Do you think we will ever have affordable housing again in our lifetime?
Considering how crazy expensive accommodations have become the last couple of years, concentrated in the hands of greedy corporations, landlords and how little politicians seem to care about this problem, do you think we will ever experience a real estate market crash that would bring those exorbitant prices back to Earth?
No, unless we separate housing from investment, it will never be affordable. I don't foresee the political will to make it happen.
This is the biggest issue right here. Houses weren't always investments and making them investments was a terrible idea that's now difficult to fix.
Real estate has become a huge part of stock market and GDP figures. People's retirement funds have become other people's mortgage and rent payments. Affordable houses for some would mean economic decline for others, and no political party wants to create economic decline.
Maybe, but really the issue is construction of new houses. Cities are much cleaner now so people want to live in them. They used to be filled with factory smoke and animal feces.
Yes, more than now. No I don't care that you saw some poop yesterday. The streets were literally caked with horse poop. You wouldn't even notice dog poop.
And most jobs used to be physical, so the average person would have some experience in carpentry. If houses were too expensive, you would find a friend or relative with some expertise and build something yourself. So houses outside the city were cheap because you could build new ones, and houses inside the city sucked (and were cheap).
Part of high housing cost is due to the investment mindset and housing speculation. However, another part of high housing cost is that other people did put in the work to raise its value. Want to live in a clean, convenient neighborhood? Someone kept the place clean. Many businesses set up shop in the area to make it convenient to buy things and get things done. Certain passionate chef set up a wonderful restaurant so that you can just come by and enjoy good food. Some group of people, leader, or politician put in the political maneuverings that got certain ordinances passed or raised the bonds or taxes to build the public transportation. So over time as people continue to invest time, effort, labor to improve an area, it should be expected that the area becomes more expensive (and desirable).
"no political party wants to create economic decline."
I'm afraid I have to disagree.
Yeah economic decline is actually being sold as the solution to global warming. It’s called “cutting back” but really it means making everyone poorer.
Ah yes, because building renewable energy generation, electric vehicles, fortifying the electric grid, repurposing and developing land formerly used for mining and fracking... All things that happen for free.
The solution for global warming has never been "use less than you need" it's always been "use what you have better".
How about using what we want? Is that part of the plan? Or is it only what we need?
You're out of your mind. You're saying no profit of any kind is possible unless we exploit people forced to rent?
I know that's not 100% what you're saying, but that's how it comes across...
Still trying to understand how everything has to be crushed under capitalism. Food. Health care. Housing. Travel. It all there to spin up cash.
Can’t wait till they figure out how to monetize air 🫠
Saw this at a Walgreens last week.
These are really popular with people traveling to Colorado ski resorts and getting altitude sickness. They’re useful to grab to avoid getting sick and combating the symptoms if you do.
I remembered those existed and grabbed one when the gf was having a tough time fighting covid
It’s honestly fantastic that you can buy oxygen in stores. Imagine if you needed oxygen fast and had to wait for a doctor’s appointment.
There are actually medical edgecases for stuff like this where they can be quite useful. That being said, a lot of people definitely also seem to view it as merely monetary, as there are literal oxygen bars in Vegas.
My first thought was "I wonder how sturdy these cans are, and what provisions they have against puncture". Normally oxygen bottles are strong, and the oxygen is dissolved in a foam or something so it doesn't leak out as fast from a puncture.
In the healthcare space they already have. If the wild fires keep up, it won't be long before we have a Spaceballs or Lorax mogul in our midst.
Certain states such as Oregon (where I live) have acts in place regarding forests in general such as the FPA that should prevent the worst, or at least the destruction of forests whether imperatively or by wildfire, from happening.
However, when it comes to other places, I wouldn't even be surprised unfortunately. On the California state border on Highway 199 crossing from Oregon where it's mostly green, you see nothing but Redwoods burned and left in shambles for a few miles, it's gives off goosebumps seeing a natural sight in this awful condition, let alone a supposedly protected state park.
I'm gonna go out on a limb here and say that it isn't capitalisim that is doing this. Blaming capitalism for fucking the 99% is like blaming science for inventing nuclear weapons. Capitalism is just the process. The focus is determined by key players. Frankly, I'd blame the availability of just about every industry in the stock market for what we are seeing. Companies used to be run by industry experts, who had a vested interest in their business being a sustainable long term asset that would provide wealth to their family for generations. Now, companies are run by "Line Go Up" CEOs appointed by a board of stock holders (mostly financial bros) who just want the stock to look real good before they sell it. There is no concern for the customer, workers, or the general populace beyond government mandated standards. All that matters is making money for people who couldn't care less or know less about the industry.
Capitalism didn't ruin food or housing. Capitalists did.
Where hexbear when you need them?
Actually the stuff with the freeest (is that a word? How is that spelled??) markets tends to be the easiest to get and cheapest.
Medicine has uncontrolled price explosion because it’s an incredibly tightly constrained market. Food tends to be plentiful and cheap because it’s not very tightly constrained.
Yes, food did jump in price in the past couple of years … because of massive market interference when the governments dumped huge amounts of currency into the world, with only the upper classes having access to that new cash (it was given to corporations and to stockholders, leaving the lower class to watch their money devalue with no offset).
Housing is another tightly constrained market. You practically need positive permission from government in order to build anything, and there are tons of local constraints on what can be built.
I’m thinking of Boulder as an example where housing prices are skyrocketing, and construction is limited to a certain number of floors.
Capitalism is based on free markets. Where free markets exist goods become cheap and plentiful. But we have a lot of markets that aren’t free, for various reasons.
Investment is exactly what we need. We need more people to see building housing as a good investment, in order to get more housing.
The only other option is forcing people at gunpoint to build housing, and that only works for a couple of months then backfires.
But keeping supply low is more profitable. There isnt going to be an expansion of housing without a change in the rules of the game.
Not without some real force or change, middle class has invested to much of their retirement into the housing market to allow the prices to tank. Those who have are not going to risk it for the have nots.
Imagine storing all of your nation's wealth in real estate that is actively decaying by the minute instead of into companies that make products and provide jobs. What a stupid fucking idea.
Doesn’t matter. Houses are sold for prices as if they’re still mostly new. If you are good you can beat down the price by a cost of a new roof or a new heating system. Never both. No seller will ever acknowledge that renovation doesn’t make sense and the house should be teared down, actively lowering the land value. And they don’t have to. Someone else is around the corner to buy at any price, turning it into an overpriced rental unit.
That’s because in most cases, you’re paying for the cost of the land, not the house itself. Just look at how much unimproved land costs. The house itself is a depreciating asset, the land appreciates so much that it overwhelms the cost of the house. Even condos are subject to this, simply because they take up space (which is worth money) and their price is tied to traditional houses because they are (imperfect) substitutes.
No. Appraisals and tax assessments have a land value and a “structural improvement” values. Both of these are added together for the purchase price.
If there’s a building on the land that’s not derelict and has utilities- it’s almost always going to be worth more than the land value by itself.
There are def certain zip codes and/or a very large plot of land with a single house on it where the inverse is the case (land being worth more than improvement) but that is not the norm.
My entire city burned down a year and a half ago. The burned lots were selling for over half the price as surviving houses, right after the fire. Like they were only 20-30% off. Most of the value is in the land.
No. As the effects of climate change become worse, people will migrate to cooler places, which will only push up prices in those places. Poor people will be left to live in uninhabitable and uninsurable areas, while the rich will get to live in comfort.
Climate change is essentially a class struggle, like everything else in life. As long as the 1% don’t have to suffer, nothing will be done. To get the rich to do something about climate change, it will have to affect them directly.
I also think in addition to what you mentioned people don’t want to address that the population is a problem as well. The earth more than doubled the people living on it in 70 years from all of human history, that’s not just sustainable. You can hypothetically fit 20 people in a one bedroom but just because you can doesn’t mean you should.
I'm in a hot climate and it's far more expensive here than it is in cooler parts of the country, and it continues to be that way. Your hypothesis would be for the distant future, but that's not what's driving costs right now and in the immediate future.
Sure, but the premise of the question is if "we will ever have affordable housing again in our lifetime?" There is no reason to believe there will be affordable housing right now or in the immediate future, and this comment hypothesises why climate change will cause affordable housing to continue to be problematic in the distant future as well.
Exactly this. Elysium comes to mind, altough it won't be a space station in orbit but probably a densely populated blue zone in Western Antarctica defended by turret boats or some shit.
No. Expensive housing is a genie in a bottle.
Once sufficient people have purchased a house at the high price, it would be in their interest for prices to remain high. Corporate entities that buy up houses will actively lobby to make sure housing prices stay high, and the average Joe who paid that much for a house will be happy it stays that way.
I'm not so sure. Large lobbies have greater economic power than us average people, but they aren't strong enough to defy macroeconomic trends. There are many factors that could turn and cause prices to collapse, we just don't know when or if they will occur.
The only factors that can cause the collapse of a captured market are regulation, total market collapse, or revolution.
Total market collapse is very broad.
Fair enough.
"Second Great Depression, because we didn't learn shit from the first one."
I think were closer to seeing people be forced to rent every comoddity they need to live than we are to seeing full home ownership.
The solution is simple, but will never happen. Make it illegal to own a home you don't live in.
Or at the very least make taxes paid proportionally more for each home you own past 1
What about apartments? Dorms? Would that make being homeless illegal?
Canada banned foreign ownership, and a bunch of local shell companies popped up. So it is not as simple as it sounds.
Canada didn't ban shit. The Prohibition on the Purchase of Residential Property by Non-Canadians Act is just a token gesture so that politicians can say they did something.
Since permanent residents and private corporations can still buy real-estate property, in practical terms literally nothing has changed.
If there is political will, there is a way. The problem is often political will.
If you don't live in the building and it's for permanent accomodation, you don't own any part of it. Very simple. Feel free to rent out part of the building though if you do.
Whatever mental gymnastics you did to get from there to homelessness being illegal don't apply.
|Make it illegal to own a home you don’t live in -> Feel free to rent out part of the building though if you do.
Wouldn't renting out a building you don't live in be illegal? Or is AirBnB a loophole?
Yes. That's the point. You can own it if it's your residence even if someone else lives there too.
Also you don't seem to comprehend the concept of bed and breakfast
So the only apartments in this brave new world would have the landlords literally living in them with you. That doesn't sound like an upgrade to me.
Your grasp of the distinction between apartment and building is as abysmal as every other concept you mention.
Also you seem to be equally ignorant of the idea of owning an apartment and of social housing.
Ah, you are just a common troll. Got it. I was a bit tired, so I fed you after midnight. Won't make that mistake again. Good night.
You're the one performatively misunderstanding simple concepts.
It's very clear. They didn't mean home as to mean any residence ever. They meant single family dwellings. I'm very confused as to how you didn't understand this.
This is so stupid. The fact that people upvote this makes me want to go back to reddit
I think the people here are young and well meaning but don't have much real world experience yet.
People here are extreme i went to reddit but quality of conversation is shit. I enjoy tildes a lot i have invite if you want quality of conversation there is amazing.
That's not extreme. The extreme answer involves more guillotines.
I bought an apartment about 15 years ago. I finally finished paying it about 3 years ago, and recently got an offer to move to Ontario. With the current house prices and what I was offered there (about 80k), I could barely make rent for my family. I really wanted to move but had to say no because of stupid absurd rent prices. What’s weird is that if I wanted to rent the place I bought I would not be able to afford it either. This is bullshit.
There are 2 big obstacles we need to overcome. The first is corporate ownership of residential property. This needs to go away.
The second big issue, we need to build higher density housing, and get rid of the enormous parking spaces that take up our downtowns. Not everyone needs a house. And you can absolutely build medium density housing that doesn't feel cramped. Sure, living in an apartment is not perfect, but you are closer to the places you want to go, and public transportation is more feasible. It's a win-win for everyone.
The problem with high density housing is that the quality is shit. The quality is shit with lower density housing too, but things like thin walls in apartments goes a long way to people wanting to join in the sprawl. Developers fight tooth and nail against any regulations that are focused on QOL or environmental improvements (like "passive house" standards) and promise that they will make it cost far more than necessary if they are so burdened.
Sounds like the solution is to nationalize a good chunk of the home construction industry and run it at cost
Ultimately, change will only happen when the institutions start listening to the people. But we know that won't happen as long as corporations can buy out and bribe the institutions meant to regulate them.
This is kind of just something that krept into my mind but I think with a slowing birthrate that we may just end up with too many homes at some point in the next 25 years.
If you’re talking about the US, the slowing birthrate is compensated for by immigration. This is what drives immigration policy and why the US hasn’t fallen into the same demographic slump as Japan has, and China soon will.
Add to this that much of the tight housing market is driven by people around the world investing in US real estate. Some estimates are as high as 30% of homes sitting empty, held by foreign investors, just appreciating.
Between these two things, we are extremely far from being able to visualize too much housing. I hope we get there, though. Because it would fix the high pricing and allow us to demolish some of the oldest, shittiest housing which is only still around because the market is so nuts.
It'll probably even out as we may not have enough people to build them?
Perhaps, but in an energy-scarce world, who would be able to afford living in an old, inefficient house? I obviously hope to be wrong but increasing material price and labour might alone offset whatever price decrease the extra inventory of a decreasing population might bring. I hope to be wrong, ofc.
My old place was a cold, stone cottage and was a nightmare to keep heated.
The kitchen at one point was measuring 6°C and that was with the heating on in the winter.
We got out of there in December 2019 and I'm so glad we did, because with COVID, Brexit and the war, house prices went bananas, energy bills went through the roof and interest rates have increased massively.
We could never have afforded this place today. I really feel for young folks today, we bought our first home at 33 years old after years of saving and that was in the time of almost no interest - it would be impossible now.
Yeah but the market is going to have to absolutely tank first. There's a lot of money in that bubble, and it's going to be fucking painful when it does. But it'll get there.
When it tanks people would be laid off and have no money for houses. Basically 2007 all over again. The rich would swoop up all the cheap real estate.
And the cycle would repeat a-fucking-gain, with the poor wanting silly things like owning their own land or homes and decent living wages being blamed for the next burst bubble
After the climate mass deaths, migrations and/or wars, there should be plenty of land.
Although it might not be habitable.
Plenty of unoccupied land, but not unowned.
Perhaps, but what is ownership without a state to enforce it? Companies/landlords would need to occupy and defend it themselves.
The problem is not affordable housing, there's plenty of that in the US, the problem is getting people to states where housing is affordable without significant drops in quality of life due to lack of access to services and such.
Like, you could buy land in Detroit for the price of a decent car, put a trailer on it and you're already on the property ladder, but you're in Detroit.
This sounds great, but when people start moving, pricing goes up. There's too much investing and too little self-ownership of housing.
The rise would be slow if it's spread out. In my country it's one of the better ways to build equity. Buy where it's cheaper and wait for prices to go up.
Then sell it in 10 years and buy where you want to live, you'll have atleast half the money and definitely more than what you paid for it
Not until people get off their asses and show the 1% they have no real power. In order to make an omelet, you need to break some eggs. It is long past time to crack some shells.
The only way that the 1% lose their power is if the rest of us unanimously decide they no longer have power. Which is why there is so much effort put into preventing any kind of agreement.
It's obvious that rich billionaires sometimes make poor decisions. There has to be a way to exploit that.
There is, but you practically have to be in their inner circle to do that.
I'm sure there's a way to get into that.
Problem is, the 1% have so much wealth that they do indeed have the power.
— Joseph Stalin
Wuahaha. They’ll crush that tiny rebellion of yours with hired forces aka police, who’s prime purpose is to protect property, not people.
I suspect that a strong push for fully remote work would help the US with housing costs due to a chunk of the workforce moving out of the cities and into the boonies.
That already fucked long island. "Everyone" moved out of NYC and bought all the housing on l.i when COVID hit and WFH started, now it's completely unaffordable for anyone under the age of 40 and/or unmarried.
The listings have just become a joke. 300k+ for a twice burned down shed posing as a house in a flood zone and in the worst towns. It's absolutely asinine...
No. With climate change more land will be unlivable, there will be more conflicts and more immigration (legal and illegal). Housing will increase because demand is high and supply will shrink further b
No. Not because of overpopulation or such, but because the powers that be have simply discovered how lucrative it is to use housing as a business investment, and the fact that everyone NEEDS housing, no exceptions.
This is essentially a supply problem, so the "supply side" of this equation is the side with all the power. The end.
No. Not because of overpopulation, but because the central bank is devaluing the currency. That transfers wealth from all of us and gives it to TPTB.
Costs of housing have grown significantly faster than most other costs, it's not just regular inflation
And some things have experienced price deflation. It's all still related. Point still stands - central banking is the primary issue.
Only if capitalism falls. Otherwise zero chance. Sry.
Well, birth rate is steadily dropping. As people die the housing market could change. There are free houses in rural Japan because their population has been declining and young folks all moved to the cities. In 30-50 years we could see something similar.
That's a good point. Well now I'm much happier to not have kids.
you're not factoring in catastrophic climate change into your equation. in 30 to 50 years much of the equatorial regions will ne unlivable. massive levels of climate refuges will be shifting. we're seeing unlivable wet bulb temps TODAY. so this isn't catastrophising. it's an almost certainty at this juncture.
I dunno, I try not to worry about these things to much. I'm not having kids I do what I can to live a low carbon footprint life. Not really anything I can do about it. Thinking about moving somewhere cooler with more solid natural water access incase of societal collapse... I like to garden and preserve shit anyway.
That's honestly the best you can do at this point. individual change is really limited when industry is like 85% of the issue. I try and do the same. grow my own food, drive an ev powered by solar panels, don't eat meat etc. but it really feels futile when it's a drop in the ocean as far as impact goes.
Just keep building, and change zoning laws to make that easier.
Yesterday I caught this little tidbit from the Denver news as I walked through my company’s break room:
As someone who grew up before macroeconomics was declared evil and apparently purged out of higher education, it’s no mystery to me that a market with inadequate supply will have high prices.
I’m not necessarily familiar with the exact definition of “macroeconomics” in this context, and I’m far too young to understand the cultural nuances you describe.
But I’m pretty sure it doesn’t take more that two brain cells to understand that the latter point is almost always the direct cause of the former.
It’s been 20 years since I took the class, but I think basically microeconomics is individual decision-making, and macroeconomics is market-level trends.
So an average market price over time is a macroeconomic model and a household’s maximum budget for groceries is a microeconomic model.
Supply and demand curves exist in macro.
What’s the deal with it being declared evil then? It makes a lot of sense.
oh Denver. It's been that way in Portland for several years now.
No, at least not in countries (e.g., the USA) that rely on the state to micromanage every aspect of zoning, and which therefore allow NIMBYs to derail progress at every possible step.
In a better world we would draft new laws to throw out our entire zoning system, and start over with something much more flexible at the state or national level- ideally based on the approach Japan uses, which defaults to mixed-use for every building and makes NIMBYism structurally impossible.
I think zoning is a related and secondary issue, but so long as the housing market is a market, and a few people have almost all the money, all zoning changes can do for housing prices is temporarily alleviate the problem. People with money are always looking for places to park their capital and collect rent. There's no better vessel for that than real estate.
Obviously, we need to gut literally every aspect of American urban planning for a million other reasons too, but on this specific issue, I think it's second order.
Absolutely the case. A lot of your single digit millionaires became such because they're home owners and landlords.
I mean I do kind of expect the world to completely collapse within 20 years, so kinda?
A cave or a half-destroyed building in an overgrown city are free right? Doesn’t get cheaper than that.
No.
I never wanted to be a homeowner personally, but earlier this year I noticed that four AirBNB's had materialized just on my little block in America, so I bought a condo. I paid $40,000 more than it cost ten years ago, but it's beautiful, I like it, and it gives me the ability to stay where I want to long-term, so here we are.
The Federal Government is not going to act on the forced scarcity of housing, so expect the issue to be handled similar to the way states handled COVID. Some states had good policies. Most had shitty policies, but overall, the outcomes were negative to some degree, and that's almost certainly what will occur with housing over time.
Sadly, the only way to essentially secure/stabilize your housing costs (with the exception of taxes) is by buying your home. Then with equity, assuming relatively similar markets, it allows you to move from one place to another regardless of land price increases.
Renting doesn't really make financial sense because you'll just get squeezed harder and harder by owners forever.
It used to make sense depending on your area and intended time you were going to rent for. This assumed that rent was significantly less than a mortgage and you were able to save or invest at least some of the difference. That gap has long since evaporated in desirable areas. In many cases, rent is as much as a mortgage. The problem here is that it prevents people from saving for a down payment (which alone could buy a home twenty years ago), and even if they could, homes are being snapped up with all cash offers from investors or corporations... So they can be rented at a profit. It's insane.
Financially it may not, but done people like their lives to be uncomplicated, and renting lends itself to that kind of person.
Is it less complicated? With renting you still have leases, weird rules, lack of control, rent/fee increases, creepy landlords, and the futility of trying to get security deposits back. Less paperwork, maybe. And it is kind of expensive to buy/sell if you plan on moving often.
Renting made sense for me basically when I either didn't expect to stay long, or before I could afford to own.
I think it's way less complicated.
I paid my rent and in return I got peace. I didn't have to worry a sudden plumbing or heating bill. I didn't have to furnish a house-sized space. It was just an easy life, but the only way I could guarantee that I'll be able to stay where I want to be was buy purchasing, so here we are.
To be honest, I never saw myself buying anything. But when rents were raised a whipping $500-600 in a single year in my area, I got concerned for the future. I bought a small condo that I could afford (still at a cost far above what it was worth pre-2020...around $40k like yours) because I was terrified at what would happen if rents continued to skyrocket at suck a rapid trend. Never in my life have I seen that happen before.
Idk if I made a good financial decision or not, but it seems both of us took a similar path). We'll see what the future holds.
We're starting to see prices decrease right now, since high interest rates are holding. The big analytics firms think we will see a return to affordable housing in 2024 as long as the fed continues to raise interest rates. The reality for larger cities is that prices will most likely stabilize and possibly decrease slightly, but never return to reasonable. Lots of people are in 2% mortgages right now on homes with inflated values. Those people are never moving unless life forces them to. So while rising interest should decrease housing affordability and force prices back down, inventory will remain low, keeping prices pretty stable. Areas with abundant inventory should see a return to normalcy, but for big popular cities, this is probably the new normal. Unfortunately nobody has a crystal ball, and we can't be sure of anything. But this is what the experts think.
The point is that those price declines would benefit only the wealthy who had the money in cash, but regular people are not having so much savings and for them even those "lower" prices are actually higher when considering the interest they will pay to the banks.
If you can eat the higher mortgage payment until the interest comes back down, and then you refinance, you'll actually come out ahead of people who bought at high prices when interest was low. You can always refinance. You can't re-negotiate what you paid for your house.
I have heard people say this, but why are we assuming the interest rates will come back down?
Because of their historical averages. They could stay high forever, but they probably won't.
Historical average home prices were lower too though. Why is this different?
That isn't really holding up this year. Interest rates are correlated with price increases. Prices corrected after the initial increase but have since continued to increase. While the cost to borrow has gone up, the reason for increased interest rates will always drive up prices. The federal reserve will raise interest rates if inflation is high (driving up nominal prices) or if employment is too high (increasing demand). Home prices will decrease if there is a recession but then the fed will lower rates to fight unemployment (assuming inflation isn't an issue).
In the US home prices are only down 0.5% year over year. In my high cost of living area (SF Bay area), prices are down 10% but climbing every month. At the current rate of home price growth, the Bay area will be back at all time highs this winter/spring.
https://ycharts.com/indicators/case_shiller_home_price_index_national#:~:text=Case%2DShiller%20Home%20Price%20Index%3A%20National%20is%20at%20a%20current,0.50%25%20from%20one%20year%20ago.
I'm just hoping I can find a decent job before I die. I'm on a string of progressively worse and worse jobs that are driving me to the brink.
Same. I had a decent job in my late teens early twenties, decent as in it paid really well and I liked the hours even though they were weird and long. I left because it wasn't the type of job that got me "adult points" and I was sick of being looked down on for what I did (it wasn't anything NSFW or anything, just more of a teen job type that I excelled at and got myself promoted up the ladder). I told one of my co-workers "I like this place, and it's paying me good money, but I don't want to be 30 and still working here."
Well fuck me, because it turns out that I'm in my 30s now and that's still the most money I've ever fucking made. My boss from that job actually just texted me the other day and offered me my job back even though it's been over 8 years and if I hadn't moved 1,000 miles away I might have considered it because he would have almost doubled what he had been paying me before.
I'm back doing the college thing trying to better myself and get into the tech sector, and fuck I hope it works out because if not I might just decide to finally opt out of this world. I've fucking had enough of trying and trying and busting my ass just to keep having the rules change and the goal posts move.
I've been at the same "stable" job for 8 years and am practically suicidal over how much I hate it.
I still hate homelessness and starvation more, so...
All of my friends joke about going in together on buying some property and starting a commune. It’s a passing joke but in the back of our minds I think we’re all seriously considering it. Logistics is the only reason it hasn’t already happened
Look into housing co-ops! They're basically this and there are already (kind of) a ton of them around!
I've been in one for a couple years now and it's going pretty well.
Fate will decide whether we see this in out lifetime, and it will depend a lot on where you live. Several factors affect these prices, and I probably don't have an exhaustive list but here are some.
There is the boomer bubble. Boomers possess most of the houses. When they die, a lot of house will enter the market. Fortunately for us, heat waves and pandemics should accelerate this process.
There is the financial bubble. Housing earns money, and all actors ensure it stays this way. To solve that, you need to kill housing as a finance product. The most effective solution (and I think the only effective solution) would be ceiling to location prices. And with that, forbid, through taxes or rule, empty houses. Let the landlords deal with market shit. This would instantly crash the market, which is an excellent thing for everyone but people who rent houses or plan to sell their house.
There is the actual market: we usually need more houses, but building too fast would crash the market. So if you let building to the market, it will never build enough for prices to go down. You need a government that will force construction. You also need laws or taxes against empty houses.
A note on empty houses: it is a very important factor because it allows landlords to control the market by removing or releasing houses on the market. The only empty houses that should be allowed should be for repair or hostel.
There is the globalisation, especially planes. Planes make connected cities kind of neighbours, which means their house prices will become similar over time. This means that changes in plane traffic, laws or airports can affect local housing market. It's not such a big deal though.
There is probably more to say about finance. Loans are probably a factor too, but I don't know enough of it, and what I say in the finance part will affect it too, an probably in greater proportion.
Tl;Dr is simple : you need a brave government to apply simple and known solutions to the problem. Landlords will be ruined and that shouldn't be a concern but that will probably be the reason why nothing will be done.
Oh I need to add a note about boomers because it's interesting now that I think about it.
The thing is that post ww2 capitalism had it that the dream for workers would be to get a work that allow them to buy a house, maybe a second one, and live a good life for that. It worked well, but like all capitalist dreams it was pyramid scheme that ends with us.
That's why most politicians won't do shit about it: it's the core of the American/capitalist dream. It is also why most boomers will never believe or accept any solution to the problem: their whole life was built on this, and now rely on this.
A lot of boomers are also occupying homes much larger than necessary. I live in an older suburb of 1950s houses so its a mix of older people and younger families. Of my immediate neighbors at least 12 of 30 homes are single old people or couples living in 3 or 4 bedroom homes with yards. These are good neighbors because they are quiet and rarely seen but completely wasting space that families could be living in.
I'm trying to get a mortgage atm. Long term disabled / self-employed with low income, got dad as a guarantor, I feel amazed we managed to get a single lender, we now have a mortgage in principle.
I'm also horribly unlucky so I can predict with near-certainty that yes house prices will crash immediately after I'm on the hook at 7.5%, at which point interest rates will also plummet.
Can't put a price on having my own space and not being evicted on the whim of a greedy landlord though (my current situation, 13 years, £70k in rent, not so much as a thank you or goodbye, just off you fuck so I can get someone in paying more).
You can always refinance if rates plummet. But rates and prices have an inverse relationship. Prices fall when rates increase and prices rise when rates fall. So your ideal scenario is to get in with high rates and low prices, then refinance later for a lower rate. Although right now we have the worst of both worlds, high rates and high prices. Prices are starting to stagnate due to rising rates, and may eventually start trickling back down as high rates hold.
Thanks, that's really helpful info. One of my friends told me I was insane for buying a house right now, but my response was that there's never really a 'good time' to buy a house... the best time was always 10 years ago! Trying to time the market whether with houses, stocks, crypto, whatever is rarely a good idea.
Not until people quit buying them. And it's not sarcasm or trolling or whatever. There are tons of cheap housing, but it's in places people don't WANT to live. Until people start wanting cheap housing more than a certain location/ job, prices won't come down.
It's not even the "location," it's the people that come with the location. If I could live in a rural area ANYWHERE in the US without having to look at Confederate flags or deal with out and proud bigots, it would be amazing. But that's not the country we've let happen.
In 2007, I might have said "no."
It's just gonna get worse until everything crashes completely in a way that nobody will own anything they can't carry on their back.
I think it is achievable. But someone has to start doing the economic planning to make it happen in each local area.
One approach is to take political control of each city and resolve the problem by applying sufficient government. Either you make enough housing for the people who are there, or you seize enough stuff for the project that people start leaving. But that can be hard to muster the political will to do.
Alternatively, "housing" per se is not unaffordable: at whatever reasonable fraction of a normal wage, there is somewhere on Earth that you could pay to live. Plenty of empty space in small towns scattered across the US, for example. The problem is that you can't actually live there, because you also need to have a job to pay for the housing, which isn't where the housing/empty land is. Also many of these places are so under-served by municipal services as to be practically uninhabitable: you can afford an RV and you can afford an acre of desert with no electric, water, or sewer service, but you cannot combine the two to create acceptable housing.
If the people who control the cities where the work and services are are unwilling to accommodate residents, then work and services need to be organized in places not under the control of these malicious actors. Ideally with new mechanisms in place to prevent the same failure modes from reoccurring.
With more of a push for WFH (which could be legally required as an option in some cases) and ensuring smaller towns have good internet access, smaller towns could be a lot more viable. They aren't to everyone's taste, but there's plenty of people who would love to live in a small town if not for the hellish commuting they'd have to do and the shoddy internet access.
Having decent transit options to the nearest big city would also help. Small towns often struggle with cars being a necessity because you'd have to go into the big city for many things.
In the early days of the pandemic I was thinking the shift to working from home would cause people to flee cities and move to smaller towns, causing major demographic and social changes.
I was half right. People did move to smaller towns, myself included. But then we saw firsthand how awful they are and moved back to big cities because it's worth it. I could go the rest of my life not living next to mouth breathing MAGAs.
Not sure if we can rely on smaller towns to moderate our prices..
If we have affordable housing, that would lower the prices for landlords, and we can't have the leeches hurt
In Australia, they are bringing in a shared equity program that has given me hope. Roll on 2024...
Straight up house prices? Yes.
As soon as people start thinking prices can only go up, housing has dropped. Over and over.
Affordable overall, including insurance and maintenance? No, we have never had that, and probably never will.
People talking about societal collapse here, look at the past. It was worse. We have come forward not backwards, overall. Sure it looks dire, but really, would you rather live in the past? Like maybe, if you are a rich white guy, but if so you are probably doing ok now too.
I've got my ears tuned listening for a shoe shine boy telling people to go buy rental properties, markets to plummet immediately after.
Remember that great scene in The Big Short talking to the stripper in Florida who owned four condos two houses and a boat, something like that.
The cost of borrowing is far higher than it was before the 2008 crash, and subprime adjustable rate mortgages have largely been regulated out of existence since then. So while there will be some kind of crisis, it will look different than 2008.
If curious if "affordable housing" has an actual definition? Like is there some formula that we could use?
Housing should be a right tbh
How would that work, do you think? I agree with your premise, so you don't need to worry about that part.
I’m what they call an “idea man”, meaning I don’t know anything lol but I dream big
Housing and affordable housing should totally be a human right. Look at all the global inequality and how it keeps on growing, the Rich 🤑 / wealthy are accumulating and consolidating wealth 🤑 ... Locking people out of opportunities 😕😔😔😐 n the governments do nothing to protect their citizens from the legal corruption... In fact they help the corporations out.
If people who built nations and kept them running ( the workers / ETC) were compensated properly we'd all have housing, food, clean water ETC. It's called sharing the profits / wealth. But that's not what monopolies and people at the top 🎩 🔝 of industries do.
I mean US still got child labor 😭 till this day.
People that keep the countries running need to go on a strike / protest all at once for a week or two and demand some kind of equality from their government or otherwise no work no running economy!!
It's been done before and it can happen again if we can brave sharing food and water with each other for a week or more.
Tie minimum wage (aka liveable wage) to median rental prices of the area.
If the average habitant in a country can buy a house and pay the whole credit in his lifetime, I consider this as affordable housing
Depends, do you want that person to be able to have a partner, kids and something to eat? If no then yeah, probably.
At this moment in The Netherlands:
Oh, and there is a huge shortage and building has dropped to less then 10% of what is needed, due to inflation. The only way hiusing is affordable is when you already live in a bought house and have been living there for about 15+ year. (Bought mine in 2000, before the prizes exploded and after that the mortage rates exploded)
Either the income needs to improve a lot (with constant prizes and rates), or the prizes need to collaps (when that happens nobody will move, to expensive)
You probably mean median, right?
But I meant an official one.
Ideally lower than median: closer to Q1. Still, you have to start somewhere.
Yes. Housing prices have always crashed about once a decade, ore or less. Also prices tend to plateau for 10-15 years until Incomes catch up. I don’t see why this won’t continue to happen
The only difference is this time we have clear lack of supply, along with impediments to building more housing in places people want to live. There’s a profit incentive to building more and I wouldn’t bet against overcoming those obstacles. Money always wins
There are 17 million vacant houses in the US. Also 60k homeless people. There is plenty of housing if we crunch down on inequality.
The question is where are those houses? Are they in towns and cities people actually want to live in, or are they in bad locations and that's why they are vacant?
Oh. Oh, this is stupid. That's why there's so many considered vacant.
https://www.nytimes.com/2022/03/10/realestate/vacancy-rate-by-state.html
Those numbers really aren’t comparable and the relevant data is not sufficiently detailed to make a valid comparison.
https://www.reddit.com/r/badeconomics/comments/musne8/disproving_the_vacant_homes_myth/
https://thefrisc.com/its-high-time-to-slay-the-myth-of-all-those-vacant-san-francisco-homes-2efd50728d8
What's a vacant house? Is it unowned? Or is it a second house?
Affordable housing where?
grimly points in the direction of Ohio
As an Ohioan, it's really not a bad place to live. I'm not sure why Ohio became the butt of so many jokes.
If some more blue voters would move here (or come back) it could really be a great place to live.
... and yes compared to the situation in a lot of other states and metro areas, Ohio is very affordable.
Ohio Gozaimasu!
I'd rather be homeless ty
I believe there are, and will be. Over 20 years ago, I moved to Dallas, TX area for the same reasons - to get away from unaffordable housing in the west and east coast. At the time, I found Dallas to have a good housing price to income ratio.
But in doing so (moving to Dallas), I may have also potentially taken a big (lifetime) pay cut. I graduated from a top ComSci school, but in moving to Dallas, I put myself outside of the market of the emerging FAANG companies in the west coast.
I think now there are still medium size cities where you may find a good balance of cost to value and quality of life. It really depends on your career goals and life goals. There's always a trade off. I believe right now, the midwest is a good value, if you can stand the winters there :)
No. We won't be able to solve the problem because we refuse to believe that viable solutions are any more complicated than "put person in house".
Not without changes in zoning codes, so no.
No.
Unless there's a massive crash or a bubble pops, leading to a significant recession (unlike what we're currently in... Far more severe, and probably more severe than ever before).... No.
It may come down, and kind of ebb and flow a bit, but "affordable" isn't going to be a word used to describe where prices go from here.
Also, we definitely are in a time of great inflation, which is causing recession-like things to happen. If there's a recession at all right now, it's being manufactured by artificially inflated prices by greedy companies, more than anything else. This would be a good thing if "trickle down" economics existed (it doesn't).... So instead, everyone at the bottom is slowly dying while billionaire bank accounts gain a few more percentage points. When the system snaps from the massive disparagy between the ultra rich and the poor, if the system doesn't entirely collapse at that point, then we'll be in yet another unprecedented, once-in-a lifetime event, like we've never seen before. All of the millennial generation will groan and roll their eyes about it happening yet again.
Millennials, and by proxy gen z, have been so completely fucked by all the ultra rare events that have happened over the past two decades... A housing crash, a pandemic, a recession or two, now out of control inflation and insane race wars heating up. I feel like the entire generation is so burned out from it all that if aliens showed up tomorrow, it would barely be a footnote in most people's daily lives. Honestly, anything an alien race did, like taking over the world, would probably be an improvement. Even death at this point, seems more appealing than a lifetime of indentured servitude in an unfair system designed from the ground up to force the "poor" into positions they don't want, doing things they don't enjoy, just to make enough to live. That's not enough to make most of the generation suicidal, but I don't think many people would give a shit either way at this point. Moreso if you don't have dependents.
I know parking lot minimums make it hell for new stores to be built, but does it also affect mid- and high-rises? Because that would fucking suck if that’s another reason it’s hard to make affordable housing.
Yes, it does, and it does.
There is affordable housing now, just not where you are. Lots of places that are high end now were at one time undesirable low rent places. Brooklyn and the West Side of Hollywood are both communities that originally drew people because of low quality, low cost of living accommodations.
Look to the rust belt cities that didn't fully collapse to lead the charge. Detroit is stabilizing while still having low rent areas. Maybe Some places in Ohio and Buffalo NY as well.
You can buy a full on house in Rochester NY for under 40k but you may not want to live there.
Barring a calamity, nice places with high rents sort of stay that way. I can't imagine high cost of loving areas like Boston, Denver , Hawaii or Miami going down for anything other than an asteroid. Prices are high in places that people want to live.
I was going to say something very similar. If I look ahead and think about eventually retiring, there’s no way I could afford to do so in my current high cost of living area. However housing prices in the upstate NY town I grew up in, are next to nothing. I could just quit today and live out my savings, but then I’d have to live there
I'm not sure. I don't really believe things will get better, as they only seem to get worse as time passes. I'm a 3rd worlder...
Not only no, but you better get a burial plot while you can afford it.
Just throw me in the trash!
No I don't think there will be a crash. I think we might see legislation meant to help affordability become a topic in the 2028 presidential race, when Trump and Biden are definitely out of it so there's a cluster of low-education populist voters in swing states who become swing voters, and the replacement options are decades younger and they will want fresh ideas to be at The forefront of their campaigns.
Narp.
As long there is no Mass Genocide and Mass Death of Owner,the only possibility would be a to high Interest Rate that forces home owners to sell.
All the Possibilities
How would a high interest rate help? My mortgage is locked to a fixed rate.
Given that most modern construction has a mortgage with some bank, a "Mass Death of Owners (and their descendants and families)" would just make the homes pass on to be property of the bank.
But the bank will now have a glut of properties to sell or rent out, and far fewer people competing to buy them, so prices would drop.
Sadly, they will just claim bankruptcy and we will bail them out... again. Eat the rich.
Interesting fact, the Black Death in Europe gave an opportunity to peasants to get a better life. The ruling class did what the ruling class always does, and try to prevent the peasants from getting a better life. Thankfully, the peasants realized "Fuck this. We have power and we're going to wield it."
How the Black Death made life better
What can the Black Death tell us about the global economic consequences of a pandemic?
Social and Economic Effects of the Plague
Effects of the Black Death on Europe
Yes and the best thing you can do is get ready for it. Don't give up and wait for something to happen before you start preparing. Save your money now and when prices drop you're ready to strike and get what you want quickly
Yes. And I think soon. Student loan repayments will force people to make tough choices. I think people got into very large mortgages because they could afford it without the student loans, and likely expected rates to drop before the loans restarted.
Those people will probably have to move, possibly short selling the home (where the bank takes your home and sells it for what it can get, clearing your debt in the process even if it's less than your mortgage).
This kind of stuff happened in 2008, and I just saw a graph showing housing slightly less affordable now than then.
Lmao what universe are you living in where people with student loans own homes.
I work at an engineering firm and my coworkers and myself all own homes with student loans. I'm not saying it's a high percentage of people with student loans, but there's definitely a sizable number.
When climate change gets bad enough that the world goes mad max there will be plenty of houses to choose from. That's assuming the SHTF in your lifetime and you survive.
Aside from that, no.
Either the housing market will crash after some new laws are applied that specifically target landlords.
Or the price of buying houses will catch up with the cost of building them.
When either of those will happen, I do not know.
Not in time for people looking to buy soon. I think eventually it may happen but it might take decades.
Eventually we are going to realize that not everyone is going to be able to have a big yard and a big house with 3 cars each. Something has to give and I think it is going to be zoning laws. So while people might be able to afford "housing" again at some point in the next 50 years it is going to be more like a shack than a house.
No in this capitalism situation there is no more chance with the actually prices to own an house.
Not unless we reduce the amount of red tape necessary for new construction. A market with super high housing prices should naturally correct itself as those profit margins attract new investment, but we clamp down really hard on new construction via nimbyism and over precise zoning laws.
In a democracy, it usually requires a majority of people to feel the same. Right now, in almost every Western country, most people live in owner-occupied housing. Most people are perfectly happy for prices to keep going up. So they’re fine with high migration and slow building. Slowly, the number of owner-occupied homes is decreasing, but we are decades away from the flip. When it happens, it’s going to be extremely destructive. Generations have and will have been locked out of home ownership. There will be all kinds of punitive taxes on property.
Check Germany, only 49.5% own their houses and the situation is getting steadily worse.
It is getting ridiculously expensive and the majority of the people cannot afford getting a mortgage. In Munich the average sq.m. is between 8 and 15K while the average salary is 3K and the rent for 70sq.m. flat is 1.500€.
Depends if the next pandemic kills 50% of the world's population.
It's all based on supply and demand. There is not enough housing for everyone to have one at a price they can afford. The price depends entirely on what the wealthiest buyers are prepared to pay, or rather what a bank is prepared to lend them. It is nothing to do with how much the land or bricks and mortar are worth.
The only way you'll get a price drop is if the amount of properties go up or the demand drops.
We've had long periods of <1% interest rates. We've normalised 40 year mortgages. We've invented "shared ownership" schemes and "help for first time buyers". None of this has bought the prices down. It's done the opposite and blown them into the stratosphere.
It's not only supply and demand, on some countries there's more empty houses than homeless people, rich people and banks rather leave the houses empty than lower rent or price, governments should step in and tax empty houses.
Yes, but that will only help the homeless if they spend all that tax money (and more) on mental health care and addiction therapy.
Spoiler: That's not where it will go.
Also a lot of these empty houses are in places where nobody in their right mind would want to live even if it were free. There's a little bit of rich people squatting on "investment" property or holiday homes, but it's not the majority.
Except for the first time housing prices and availability are more to blame for homelessness than mental health.
https://www.cato.org/briefing-paper/housing-markets-first-housing-supply-affordability-are-key-reducing-homelessness#:~:text=In%20a%20recent%20book%2C%20authors,substance%20abuse%2C%20or%20poverty%20measures.
So... you say they're perfect for the mentally ill homeless? 🧐
I’m hopeful
Yes. Once we have coordinating unions and global strikes, we make the rules.
Yes but it depends what country you are in. Many countries are not controlled by greedy landlords.
this is lemmy what do you think they will answer
I mean we are seeing the results right now of decades of exponential growth. Take a house that costs $100,000 and increase prices from 3-10% per year every year for ten twenty forty years whatever and boom, same house now costs a million bucks. It's not surprising to me at all. Idk how to fix it but it's not surprising.
Decades? 2008 was only 15 years ago...
? Housing is an asset class like any other and grows over time. What has 2008 got to do with anything? A quick google search shows historic growth rates around 5% a year.
YoY growth data is updated quarterly, available from Mar 1992 to Dec 2022, with an average growth rate of 5.4%
That's a double time of about 12-13 years so roughly 3 doubling since 1992. That's an 8x multiplier so yeah, that's how a $100k house turns into an $800k house without a housing bubble to inflate prices even more. Just normal market forces.
That what were you saying about 2008 and why did you downvote me for it? Lol
There are still countries with affordable housing like here I bought an apartment for 90 000 euros a few years ago. I was renting it before for 450 euros. It's in the capital next to a park.
As for the places where people can't afford a home: I think climate change will take care of that. Once we get events where death without a home is guaranteed the math will change and people will just break into and squat in the empty homes. Once that becomes popular enough something has to change or a whole lot of people will die when evicted, I don't think any country can handle that PR disaster.
And I bet the same apartment now costs more than 200K Euro. And also the rent went up considerably.
Seems apartments the same size and location are still in the 80 000 - 110 000 euro range. Renting is not very common here so I can't find anything comparable.
Just out of curiosity but are we talking about Talinn? I am coming from east Europe, where accommodation used to be cheap, now it is 2500€ per square meter in the capital. The last 3 years prices spiked quite considerably. I am currently living in Munich where the square meter is 8-12.000€ depending on the energy efficiency, the location and how new the building is.
Yea, Tallinn.
No, unless there is a thanos-snap, then everything like housing, energy, and climate change will resolve automatically. But if humans keep on breeding like bunnies and outsmart things like aids, ebola, and even covid, overpopulation will put a lot more people in misery.
Every problem we solve only gives the opportunity for population growth... until the earth can't sustain us anymore.
It sounds cruel and that is why a lot of people won't admit this.
No. Stop hoping and take the houses instead.
Idk about this fad. I bought a house at 25 without a problem, and haven't heard of my friends having much problems either. Is this a US thing or what?
I am actually based in Europe and here prices really shot up after COVID.
Europe too. For sure cost of living went up but house prices have been quite stagnant for a while
Do you guys not have
phonesparents? You will get a house when they die. If you have siblings, you can always murder them. If your parents dont have a house, then you are fucked.In my case;my parents house needs a new foundation, new wiring, new insulation, half the rooms need to be finished because they keep tearing them apart. Bulldozing it and rebuilding might be cheaper by the time I inherit it ( probably in 20 years)
That would put me at getting my parents house when I'm like 65 because that's how old my Dad is and his Dad only recently passed away (grandma died a couple years ago). Nice plan there.
Want prices to drop?
Stop buying houses.
Eventually the bubble will burst.
The economy will be shit for a few years. And Eventually things will return to normal.
You heard him! Let's all sleep outside in the gutters until the bubble bursts.
If you prefer instead, I can sell you my house at its current inflated value.
Can't sell it cheaper then the jacked up value, because then I can't afford another house.
Gee, I never thought about all these houses that I was buying without a second thought! Damn, no wonder the prices are going up like crazy!
Sarcasm aside, a lot of real estate is being bought by rich assholes and companies that keep rolling debt on top of debt and using their owned property as collateral for getting more loans and keep the ball rolling. This was the case in 80s Japan and is the current case of USA (almost like a repeat of 2008) and China. If the previous bursts are anything to go by, prices won't go down.
Population go up. People live where?
I'd recommend either staying with parents, or finding a roommate right now.
Or, checkout some of the van builds. I'd totally live in one if I didn't have a full family to support.
Anyone who buys property currently is going to lose a LOT of money in the next year or so... so, I'd highly recommend to not buy... unless you don't mind paying 250,000 for something worth 120,000.
Rofl 250k. I wish I could find a home that cheap. Just closed on a $1.16mil home out in butt fuck nowhere. It's nothing special, just a 3 bedroom single with a tiny backyard.
Must be in California or near Houston? Or another large city I assume.
But, yea. Prices are doubled everywhere. Pre covid, I was getting ready to build a brand new 3k Sq ft house for around 200-300k.
Can't even touch the plot of land for that right now. And... the price to build is basically doubled too.
~20 min away from the border of a major metropolitan area, yes.