That actually messes with single family home owners more. I would love to provide more housing and make more money.
I don't care. Landlords aren't "providing housing" they are just money conduits. It is demonstrably the labor of their tenants which provides the housing, and the pendulum needs to swing back in the tenants' favor for a while.
I think they are. They are purchasing an asset that others may not be able to afford and making it available. Additionally, they're funding construction of more housing wherever possible. Are tenants just money conduits for the corporations they work for?
They know that the current government planning regulations mean that getting anything built is extremely difficult. They know that due to supply and demand that this makes property a wise investment. Blame planning regulations. I read recently that Japan and new Zealand scrapped various regulations and this led to stabilization / lower of property prices. Near me, someone is sticking up protest letters at bus stops c…
Japan not so much scrapped various regulations as their regulations are just different - and nationwide. One of the effects of how their zoning classes work is that you don't have "residential-only" zones with no shops or other amenities - instead you have zones defined along the lines of maximum nuisance and with overlapping uses. You have a total of 12 zones, which start from "exclusively low rise residential" that…
Every now and then I watch one of these Japanese "video walk" channels on YouTube and find myself despairing at how wildly better their land use is than in the US.
Obviously some of that is to be expected of an island nation versus a continent-spanning one. And yet, so much of Tokyo seems like it's built at the scale of a small-town main street: Between the major roads with their skyscrapers sit networks of pedestrian-friendly streets with little shops and restaurants, often crossed by even smaller yokocho which themselves have bars and flats. Quiet side streets intermix residential buildings and even single-family homes, and yet somehow these little districts are all linked up together into the world's largest metropolis.
That’s only true up to a tipping point when poor people move in. Parts of Detroit are a great example where poor people are diving down the value of houses around them. People essentially want to be surrounded by people of almost exactly their economic class to somewhat richer. To rich and stores they can’t afford to stay ie gentrification, to poor and you have to move ie white flight.
I'm not sure what parts of Detroit you're talking about, I can't think of a single neighborhood that is struggling with that problem, blight and abandonement? Sure.
Blight is a direct result of people in the area being to poor to afford to maintain infrastructure.
As to driving prices down, some houses in good condition are selling for ~25-50k which would be worth more basically anywhere else in the US.
I chuckled at the headline because financial planners have always said that owning real estate for renting out was a more reliable source of retirement income than anything else. However, it is annoying at how some places where there is strong demand, there are few new projects going up. I personally have been amazed at how much new housing has been (and is currently being) developed in the "south bay" (which are the communities Mtn View, Sunnyvale, Santa Clara, and San Jose.
Ever since mixed commercial/residential started getting approved we've had over a dozen large re-developments of lots that were purely commercial/industrial into mixed residential / commercial. The entire AMD and former Spansion campuses have been re-done this way and produced both hundreds of new homes and several new commercial leasing opportunities. Sunnyvale's revised downtown went from 100% commercial to 50 / 50 commercial and residential. So that is pretty amazing to me.
Here's why investors buy up houses: they know your neighbors will do the dirty work of artificially constraining the housing supply, which makes it a good investment. Here's one who comes right out and explains this: > Meanwhile, local opposition to building is so commonplace and the approval process so cumbersome, time consuming, and expensive, even when a proposed project complies entirely with requirements, approv…
And, at least in California, realtors will always push prices up. It’s pretty much never in their best interest to lower the price. Even the buyer’s agent gets paid a percentage of the sale price, so if they try to lower it they’d be essentially working against themselves. And this is without even accounting for all the schemes realtors create (like listing below market to get a lot of offers and create artificially…
Some of this is changing - I've heard that Redfin agents (who are employees - they don't split commissions the way other brokerages do) get paid a bonus structure that's tiered based on list price. So at the time they show you the house, the bonus they get if you buy it is already set, regardless what you pay for it. They still do have an incentive to show you more expensive homes, but they don't have an incentive to jack up your bid during the negotiations so that they get 3% of a bigger sale price. They also get paid for a bunch of other activities (like giving tours, writing offers, typing up agent notes that you see on the website), so it's not a total loss for them if you don't end up winning the bid.
> Everybody opposed the rezoning and fought to defeat it. Why? That's kind of an important point. For example, unless this is NYC or similar, 49 townhomes is going to need a minimum of at least 110 parking spots (just to hold the occupants alone, assuming no one ever has guests ever). A realistic parking minimum should be 2.5 spots per townhouse. A lot of builders outsource their pollution to the local neighborhood,…
The developer wants to build the densest housing in four counties with little parking, and nobody has asked the real question: is this planned as Section 8/affordable housing? It sounds like it. Section 8 is guaranteed income for the landlord and probably a headache for the neighbors, especially if they had no poverty in the area before. A very similar situation happened in my rural village, where a developer decided…
I hope they appealed that ruling. Elected or appointed judge?
> Everybody works but the vacant lot. I paid $3600 for this lot and will hold 'till I get $6000. The profit is unearned increment made possible by the presence of this community and enterprise of its people. I take the profit without earning it. for the remedy read Henry George. - Billboard posted in an empty lot, Rockford Illinois, 1914
That's a common meme - that asset appreciation is unearned wealth. But it's not. That investor could've spent the 3600 on hookers and blackjack. Investors freezing their money in communities in the form of real estate or other investment is a key part of those communites becoming richer and more complex. There's a real risk of losing your money - there's no worse financial nightmare than holding real estate that you'…
Any benefit is earned with a suitable definition of "earned"...
If only so many people didn't treat land and houses like investments, there wouldn't be such a disastrous hoarding problem. Henry George's Land Value Tax [1][2] seems like an obvious economic fix that would require a large fraction of the population to change how they think about land and natural resources, but most of them are invested in such a way (i.e. owning multiple houses on multiple parcels of land, often wit…
I’ve ranted about this before but CA Prop 13 not only makes housing a good investment, but one that you’re extremely incentivized to hold onto forever and never move. Two people can be living in houses next to each other valued around 1.5m, and one of them will be paying 1/10th the tax. If anyone wants to buy a house, they have to first be able to afford the property, so the barriers to entry are so much higher for t…
Or, anyone who didn't have the foresight to be born 60+ years ago and buy land in their early twenties.
Shouldn't we do something to curb institutions making "investments" that do nothing productive except pump the bubble? Dont these institutions have am obligation to act responsibly?
The irony is that density means more people, more homes, more availability. That means more jobs open up and makes the place more lively. More desireable. That means the house property value will go up. They are thinking "will this make the property value go down in the next 5 years"? vs "will this make the property value skyrocket in the next 10 years". We are catering to short-term gains at the expense of long-term…
Look at any typical city in North America, your priciest neighborhood likely has low density. People tend to work away from where they live (at least for high paying jobs) and prefer having ample space at home therefore I don't think higher density would increase property value as you stated.
The priciest neighborhood ($2MM+) in my city is low density and full of mansions for sports stars and execs for of all the local F500 companies. But the next tier in price ($1MM-$2MM) is actually pretty high density housing abutting downtown.
Once you get into the $500-$1MM range density falls again, as these are the McMansions in suburbia. Density keeps dropping as price goes down until you get into the slums territory, which are basically the pockets of urban blight that haven't been redeveloped yet.