar »

dragonwriter wrote: post #30
chiph wrote: post #27

People in Austin are saying it's a bubble. But it isn't - a significant number of homes are being paid for in cash. Often $10-20k over the asking price. Those that are being financed have fairly solid support behind them (20% or more being put down). It's not a bubble - it's supply + demand in action. Which means that housing will be tight until the builders can catch up. Unfortunately, Austin's roads and other infra…

Bubbles are supply + demand in action, but where the demand is driven in large part by perceived future value where the underlying fundamentals to support that future value do not exist. That homes are being paid for in cash doesn't indicate that there isn't a housing bubble -- it does mean that if there is, its not likely significantly an effect of a mortgaged-backed-securities bubble the way the pre-2009 national h…

The question becomes, if there is a bubble, what could make it pop? Tech jobs leaving the area and not creating salaries that support existing house prices?

Re: What Happens to Home Prices When Technologists Come to Town

#37

Post by russellhealy »

stephengillie wrote: post #19
meesterdude wrote: post #6

> When I bought my first house, using money earned from co-founding a software company, I couldn’t believe that such abstract work could be exchanged for something so big and tangible, hewn from forests and rocks by people sweating in the sun. I've been writing software for years, and it still feels like magic. People work 3x as hard as me and I make 3x as much as them. Many make real, physical things; i just type aw…

It embarrasses me that less physical effort grants me a more valuable reward. This probably just reflects my laborer upbringing. I put together a few lines today that automates a 5-minute process. Across the scope of a few thousand servers, this obviates about 6.25 weeks of labor. It really does feel magical.

But how many hundred, or thousand hours did it take for you to learn enough to be able to write those few lines?

Re: What Happens to Home Prices When Technologists Come to Town

#38

Post by serve_yay »

eclipxe wrote: post #23
serve_yay wrote: post #11

It's a very discouraging time to try to buy a home in Portland now. I can't really figure out what to do about it.

What is the market like there?

Insanity. When I was out looking a few weeks back, my realtor got a call from another realtor who had just closed on a house for $402k, which had been listed at $365k. Lots of people getting blown out by all-cash offers. Every house you look at, the sale history shows it was bought in 2014 for $172k and it's on the market for $300k, a lot of that sort of thing. I looked at basically a dilapidated shack that was $300k because it was near the New Seasons on NE 33rd.

I waited until I had a full 20% to get in the market, turns out I should have bought earlier because the 20% isn't going to help me now anyway given the all-cash offers out there. From what I have heard, a lot of this is due to foreign capital looking for a value store. But I also think this will just continue and get worse, as people in the Bay area look at the quality of life in Portland, compare housing prices, and conclude (rightly IMO) that the move is a no-brainer.

Re: What Happens to Home Prices When Technologists Come to Town

#39

Post by ChuckMcM »

manyxcxi wrote: post #17

If we were having a gold rush we'd be complaining about miners driving up prices. The tech sector is no different in that regard. I like the correlations they've drawn to the performance of individual companies, etc. but to promote the idea that these companies are any different from any other company in any other industry that would be going through the same growth is a bit off target in my opinion. What would be in…

There was an article about that in the economist (http://www.economist.com/news/united-states/21644164-gentrif...) which basically said the economic indicators for an area are better for everyone when this happens.

Re: What Happens to Home Prices When Technologists Come to Town

#40

Post by meritt »

serve_yay wrote: post #38
eclipxe wrote: post #23

Earlier quoted context omitted.

What is the market like there?

Insanity. When I was out looking a few weeks back, my realtor got a call from another realtor who had just closed on a house for $402k, which had been listed at $365k. Lots of people getting blown out by all-cash offers. Every house you look at, the sale history shows it was bought in 2014 for $172k and it's on the market for $300k, a lot of that sort of thing. I looked at basically a dilapidated shack that was $300k…

St Johns. Lents. Milwaukie. East Portland. SW Portland (Markham, Terwilliger, Multnomah Village)

There's some good deals out there still but yeah.. in the same boat as you. I'm working on compiling historical pricing on a neighborhood basis so I can focus my attention on areas that haven't been seeing 10%+/yr gains. West Hills, for instance, homes have been appreciating only about 3%/yr. Of course those were way out of my budget to begin with...

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