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I was wondering why in my neck of the woods a small 2 bedroom has a mortgage of about $4500/mo.
The number of luxury condos in big cities has always confused me. I guess the market is dual-income couples with high salaries? Even coming from the software world, I wonder what these people do. Finance?
Earlier quoted context omitted.
Conversely, perhaps that $343k home actually shouldn’t be worth that much. In a properly functioning market (e.g. no perverse incentives to own a unit and decline to rent it instead of renting it for less money, along with genuinely unpenalized liquidity such that a long-time owner can sell and buy something different without paying utterly absurd taxes and fees), prices should tend toward the market-clearing price.…
I think it's easy to say that, until you had to build one for that price. The lot alone and hook up fees, taxes would probably hover around 1/3-1/2 of that price. Then House it self is a lot of labor to construct. Even moving the materials sometimes is very labor intensive. Plumbing, Bathrooms, Lighting, there's a lot that goes into it. Immigrant and cheap manual labor is probably what makes it affordable.
My point is that, if you remove distortions from a market, prices may go down.
This appears to be what happens when rich people that don’t need houses buy them anyway as investments. There should be laws preventing a person from owning more than three houses in the United States.
I'll try to invoke Cunningham's Law by saying: Housing is close to a perfectly-competitive market. I think the above is true, but I'd welcome counterexamples. So, the way to depress housing prices is to build more houses. _Most_ housing regulations, including making it illegal for people to own four houses, reshuffle the ownership of existing houses, and don't depress their prices. As regards that regulation: if the…
We need more places to live, at the end of the day there's no way around that.
Regulation might help though. If we regulate it so that it's harder to profit from real estate, then people will find other investments instead. This is good, because as long as real estate is a favorite investment for the wealthy, there will be a "mysterious" resistance to any efforts to lower the prices by building more houses.
I'm not an expert here, but this makes sense to me. Did I miss anything?
This appears to be what happens when rich people that don’t need houses buy them anyway as investments. There should be laws preventing a person from owning more than three houses in the United States.
So..... Now they have to permanently "rent" them (maybe from a company they have ownership in)? Maybe we should just build more houses.
This appears to be what happens when rich people that don’t need houses buy them anyway as investments. There should be laws preventing a person from owning more than three houses in the United States.
I'll try to invoke Cunningham's Law by saying: Housing is close to a perfectly-competitive market. I think the above is true, but I'd welcome counterexamples. So, the way to depress housing prices is to build more houses. _Most_ housing regulations, including making it illegal for people to own four houses, reshuffle the ownership of existing houses, and don't depress their prices. As regards that regulation: if the…
Pick any US jurisdiction (with the possible exception of Puerto Rico? I’m not very familiar with how taxation works there) and contemplate the tax implications of selling an appreciated property. Further contemplate how those implications are different for different potential buyers and sellers of that same property at the same price. Then say again that it’s perfectly competitive.
Hint: there are all manner of effects here. Capital gains. The basis step up at death. 1031 exchanges and their associated rules. Transfer fees, title fees (which is pretty close to being a tax).
(I’m not the one who downvoted you.)
Earlier quoted context omitted.
The number of luxury condos in big cities has always confused me. I guess the market is dual-income couples with high salaries? Even coming from the software world, I wonder what these people do. Finance?
> the market is dual-income couples with high salaries This is some kind of memic impossibility. It's impossible to move into a city for a high paying job AND have a partner AND the partner earning a lot too. The closest I've ever been was when my job and the relationship disintegrated at the moment the partner got such job after over 5 years of searching, and I really don't feel like trying again ever.
Earlier quoted context omitted.
The number of luxury condos in big cities has always confused me. I guess the market is dual-income couples with high salaries? Even coming from the software world, I wonder what these people do. Finance?
Often they’re not luxury, they’re “luxury,” which means 1970s shitbox with asbestos popcorn ceilings and a fresh coat of paint. Aka, it’s the price that’s luxury, not the condo.
Earlier quoted context omitted.
The number of luxury condos in big cities has always confused me. I guess the market is dual-income couples with high salaries? Even coming from the software world, I wonder what these people do. Finance?
> the market is dual-income couples with high salaries This is some kind of memic impossibility. It's impossible to move into a city for a high paying job AND have a partner AND the partner earning a lot too. The closest I've ever been was when my job and the relationship disintegrated at the moment the partner got such job after over 5 years of searching, and I really don't feel like trying again ever.
Earlier quoted context omitted.
Often they’re not luxury, they’re “luxury,” which means 1970s shitbox with asbestos popcorn ceilings and a fresh coat of paint. Aka, it’s the price that’s luxury, not the condo.
I guess it's all relative, but when I say "luxury condo" I'm thinking of $800k–$1M new construction with fancy appliances. Honestly not my particular taste. But when I see 30-somethings coming out of these buildings walking their dogs and pushing a stroller, I just can't figure out how the math works out.