> Houses can basically last an arbitrarily long amount of time and still remain functional. With most things, like a car, there is some nebulous end of life whe

> Houses can basically last an arbitrarily long amount of time and still remain functional. With most things, like a car, there is some nebulous end of life where its value is effectively $0, and the value of that thing will steadily decrease over time until it reaches that point. That's equally true of housing as well. Come on up to Michigan, I can walk you though entire neighborhoods filled with homes that are all functionally obsolete and valueless. Homes actually get worse -- a home can have negative value. If an empty lot costs $60k, it's not uncommon for a house on an equivalent lot to be only worth $50k, because it's assumed you'll have to spend $10k to properly demolish and dispose of the existing home before the lot becomes usable. In this scenario, the homes value is effectively negative $10k. Homes don't hold their value, land and zoning does. And with prices as crazy high as they are today, the actual home cost is almost an afterthought. I suspect if land and zoning actually became affordable, more people would opt to toss and rebuild their old homes with new modern ones, similar to Tokyo residential development.