221–230 of 238 posts
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And Miami is hot again from foreign (Russian and South American) buyers. Blocks of housing in Edgewater are razed to put up huge luxury condos. My wife (Brazilian) and I joke that we won't have to take the kids all the way to Brazil. We just need to go to Miami.
Given the way the economy has crashed, this won't go on for long.
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My hypothesis is that the China/hk dollar peg is to blame. Edit: to clarify, the Chinese yuan and hkd are pegged to the USD. The recent strength of the USD has caused problems for China ...some people thing the peg will fail. If you are one of these people and you have lots of cash in China, you want to move the money out of the country and into a different asset class. The recent weakness of the Canadian dollar has…
> People I meet seem to own 2-3 condos a piece. Everyone thinks they'll just rent them out. I think we are almost guaranteed to have a condo collapse in the near future. If you're not hung up on owning, this is a great spot to be in. I can already rent a luxury condo here in Toronto for less than (mortgage interest + property tax + maintenance) would cost me if I had purchased it. Rich landlords are effectively subsi…
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Remember that rent control only applies to buildings built before 1978, so it's not _all_ rent controlled.
It's scary to think that in 20-30 years nearly the entire available housing stock will not be covered by rent control. My landlord wanted to raise my rent 40% in one year here in Oakland until I pointed out the laws. Eventually the entire middle class will just be landless peasants again, allowed to live wherever the rich say that they can.
The middle class will not be able to afford to live in the most expensive housing markets in the country. But that's the way it's always been.
Reaffirming once again that if "nobody can afford to buy them" the actual prices start coming down. A more interesting thing for me however was that owner occupied (which is to say the person buying the house lives there) has not been growing[1]. Instead third parties are buying the houses as investments and renting them. That is a really risky strategy in a place like SF with rent controls as the floor can fall out…
Even if houses are flat its still better to put your cash into one than the bank...
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So, my impression is that the companies that pay enough that you can actually afford to think about buying in SF are the large and profitable companies... from what I've seen, vc-dependent startups pay dramatically less. Of course, most of those profitable company jobs are in the south bay, not in SF proper, but hell, if I could buy one of those mini-condos in sf for a quarter mill, I'd jump on it. I'm trying to say…
They form the same labor market though. Fewer startups puts less pressure on the price for hiring engineers. You don't have to many any assumptions about advertising dollars (the vast majority of which come from outside SV) to see how a startup slowdown will also have an impact on all engineering salaries.
Yeah. I guess two questions.
1. how much of the market for Engineers is vc-dependent startups? My impression is that they have an outsized PR footprint for the number of jobs there.
2. If I'm right that they get paid less, (which is my experience and belief, but I have no hard data to back up my assertion) are the engineers working at startups mostly just entry-level folks? (this is kind of my impression, or at least they seem to be way less experienced than folks you see at established companies, though again, I don't have hard data.)
I mean, inarguably, it will have some effect, but how much depends a lot on those two factors.
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This plays out daily in hot real estate markets. I've been casually observing the Boston/Cambridge market and I have to scratch my head when I see properties on the market for only a few days and agents demanding offers by 2 days after the open house. Typically, I see listed on Thursday, OH Sat/Sun, offers due Tuesday evening. If I were a seller I'd think that we priced the property too low, then again I can imagine…
As mountineer22 points out, this is a strategy to concentrate serious offers and play them against one another. The lower you set the price, the more initial interest you get, the greater chance two or more potential buyers get excited. With competitive bids, you can find the true 'market' price pretty quickly. In a hot market this apparently works well. Anecdotally, when my wife and I were looking for our eventual h…
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Even if houses are flat its still better to put your cash into one than the bank...
bank - liquid asset house - illiquid, with maintenance, property tax, and insurance costs
What I think is kind of ridiculous are all the benefits for second homes and beyond. IMO, if you're wealthy enough to afford a second home, you don't need any more government subsidies; all the benefits should go to people who don't yet have a place to live that they own. I can definitely see how this would be a very unpopular opinion among those with lots of potential money to lose if they could not keep the lower classes of people renting the property which they bought a lifetime++ deed to at a one-time cost.
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> People I meet seem to own 2-3 condos a piece. Everyone thinks they'll just rent them out. I think we are almost guaranteed to have a condo collapse in the near future. If you're not hung up on owning, this is a great spot to be in. I can already rent a luxury condo here in Toronto for less than (mortgage interest + property tax + maintenance) would cost me if I had purchased it. Rich landlords are effectively subsi…
My worry is that a day will come when rents start to increase. My great fear is that this will happen precisely when interest rates are high. What will we renters do then? We will truly have no choice then. The housing market in the UK is going through something like this now.
As a renter without much in the way of assets a high inflation high interest rate regime is really beneficial. Higher rates would mean lower prices (thus lower required deposits) and high inflation would mean quickly building equity.
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As a foreigner, I don't understand this attitude. Why would you want all your wealth to be invested in a single leveraged asset that's also depreciating, requires your constant attention and ties you to a single locale?
1. People don't understand the time value of money, or how the alternative to owning a house is owning stocks / bonds. 2. Buying a house is a form of forced savings. This can be useful because people are irrational, per Kahneman's Thinking, Fast and Slow . 3. Cultural brainwashing (I think this is the biggest factor).
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In Cambridge, a faction of candidates for city council promises that they will make housing affordable by opposing the construction of new housing. Apparently you can just tell people that supply and demand work the opposite way in the housing market, and people will believe you.
The reasoning might be that if a place gets luxury apartments, rich people will flood the area. Then the crime rate per capita goes down. The criminal population becomes diluted. It starts a snowball effect where crappy apartments in the area looks more and more attractive to the upper middle class as more upper middle class outbid previous poorer renters for the old housing.
It is not hard for a rich person to outbid a poorer renter. I mean, this doesn't require a complicated explanation. Whether or not there's new housing, rich people can already outbid current renters because they have more money.
And when this happens without new housing, not only does a rich person move in, someone else moves out. By trying to prevent gentrification from indirectly causing displacement, you just cause the displacement right away.
This still sounds like supply and demand doing what one would expect, not doing the opposite.