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Priced out of home ownership

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Re: Priced out of home ownership

#921

Post by int_19h »

ethbr1 wrote: post #836
bane wrote: post #826

Earlier quoted context omitted.

> No, lack of building _is_ the main problem. This might be one of those things where the obvious bit (built more!) is both true, and reductively incomplete. We do have a sense that just building more housing in the presence of lots of liquid capital and easy credit seems to create a speculator market -- even down to retail investors. (e.g. The China real estate bubble bursting seems to be strong evidence that this c…

I'd love to see a progressive rate purchase tax on properties. Proceeds to fund transit capital expansion. Above the median, buyers (and therefore developers building) start incurring increasing transaction costs. Part of the issue is that builders can dump luxury properties into the market, then wash their hands of future responsibility as soon as it's sold.

Why not just have a progressive property tax, and use that money to fund local infrastructure as needed?

Or better yet just tax land heavily.

Re: Priced out of home ownership

#922

Post by kerkeslager »

lotsoweiners wrote: post #879
kerkeslager wrote: post #741

Earlier quoted context omitted.

The fact that your response to real solutions is to list them dismissively underscores why we need to continue to say these things.

I think you’re missing his point that yelling the same ideas into the void (internet) ad nauseam doesn’t really help solve anything or implement these solutions. Each one of the items the poster listed are very difficult to implement and just fixing one thing isn’t going to move the needle noticeably.

What's your theory of how change happens in a democracy?

Assuming we aren't giving up on democracy, my theory of how change happens in a democracy is that it starts with changing people's minds.

Re: Priced out of home ownership

#923

Post by fragmede »

dogcomplex wrote: post #494
pfdietz wrote: post #439

Earlier quoted context omitted.

Eliminate regulations and laws limiting supply.

Or increase planning department funding with higher emphasis on throughput. It's the bureaucratic delay (nearly a year for approvals or revisions in many places) that causes much of the pain, not the regulations themselves.

The regulations themselves are what forces bureaucratic review though. Fewer regulations would mean more throughput with the same resources.

Re: Priced out of home ownership

#924

Post by fragmede »

munksbeer wrote: post #629
neilwilson wrote: post #336

Earlier quoted context omitted.

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 hous…

> Higher interest rates just mask the problem and hand more money to rich people for no effort. What higher interest rates? We're nowhere near high interest rates.

The almost 7% that the US is currently at, vs the < 3% it was at back in 2021, 2.3x as much. It's true 7% isn't high compared to a peak of 18.5% in 1981, but neilwilson said higher, not high.

Re: Priced out of home ownership

#925

Post by martin82 »

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 other words: Buy Bitcoin!

Re: Priced out of home ownership

#926

Post by fragmede »

AnthonyMouse wrote: post #583
the_gipsy wrote: post #512

Earlier quoted context omitted.

Lack of building is not the problem - on the contrary. You cannot realistically build enough so that the rents decrease. And when you build you just fuel the vicious cycle of people -> opportunities -> people.

> You cannot realistically build enough so that the rents decrease. I'm curious what makes you think this. Suppose you built twice as many housing units as you had residents. Rents wouldn't decrease? Why not? Or do you think that a sufficient amount of housing wouldn't fit? For reference, the San Francisco metro area has ~7.5M people in an area of ~3500 square miles. With housing at the population density of Manhatta…

If we magic in twice as many housing units there would be calamity and chaos, because a bunch of building magically appeared, in violation of the understood laws of physics. I doubt money would be as much of an important concern in the ensuing chaos. So sure, if we look at a supply and demand graph, and double the supply, the intersection of the two moves, meaning the price goes down.

However, we don't live in a world of perfectly spherical cows and because we don't live in a world where we can double housing units overnight, realistically the reasons we're in this problem is because we can't build enough housing units. Given than, we're not going to be able to double the number of housing units, so realistically we can't build enough to lower rents.

The reasons we can't build enough housing aren't going away overnight, so even pretending they did, it would still take many months, if not years, before new housing units were being sold. Given the time it would take to double housing supply, the natural increase in demand over time because the population is increasing means it would rise to meet supply to keep rents at the current level. Lets say demand increases by 9% each year and it takes 10 years for double the housing stock to come online. Demand is basically doubled by the end of 10 years if that 9% remains constant.

With those problems not disappearing, new housing units are going to be slow to come online, so realistically, again, realistically, because we're not going to double the housing supply, so the best (and my bias is that of being in the SF Bay Area) we can hope for is for rents to increase at a slower rate. (Aka the derivative of rents goes down.)

I just don't seeing the rents themselves decreasing, relative to inflation of money, as well as inflation of the population.

Re: Priced out of home ownership

#927

Post by chiefalchemist »

the_mar wrote: post #768
ch4s3 wrote: post #752

Earlier quoted context omitted.

> Only maybe like 5 out of 100s of apartments consistently had someone living in them. I would be highly surprised if this were true. I lived in NYC for year and the myth of tons of empty units is pernicious and just won't die. There has been a TON of research on this topic and it all points to there being a huge shortage of housing in the city. As a percentage of total housing stock vacant units make up a fraction o…

Anecdotally, my apartment building has 0% vacancy rate. And a newer building across the street has at least 10 apartments vacant for the most of the year. Anecdotally, i know quite a few boomers that own multiple properties (>3) in manhattan, some of which they rent some of which they keep vacant for when they want to come to the city I feel like at least some % of apartments in the city are visibly vacant most of th…

Or are corporate owned.

A good friend bought her Hell's Kithen flat (read: condo unit) from a Japanese company. Years ago I had another friend who worked for a company that had a sizeable place in the Village.

Anecdotal, but probably common enough.

Re: Priced out of home ownership

#928

Post by unusualmonkey »

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…

> Ask yourself, do Canada, Australia, New Zealand, the US, Britain, Ireland, etc, all have the same inability to build...

Why wouldn't they? They are relatively similar countries in many ways, any problem that one has could easily be replicated in others. For example I imagine zoning laws are all somewhat similar, favoring suburbs and strictly zoned areas vs market driven mixed use areas.

I also suspect they all have significant migration, high labor costs and high building standards.

Re: Priced out of home ownership

#929

Post by presentation »

mlrtime wrote: post #650
jltsiren wrote: post #581

Earlier quoted context omitted.

Housing affordability is qualitatively different between Europe and the US. When a European city is expensive, it's usually only the central part that's expensive. Prices drop steeply as you get to the suburbs and satellite towns. In the US, suburbs and satellite towns are more likely to remain expensive, as long as you are within a semi-reasonable commuting distance. I guess that's because the US city is more likely…

I think you are close but slightly off. EU has historically better public transit and lower sprawl allowing more price points of housing while still a "reasonable" commute. US cities are vastly larger by land size, because America is larger allowing it, added with fewer public transit options. Look at Houston, massive sprawl and some of the cheapest housing in the country.

The transit part is key for Tokyo, everyone talks about how housing supply is robust, zoning is loose, density is high and unit sizes are small; but few talk about how having 130 rail lines with pervasive express service means that there’s an enormous amount of land within commute distance.

Set this charting tool to Density, plug in Tokyo with a number of other major world cities, you’ll see the effect in the data.

https://jnolan.shinyapps.io/Population_density/

Re: Priced out of home ownership

#930

Post by orwin »

moralestapia wrote: post #678
orwin wrote: post #161

Earlier quoted context omitted.

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…

>join a group of squatters Lol, it really is true that "civilization" is three meals away from being kaput.

You know most of the time, squatters don't hurt anyone, don't make noise as its often an industrial building that's squatted, and are pretty nice communities to live in (there is an alcohol and unprotected sex issue though). Medium to large communities (often once you have children) can be problematic but it isn't the majority in western countries.
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