Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Making housing more affordable means your home's value will have to come down

theglobeandmail.com

Post reply on HN
Print view View original

51–60 of 192 posts

Re: Making housing more affordable means your home's value will have to come down

#51

Post by hammock »

factorymoo wrote: post #29
dibujante wrote: post #2

Not necessarily. If you add density to an existing lot, your land increases in value, and since it’s likely the majority of the value of your property, your property probably goes up in value. Then, the increased supply decreases the cost of shelter.

> your property probably goes up in value. > decreases the cost of shelter. Which is it?

Lot A has 1 single family unit. Land: 300K. Building: 600K. Total per unit 900K

You subdivide and build another house on the lot with building value 300K. Total land value appreciates 50K.

Outcome

Unit 1 land 175 + building 600, total 775 (and the owner gets 175 for the land they subdivided and sold off , coming out ahead 50k in cash)

Unit 2 land 175 + building 300, total 475.

Average unit cost on the lot is now (775 and 475) = 625 (30% decrease)

Re: Making housing more affordable means your home's value will have to come down

#52

Post by s1artibartfast »

dudul wrote: post #28
r0ckarong wrote: post #20

I really don't give a shit about the financial value of my home to someone else. Sure, my mortgage is calculated on it and I'll be paying that for the rest of my life but the true "value" of my home is the quality of life my family and I can enjoy here. What you're talking about is how much money some investor can make off of the desire of people to have this quality of life value for themselves. And quite honestly i…

The only reason I care about the value of my house is to know what I can get out of it if i need to move. If my house goes down in value but the trend is roughly general then I don't care indeed.

This position makes sense if you own outright, but changes significantly if you have a significant mortgage based on the purchase price.

Re: Making housing more affordable means your home's value will have to come down

#53

Post by hiddencost »

I'm not sure this is true.

My mom owns a single family home near the best park in her city.

The only way housing prices will fall in that city is if they build a massive number of affordable, high density buildings.

Which will significantly increase the population of the city, because people keep leaving for cheaper locations.

Which will significantly increase the price of my mother's house, because it'll be much harder to find a unit like hers, and there will be many more people competing for it.

Re: Making housing more affordable means your home's value will have to come down

#54

Post by mrcode007 »

throwaway1105q wrote: post #25
grecy wrote: post #18

This is so fundamental to the issue. It is impossible for housing to be simultaneously a good investment and affordable. Policymakers simply have to decide if they cater to those that already own homes, or those desperately wanting to buy one. I feel strongly housing is a basic human right, and so we should stop viewing residential property as an appreciating asset.

Housing can be an asset and a basic right. The rights based housing just isn't in the center of a capital city. Also, do you mean housing ownership, or just housing? People can be housed in houses they don't own too - and it's probably better if it's owned by the municipality.

An asset produces cash flow. Primary residence can only be a speculation device because for a majority of people it does not produce a cash flow. Instead it produces expenses.

Re: Making housing more affordable means your home's value will have to come down

#55

Post by [deleted] »

dudul wrote: post #28
r0ckarong wrote: post #20

I really don't give a shit about the financial value of my home to someone else. Sure, my mortgage is calculated on it and I'll be paying that for the rest of my life but the true "value" of my home is the quality of life my family and I can enjoy here. What you're talking about is how much money some investor can make off of the desire of people to have this quality of life value for themselves. And quite honestly i…

The only reason I care about the value of my house is to know what I can get out of it if i need to move. If my house goes down in value but the trend is roughly general then I don't care indeed.

[deleted]

Re: Making housing more affordable means your home's value will have to come down

#56

Post by xhkkffbf »

There's little discussion about immigration. Canada has an even higher rate of immigration than the US and, no surprise, is watching housing prices spiral even higher.

If you build X affordable units, but let it 2X or even 1.1X new residents, the prices are going to go up.

The YIMBY types tend to be in love with unconstrained immigration. Unfortunately, more people means more competition for housing.

Re: Making housing more affordable means your home's value will have to come down

#57

Post by erikerikson »

hurutparittya wrote: post #48
bilsbie wrote: post #35

I think non affordable housing makes values come down too. Just I a less controlled way. Eventually people will just stop participating in the housing game and there’s no telling where that will lead.

Stop participating in the housing game? How? By becoming homeless?

To be fair, there are a number of people taking that branch of the decision tree

Re: Making housing more affordable means your home's value will have to come down

#58

Post by abeppu »

factorymoo wrote: post #29
dibujante wrote: post #2

Not necessarily. If you add density to an existing lot, your land increases in value, and since it’s likely the majority of the value of your property, your property probably goes up in value. Then, the increased supply decreases the cost of shelter.

> your property probably goes up in value. > decreases the cost of shelter. Which is it?

They're claiming we can see both, because the number of people sheltered per unit of land will have increased.

While I see this as plausible in some cases, I also think it's sweeping a big error constant into "housing affordability" if we're saying that the kind of housing "affordable" to one generation is of a different kind than was realistic for the preceding generation. If your parents could afford a single family home with a yard and you can afford an apartment in a building put up where someone's single family home used to be ... surely we can agree that actual housing affordability meaningfully decreased?

Re: Making housing more affordable means your home's value will have to come down

#59

Post by bee_rider »

I can’t really imagine wanting to own a house nowadays, given how unstable everything is. I’d rather buy an RV or something like that.

Using home equity as a long term store of value seems nuts, what if your town turns into the next Florida (uninsurable hurricane and flood zone).

Re: Making housing more affordable means your home's value will have to come down

#60

Post by everforward »

CuriouslyC wrote: post #3

Why do new homes have to be built in competition with existing homes? With remote work and the digital elite moving wherever, why not just pop up new developments wholesale, complete with shopping and services somewhere out of the way and cheap?

If someone could predict what shopping and services would do well in a neighborhood with any accuracy, they would go work for Target or Walmart or a hedge fund.

How are you supposed to predict what to build before anyone moves in? A grocery store is easy, but the hipster main streets that people love are hard to nail down. What stores are going to seem “eclectic” and “cute” to the people who move in, without being too far out there or too “corporate”?

How many bars? What kind of bars? Is the coffee shop fine or does it need some kind of fancy tea time place?

What price point should these places target?

All of this is very hard to know without having people living in the houses who can be polled or observed to see what they’d want.

Post reply on HN