This seems like a very Big Coastal Metro-centric view that is probably true in those areas but doesn't capture what's happening elsewhere. Home prices in Metro Detroit, for example, used to be quite reasonable and have recently exploded to being rather unaffordable for most people. There hasn't really been any population growth to speak of, so it's not clear to me why would we need or want more housing to be constructed in order for prices to be reasonable, as was the historic norm.
The places that have cheap housing stock are usually places that are undesirable to live in because of crime, an undeserved reputation for crime, and generally pathetic government services.
Metro Detroit has low housing expenses because the government provides no services. Even if we assume low crime, if a middle class family were to move to urban Detroit, because Detroit has been deliberately designed so all the rich people live in the suburbs, that family will have no decent schools to send their kids to. So they will basically be trading their child’s education and future for a cheaper rent.
That’s almost always a terrible decision. And that’s before we consider the fact that the governor of Michigan probably doesn’t give shit about Detroit or Flint or the fact that those families are drinking lead in their water. L
Detroit was designed for rich people. Unlike almost any large city, it consists of large, single family homes, each on a relatively large parcel of land. It was a city, before "the riots," that was one of the richest in the world. Everyone had cars. There was so much entertainment that new music genres came from Detroit.
I'm finding conflicting reports about this. Some say it's been fixed for all houses in Flint, others say there's 2000 houses where it still hasn't been fixed.
But there's apparently a lot of people who simply don't trust it because they're been lied to for too long.
> The places that have cheap housing stock are usually places that are undesirable to live in because of
The leading cause for people not wanting to live somewhere is almost certainly the ability to find work (relatively) nearby. Large amounts of crime are only really a problem in sufficiently large cities (obviously with exception) and particularly poor ones, both of which stem from a lack of sustainable income:CoL ratio.
I don't think you've lived somewhere that has failing city services. One of the last places I rented for a while, the city was the only trash service. Optimistically my trash would get collected 3 times a month at best. Sometimes I was lucky to get trash picked up 2 times a month. We frequently had a "queue" of trash bags that had to be loaded after each trash day. I remember moving out and leaving a backlog of trash in the garage, simply because I had no way to dispose of it all.
And when the trash isn't collected on my day? Better bring the can in immediately, otherwise I'll get fined by the city for having my can out too long.
In the same place, the government mandated regulated power simply decided that they were not going to read my meter because of a "dog behind the gate" (there was no gate). Their solution was to have me pay an "estimated" charge that was several times my monthly income.
It's absolutely unlivable long term to be some place like that.
It's a perverse incentive providing poorer service enables more fines. Of course the cost benefit of this approach is rarely considered by the government involved.
It's separate parts of the city, at least where I was talking about. The police issue the citation and collect the revenue, not the garbage collection part of the city.
Fundamentally it's just the same thing as any other city service: they have no actual obligation to provide any service. Your recourse is to move to another jurisdiction, which I did.
Even in a cheap area in a western red state, last year, flippers bought a house, slapped a for sale sign and doubled the price the next month. Those are still sitting unsold. And now houses are being bought by flippers who are slapping an extra 2.5 times the price they got it for in the same month. None of these houses are selling. Just sitting empty.
That sort of thing should end with the end of low interest rates. When interest rates were near zero, borrowing money to purchase unused real estate could be profitable if you could sell some of it. No longer true.
Right, unless those flippers paid with straight cash, they are going to have a hard time raising more money to buy more houses, and they might go underwater on the current ones.
To see what that looks like on steroids, China's economy is at real risk of recession due to property developers running out of cash and failing to build promised developments. (Most apartments in China are purchased before construction starts, so you can buy a house and not end up with one in the end.)
The average time to flip a house is 45 days to 6 months. Let’s pretend it’s going to cost $500 more a month in interest rates, that’s only $3000 more dollars. If you could do 3 in a year you’ll only lose about $10k.
They don't have infinite money to do this, not anymore. Eventually the market's going to clear or they're going out of business.
Although in my experience people are convinced there's "vacant houses" absolutely everywhere based on not seeing the lights on at night. It's not true and this is not a major contribution to the housing crisis.
This house has been on the market for at least 15 months and has had its price slashed by over 3 million dollars and nobody is nibbling.
It's become a bit of a running joke around here, trying to guess if it's still the most expensive listing in the local paper each week.
As an aside, the local papers are really just pages and pages of real estate ads with a few paragraphs of news sprinkled here and there. Can literally rip out half the pages and not lose a single line of news.
I wish the tax on flipping houses went up. Something is sleeping there that it economically makes sense. Like if I sell 1 car, ok, but if I sell 10 I need a dealer license. Same should happen with the flippers. More regulations, because they’re cutting corners all the way.
I'm my county there are 65k people. It's also the largest county by size in Utah Iirc, in my city which is the biggest city in the county there's around 40k.
When we had to move it was horrifying and scary trying to find a place. There seemed to be no vacancies. Someone posted a listing on Facebook marketplace and there were 20 replies in under 5 minutes.
However, the are 400 apartments that used to presumably be college(we're a college town) or regular residential homes.
So the irksome thing is the fear of being homeless is very real even if you have money to move to another place, there aren't any. But there's 400 places that could be available which would raise supply if short term rentals were banned or taxed steeply enough that revenue for short term might only be 500 more per month instead of 3000 more.
This is happening everywhere not just my part of fantasia.
Under your scheme, if I own a property, it is cheaper for me to make it a single family home than to subdivide it into multiple units? Why are you punishing who make housing available to others?
I rent out one single family home that I couldn't sell when I moved and a 4 unit building where I currently live in one of the units. I never understand these comments. The 4 unit building could be torn down and made a SFH or I could build 14 units which my city desperately needs. If you keep adding rent control and payment vacations and eviction moratoriums and taxes it will be a SFH.
I think your dream is every property is tenancy in commons, but that is legal now and not popular. The reason is zoning. Rich people can compete with two families easily and by limiting the number of units that is all they need to compete with. Much more difficult to compete with 10 families if the lot is zoned for 10.
Anyway, these policy suggestions are maniacal. Go buy and build housing and you'll see how much work it is. Make a startup that makes TiC and construction easier. Go change zoning laws.
Making construction easier just makes those guys lives easier, I doubt it'll result in more housing. Look at the red states with no regulations like Louisiana. They're terrible places to live. Nothing gets fixed with no/low regulation.
I do think his idea about high taxes on a 2nd+ home makes sense. The only problem with it is that it doesn't apply globally, only nationally. You'll have rich people have a palace in the US, Spain, and Australia instead of 3 in the US.
For my own life and approach to this, I moved around a lot and lived in austerity saving up money for a home. I don't want zoning laws to change at all because there's already too many multi-tenant buildings. Pull up the sex and gun offender maps, it's disproportionately those people. And I'm currently a tenant myself (while obeying the laws and having a clean record).
I'd rather see taxes on 2nd+ homes than zoning change. We already built 'out' with suburbs and have plenty of land available for developers to build on and make money. With the internet we no longer have to all live in a city either. It seems to me like his idea, minus the global snag, is generally on the right track.
But I am not a fan of multi-tenant housing near whatever home I purchase, just because of the sort of short-sighted people that often make up renters. They should be in homes anyway, not renting, in an ideal scenario.
It's worth considering that some of us want to rent. I've moved for work a few times, so I rented because it wasn't worth the hassle of buying a house, living in it for 2 years, then selling it to move. Some people move to a big city to start a career, with the intentions of moving back towards home when they've cut their teeth.
Having the option to rent is a good thing, being forced to rent when you don't want to is a bad thing. Hopefully we can accommodate both.
It depends on what facilities the country would provide. Assuming it's USA it's homelessness. If it was another country, it might be provided social housing.
Unaffordable is relative. $150k for a 1500 sq ft house is pretty common there...Detroit needs better incomes, not more housing. On the other hand, SF needs more housing, not more income
People also need to stop flocking to the Oligarchy of cities. New and upcoming cities need to become the norm because those are the ones with a maxima of opportunity plus lower costs.
As in all industries, so long as we refuse to consider alternatives, they'll hold all the power to raise the price. It happens with brands like Apple, it happens/happened to big brand name cities like Miami, Austin, San Francisco ...
