Priced out of home ownership • Hacker News Board

Re: Priced out of home ownership

#331

Post by brabel » Mon, May 27, 2024, 9:02 PM UTC

tmnvix wrote: post #274

People intuitively jump to the conclusion that the problem is caused by a lack of building. While more building would help, a lack of it isn't the main cause of this problem. Ask yourself, do Canada, Australia, New Zealand, the US, Britain, Ireland, etc, all have the same inability to build or is there maybe some other common cause? In my view this is symptomatic of a more fundamental issue - global asset price infla…

In Swedish big cities, prices are also ridiculously high despite investment in properties being much harder than in Australia or the US due to some strict rules regarding renting out. I live here now but lived in Australia before. Prices in Stockholm are more or less on par with Perth or Brisbane I think (i.e. crazy, but not at the completely off-the-charts Sydney prices, at least... when I lived in Sydney like 20 years ago I remember you already needed half-a-million to get just an average house... today it's like well over a million to get anything at all).

Can confirm that as interest rates went up, people just can't afford the enormous loans anymore and prices of houses (and apartments to a lesser extent as they're a bit cheaper overall) fell, up to 20% at the worst, I believe. But as soon as interest rates are expected to go down, prices already shoot up again (even while interests are still high as people and banks estimate how much they may expect to spend in the near future).

Re: Priced out of home ownership

#332

Post by secondcoming » Mon, May 27, 2024, 9:02 PM UTC

onion2k wrote: post #239

postalrat wrote: post #194

Earlier quoted context omitted.

Land is cheap but building a house is expensive. If you want more supply then you are going to need to make building more economical.

Land is not cheap in the UK.

And unless your property is Freehold, you don't own the land at all.

Re: Priced out of home ownership

#333

Post by dahart » Mon, May 27, 2024, 9:02 PM UTC

JumpCrisscross wrote: post #280

deergomoo wrote: post #243

Earlier quoted context omitted.

No-one can kick you out of your own home because they want to rent to someone they can charge more. No-one can tell you you can’t change the wallpaper in your own home, or remodel the bathroom, or get a dog. Not everything is a purely financial decision. A home is primarily a place to live, not an investment opportunity.

> No-one can kick you out of your own home because they want to rent to someone they can charge more Property tax isn’t voluntary and as exogenous as a landlord. (Also eminent domain, to say nothing of most peoples’ mortgages.) > Not everything is a purely financial decision Making the largest leveraged purchase of your life for an emotional comfort object is irrational. That doesn’t make it wrong. But it ceases to b…

You pay property tax either way, it just might be rolled into your rent. You probably have years to pay missing property taxes, while landlords will wait nowhere near that long. Eminent domain is only exercised rarely, and doesn’t even compare to how often rents are increased, or how often people are evicted.

Re: Priced out of home ownership

#334

Post by _DeadFred_ » Mon, May 27, 2024, 9:03 PM UTC

shuckles wrote: post #322

screye wrote: post #304

Earlier quoted context omitted.

Both are band aids for the real problem. Housing can't both be an investment and a basic need. You need to pick one or find an opinionated middle ground. If housing is an investment, then remove all protections and open up the supply. No height regulations, no minum parking regulations, no mandatory HOAs. No moratoriams or legal protections when loans default. If housing is a need, then regulate it like a limited res…

> Housing can't both be an investment and a basic need. Yes it can, and it was for large chunks of the 20th century. Imputed rent can have high yields and therefore imply good "investment" income for households with long term stable housing demand.

And for large chunks of the 20th century family farming fed the nation. Not sure what the 20th century has to do with the issue at hand.

Re: Priced out of home ownership

#335

Post by linguae » Mon, May 27, 2024, 9:03 PM UTC

FactKnower69 wrote: post #310

tmnvix wrote: post #274

People intuitively jump to the conclusion that the problem is caused by a lack of building. While more building would help, a lack of it isn't the main cause of this problem. Ask yourself, do Canada, Australia, New Zealand, the US, Britain, Ireland, etc, all have the same inability to build or is there maybe some other common cause? In my view this is symptomatic of a more fundamental issue - global asset price infla…

1000%. I will never get tired of teaching people (it's news to every single one of them!) that at any given time, there are more than 20 empty housing units in the United States for every single homeless person on the street ( https://www.self.inc/info/empty-homes/ ). There is not , nor has there ever been , anything resembling a "housing shortage". We live in a post-scarcity world as far as housing is concerned, and…

I’m curious about how these empty homes are distributed? Take California for example, where there are 19 empty homes per homeless person according to the link provided. But where are these empty homes in California? If they are disproportionately located in areas far from employment opportunities, then this suggests that we still need to build more housing near employment centers. But if there are plenty of vacancies in areas close to job centers, then this is definitely something that needs to be looked into more closely.

Re: Priced out of home ownership

#336

Post by neilwilson » Mon, May 27, 2024, 9:03 PM UTC

tmnvix wrote: post #274

People intuitively jump to the conclusion that the problem is caused by a lack of building. While more building would help, a lack of it isn't the main cause of this problem. Ask yourself, do Canada, Australia, New Zealand, the US, Britain, Ireland, etc, all have the same inability to build or is there maybe some other common cause? In my view this is symptomatic of a more fundamental issue - global asset price infla…

The issue is always lack of building. Higher interest rates just mask the problem and hand more money to rich people for no effort.

The problem is that the private housing production system responds to increased credit availability only at the margins and does not over produce. That’s largely because houses are still hand built and not really substitutable like a vehicle. You don’t generally have a choice of two houses on the same site.

However if you produce houses publicly then you can force private housing to compete outside the margins. At which point you get excess supply, as we see with cars and then house prices start to stabilise and even depreciate. At which point the “investment” hoards would start to liquidate.

We need the housing market to behave like the production car market, not the classic car market.

The fix is public policy producing housing in order to force a situation of excess supply.

Re: Priced out of home ownership

#337

Post by aegypti » Mon, May 27, 2024, 9:03 PM UTC

FactKnower69 wrote: post #310

tmnvix wrote: post #274

People intuitively jump to the conclusion that the problem is caused by a lack of building. While more building would help, a lack of it isn't the main cause of this problem. Ask yourself, do Canada, Australia, New Zealand, the US, Britain, Ireland, etc, all have the same inability to build or is there maybe some other common cause? In my view this is symptomatic of a more fundamental issue - global asset price infla…

1000%. I will never get tired of teaching people (it's news to every single one of them!) that at any given time, there are more than 20 empty housing units in the United States for every single homeless person on the street ( https://www.self.inc/info/empty-homes/ ). There is not , nor has there ever been , anything resembling a "housing shortage". We live in a post-scarcity world as far as housing is concerned, and…

A surplus of housing in Madison, WI is irrelevant to someone living and working in NYC, which has a severe housing shortage.

We are still subject to space time.

Re: Priced out of home ownership

#338

Post by whoknowsidont » Mon, May 27, 2024, 9:04 PM UTC

csallen wrote: post #283

whoknowsidont wrote: post #196

Earlier quoted context omitted.

That's not the problem at all. Stop allowing people to buy multiple homes. Stop allowing landlords to "collaborate" on prices.

How is restricting supply not a problem? The fewer houses there are to buy, the higher prices will get, because there are more people competing for less.

Because the U.S. doesn't actually have a supply problem, despite this often getting repeated.

U.S. construction of homes has actually kept up with population growth and moves, by every conceivable metric.

What IS happening though is that landlords (private and corporate) "warehouse" units constantly to artificially restrict supply and demand, and they do it in collaboration with each other.

Every single city and state in the U.S. has a vacancy problem. We DO have both houses and apartments that are ready and able to be rented and owned.

The problem is simply the price, and the prices aren't being driven by legitimate supply and demand.

You can see this effect happen where prices increase NOT to match population (and often in SPITE of it), but they increase to match the upper bounds of regional income.

You need a place to live more than landlords need a few months of rent. This strategy to prevent downward price pressure from the market allows them to justify the current prices while setting up a "baseline" for the next few years.

Some free reading:

* https://www.construction-physics.com/p/is-there-a-housing-sh...

* https://reventureconsulting.com/the-myth-of-the-us-housing-s...

* https://charleshughsmith.blogspot.com/2023/08/the-problem-is...

Re: Priced out of home ownership

#339

Post by jayski » Mon, May 27, 2024, 9:04 PM UTC

FactKnower69 wrote: post #310

tmnvix wrote: post #274

People intuitively jump to the conclusion that the problem is caused by a lack of building. While more building would help, a lack of it isn't the main cause of this problem. Ask yourself, do Canada, Australia, New Zealand, the US, Britain, Ireland, etc, all have the same inability to build or is there maybe some other common cause? In my view this is symptomatic of a more fundamental issue - global asset price infla…

1000%. I will never get tired of teaching people (it's news to every single one of them!) that at any given time, there are more than 20 empty housing units in the United States for every single homeless person on the street ( https://www.self.inc/info/empty-homes/ ). There is not , nor has there ever been , anything resembling a "housing shortage". We live in a post-scarcity world as far as housing is concerned, and…

so could this be resolved by having a high tax (~50%) on second/rental/investment homes?

Re: Priced out of home ownership

#340

Post by ProllyInfamous » Mon, May 27, 2024, 9:04 PM UTC

orwin wrote: post #161

speeder wrote: post #104

I live in Portugal and here the situation is outright ridiculous. 1. There are a ridiculous amount of abandoned properties, when I walk the streets of major cities, sometimes more than half of the buildings even in expensive areas are boarded-up. 2. Meanwhile I am afraid of being homeless soon, I lost my job recently, and the unemployment benefit I can receive is literally half of my rent. Thing is, there is no "wors…

I'm sorry to recommend you that, but i have experience with homelessness. You have two temporary solutions: - join a group of squatters (hopefully you already know someone) until you get your bearings. The less ideological ones often squat old industrial properties, or long-abandoned houses (its rough in winter, but in Portugal you should be fine). You might meet some Urbex guys, they're nice and always fine with fin…

I recently kayaked a stretch of the Tennessee River, between state parks, and within an hour of paddling I passed both a homeless riverside "tent city" [technically "public camping" on TWRA/state land] and then the most-expensive house for sale in our entire metro area (just around the same peninsula).

These inholdings, both impoverished and not, were each having their respective parties (cheap beer in common) along the lakeside. Titties abounded - "howdy neighbor" - the no-betterness of being "commoners, enjoying this day upon the lake."

Interestingly, the poverty beach camp seemed to be having more fun; but obviously the multi-million $$$ homeowners are in much easier/better situations (likely).