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The U.S. Housing Boom Is Coming to an End, Starting in Dallas
- deleted 8y ago[deleted]
- neonate 8y agohttps://outline.com/ZCPPvZ https://outline.com/ZCPPvZ
- downrightmike 8y agoThanks for the full article link.
- briandear 8y agoWhy does HN allow intentional bypass of paywalls? It’s no different than providing links to pirated software. On the one hand, we complain about aggressive advertising while simultaneously doing everything possible to ensure publications don’t earn any money.
- joejerryronnie 8y agoBecause, for all our self righteous indignation, we still want free stuff like everyone else.
- deleted 8y ago[deleted]
- untog 8y agoIt isn't quite the same, because these publications do offer their content for free... to the Google indexer. So they're kind of trying to have it both ways. That said, I agree with the broader point: if you value something that has a price on it then you really ought to pay for it at some point. You can object to anything you want ("there are still ads!", "why can't I pay per article?"), but it's all besides the point. There is a price attached and you can pay it or not pay it, but refusing to pay while still consuming it isn't really defensible, beyond "I can do it and you can't stop me".
- ttty 8y agoI'm not sure, but some paid software is provided for free to some reviews or other people... By the same line of thought... Is fine to pirate them?
- untog 8y agoFair point. I'm not really sure it's a comparison worth exploring too deeply as there are just too many differences. For instance, what's the pirated program equivalent of viewing just one article? I think (hope?) most people here would agree that a hack providing you with a full WSJ subscription would be inappropriate. But many are fine with a single article. Perhaps that's hypocritical, I dunno.
- panzagl 8y agoIf the reviewer normally reviews free games, and it was sent to the reviewer with a stated MSRP of $0, then it is misleading to try to charge everyone else after they read the review.
- el_benhameen 8y agoI think this is a fair question. I think the reaction would be different if e.g. a link to a cracked copy was added to every post about a piece of software.
- diminoten 8y agoBecause information wants to be free. This is "hacker" news, after all.
- stale2002 8y agoWell, an alternative solution would be to ban all links to paywall content. Are you sure that this is what you'd want?
- baroffoos 8y agoIf paywall bypasses are banned then all paywall links should be banned from being posted
- keyle 8y agothank you, that was painful. I tried an incognito tab as well as google searching it, they must be getting clever(er).
- gnicholas 8y agoThere's also free WSJ via the Read Across The Aisle browser plugin and iOS app. It's a side project of mine, and there's no data monitoring or monetization. http://www.readacrosstheaisle.com http://www.readacrosstheaisle.com
- Cyclone_ 8y agoDoesn't surprise me, younger millenials won't have a home to sell and will thus have a hard time affording a home in an inflated market. Compounded with the fact that median wages haven't increased that much the last 30 years. Prices have to fall for that group to afford a home.
- sokoloff 8y ago> Compounded with the fact that median wages haven't increased that much the last 30 years. Median income has gone up by about 150% (to 2.5x) in nominal terms between 1986 and 2016. https://fred.stlouisfed.org/series/MEHOINUSA646N https://fred.stlouisfed.org/series/MEHOINUSA646N
- dmichulke 8y agoIt increased a thousand fold in Venezuela and Zimbabwe - I'm guessing here but it should get the point across
- makmanalp 8y agoWhy look at nominal though? Inflation adjusted makes a lot more sense to me, especially when we're talking about household income. https://fred.stlouisfed.org/series/MEHOINUSA672N https://fred.stlouisfed.org/series/MEHOINUSA672N The story here is quite different - only a 19% increase, and much more unstable over the years. Most of the increase happened before 2000. Almost no change since then.
- sokoloff 8y agoTwo reasons: 1. Every idiotic meme about how goods X, Y, and Z have more than doubled in price while [real] wages haven't. I'm torn between thinking the meme creators are completely clueless or epic trolls. 2. There is a substantial linkage between nominal wages and nominal inflation, especially for limited, competitively bid goods (like housing). Looking at median house prices https://fred.stlouisfed.org/series/CSUSHPINSA https://fred.stlouisfed.org/series/CSUSHPINSA , it looks like they went up slightly more than median wages (2.85x vs 2.5x in 30 years), which I think is likely more than explained by today's lower than historical norms interest rates (increasing affordability). https://www.macrotrends.net/2604/30-year-fixed-mortgage-rate-chart https://www.macrotrends.net/2604/30-year-fixed-mortgage-rate... Mortgage rates over 10% in 1988 and under 5% today means that 1988 houses were less affordable on 1988 wages than 2018 houses are on 2018 wages.
- howlingfantods 8y ago"Some home builders are so desperate to attract interest they are offering agents the chance to win Louis Vuitton handbags or Super Bowl tickets with round-trip airfare, if their clients buy a home." That seems like a serious conflict of interests.
- thinkingkong 8y agoIts not a conflict but its sort of weird. Sellers pay the commissions.
- froindt 8y agoThe buyer's agent is supposed to act in the best interest of the buyer. It's tough to say that's always the case when the buyer paying a bit more rather than walking away would actually help the buyer's agent earn more. Normally there are pre-negotiated commission rates the buyer's agent would receive. To ensure you've got someone who is truly on your side as the buyer, maybe it'd make sense for your agent to be paid for services as consumed. E.g. $50 for doing a private showing, $200 for putting together the first offer and $70 for subsequent offers.
- dvtrn 8y agomaybe it'd make sense for your agent to be paid for services as consumed I've actually heard/read of a few boutique style agencies taking this approach in LA. Will dig around the history and update this post if I find the blog post talking about it.
- prawn 8y agoWhy would you even have a buyer's agent? In Australia, the seller has an agent (often on commission) to arrange ads and conduct opens. Buyers visit and then make an offer if they wish. A buyer's agent would be quite rare - maybe only for very, very expensive properties. Does the buyer's agent in the US handle the role of a conveyancer in sorting paperwork of the final sale?
- 8y ago
- bradleyjg 8y agoThe post housing crash housing boom was almost entirely the result of the federal government--which has made, guaranteed, or bought significantly more than half the residential mortgages since 2008--deciding there should be a housing boom. If it is indeed coming to an end it is because the federal government collectively has decided not to double down and keep the party going. This isn't the weather or even the price of gold. This is policy choices by government officials and should reported that way. I'm not saying (in this post) that it is a good thing or bad thing, but it's what is actually going on and that's what newspapers ought to report.
- toomuchtodo 8y agoThe Federal Reserve (which orchestrates interest rates to manage inflation and achieve full employment [two of its mandates]) is not (edit: a branch) of the US government, and does not set government policy. Edit: This is incorrect. The Board Of Governors who set interest rates is a part of the federal govrnment as an agency (accountable to Congress), the individual Federal Reserve Banks are not.
- freedomben 8y agoWhile it is technically true that the Fed is privately owned, it's not how it runs in actuality. The Fed chairman meets with presidents regularly, and many other politicians. The president also nominates the Chair of the Fed. So hardly independent [1]. [1] https://mises.org/library/myth-fed-independence https://mises.org/library/myth-fed-independence
- deleted 8y ago[deleted]
- pfarnsworth 8y agoBased on how pissed off Trump is that Powell is raising rates, I would say the Fed Chairman is pretty independent.
- pdonis 8y ago
- xienze 8y ago> As mortgage rates rise, buyers increasingly look for less-expensive homes. File that under “duh”. Home buyers want to get the best house they can afford based on a given monthly payment amount, and as interest rates rise, the home price that you can afford for the same monthly payment decreases. Which gives rise to high interest rates actually being a good thing for prospective home buyers: you end up with lower home prices across the board and eventually you’ll be able to refinance into a lower rate.
- JumpCrisscross 8y agoHousing prices go up: “it’s becoming unaffordable!” Housing prices go down: “it’s crashing!” Housing prices stay stable: “our leaders need to revitalise downtown!”
- SomewhatLikely 8y agoHousing prices go down: with these interest rates it's becoming even more unaffordable!
- deleted 8y ago[deleted]
- shmerl 8y agoThere was a boom? All I've observed is a crazy growth of prices, making buying anything very prohibitive.
- bestnameever 8y agoyou just described a boom. https://dictionary.cambridge.org/us/dictionary/english/housing-boom https://dictionary.cambridge.org/us/dictionary/english/housi...
- EpicEng 8y ago>All I've observed is a crazy growth of prices, making buying anything very prohibitive. If only there were a good word for that...
- shmerl 8y agoRenting times :)
- deleted 8y ago[deleted]
- hyperrail 8y agoFunnily enough, Bloomberg BusinessWeek reported almost the same story - even the same example region! - last week: https://www.bloomberg.com/news/articles/2018-11-20/free-vacations-100-000-discounts-homebuilders-get-desperate https://www.bloomberg.com/news/articles/2018-11-20/free-vaca... I wonder if WSJ was chasing Bloomberg? Or if this phenomenon isn't really as strong nationwide as is being implied, but is mostly only in certain parts of Texas?
- jameslk 8y agoFed lowers interest rates with QE and home buying goes up. Fed raises interest rates and home buying goes down. Imagine that. Almost as if this could have all been predicted[0]. 0. https://en.wikipedia.org/wiki/Austrian_business_cycle_theory https://en.wikipedia.org/wiki/Austrian_business_cycle_theory
- gowld 8y agoOf course it's been predicted. Economists have predicted 9 of the last 7 recessions. But besides that, the Fed doing exactly what is was chartered to do and constantly issues press releases about is not a shocking revelation of hetereodox economics.
- jameslk 8y agoThe Fed isn't doing exactly what it was chartered to do--it has had a dual mandate since 1977 that complicates its purpose. Regardless, the problem in this system seems more attributable to fractional reserve banking, which is force multiplier on the effects of central banks.
- NTDF9 8y agoI believe the Fed's mandate is wrongly placed. The Fed should only be responsible for money supply, not for full employment. Full employment should be a burden taken on by elected representatives in congress or the executive. The dual mandate asks a fish to make sure the boat flies.
- yourduskquibble 8y agoAnd the saddest part of your entire comment is that no one will listen when the economic facts are obvious and stop the madness.
- systematical 8y agoOlder Millenial here. Bought my house while prices were still low in late 2013. Cashed out in March of this year. Thought it was crazy it was bubbling like this again. Time will tell if that was dumb or smart but I did pay off all my debt including student loans... I personally think a crash is coming soonish. But that's just my gut.
- pfarnsworth 8y agoAlmost everyone thinks a crash is coming. There has never been a crash where almost everyone has seen it coming. Therefore there will not be a crash at least in the near future. Prices might pullback but it won't be a crash.
- api 8y agoBitcoin? Everyone saw that coming.
- pdelbarba 8y agoA perfect example, though it seems some here are somewhat butthurt :)
- polyomino 8y agoIn order for a market (that's reasonably distributed) to move in a direction, there needs to be some level of consensus. If everyone thinks there will be a crash, then there will be a crash, because everyone will sell.
- mattdeboard 8y agoIsn’t there some logical fallacy about believing that since something has never happened, it will never happen?
- thousandautumns 8y agoIt's called the Black Swan fallacy. Ironically, it's what happened with the recession and housing crisis in 2008, except back then it was "the housing market isn't a bubble, people will never default on their mortgages en masse".
- gwbas1c 8y agoI just built a home. One thing I noticed: Some builders are really stupid about reading the market and knowing what people are willing to pay. They load homes up with luxury features and then wonder why their homes sit vacant. My builder has a vacant home in my neighborhood. He ran Ethernet to all rooms, and put in other silly features, and just couldn't comprehend why his price was too high.
- errantmind 8y agoI don't know the details of this home you refer to, but I'd pay more for a home with ethernet in all rooms
- bhauer 8y agoSo would I, since wired networking is my jam. But I get the point the GP is making. The pool of potential buyers who would appreciate the value of that additional investment is small and (presumably) only getting smaller with time. Anecdote: I realized how out of the mainstream I was when recently viewing a video produced by a high-profile gamer on Youtube showing off the specifications of his desktop gaming rig via Windows Task Manager. Yes, he had gobs of memory, many cores, and dual RTXs. But what caught my eye was that the network chart showed he was using wireless networking. On a desktop PC with two RTX 2080s. It make me laugh a bit; it made me cry a bit.
- com2kid 8y agoModern 5ghz wireless can fully saturate most home broadband connections, and if a good router is used, the added latency is trivial. If the house isn't already wired for CAT5, wireless makes sense.
- bhauer 8y agoTo reiterate: the point of my anecdote was to point out how out of touch I am. Sure, wireless gaming is fine. Still, for me, I can't fathom investing the kind of money this fellow had on a gaming rig to then pair it with wireless networking. The scenario in brief: On one hand, I've opted for a blistering no-compromises frame rate, but on the other, I am tolerating a few more milliseconds of lag. Does not compute. I remember enjoying the analysis that Riot did comparing wireless and wired gaming [1]. The chart showing the percentage of players using wired versus wireless at each of their ranking tiers is especially interesting. In my home, I use Ubiquiti UniFi wireless access points. Comparing my workstation (wired) with my laptop (wireless, situated about 10 feet from an access point), pings to Google are delayed ~1.5ms by wireless with a few more random hiccups. Is that a big deal? No, not really for me. But then, I don't really game nor do I have dual RTX 2080s. [1] https://na.leagueoflegends.com/en/page/ethernet-vs-wifi-ping-packets-playing-better https://na.leagueoflegends.com/en/page/ethernet-vs-wifi-ping...
- neokantian 8y agoI am quite convinced it would be possible to build a pleasantly-looking development of $25,000 sale-value housing at 50 or 70 miles away from the urbanized area and connect it with a fast transit rail to the main urbanization. Empty land should be cheap. Buyers should be plentiful. The reason why this does not happen, is because the bureaucracy prevents it. There seems to be a strong political necessity to make accommodation unaffordable. It is a deliberate policy, of which homelessness is just an unimportant byproduct. It is your risk and fear of becoming homeless that keeps the system afloat. These dangers enslave you to your employer and to the banksters. Be a good slave!
- walrus01 8y ago$25,000 can EASILY be spent, and triple that, just on getting well water, septic and electrical services to a rural property. I could buy 20 acres in Okanogan county WA right now for $18,000 but it'll be at the end of a dirt road, with no sewer, no water, and looking at $30k to extend grid electrical to it (or build a $20k off-grid photovoltaic system). I'm guessing from your comment that you've never actually done the budget on what it costs to turn "cheap" land into somewhere you can build a nice residence.
- aftbit 8y agoHow do you find cheap land like this? I would love to own 20 unimproved acres in rural Washington.
- walrus01 8y agoLook on Zillow, in really small places like Omak you may also need to telephone real estate agents. The way they do business there is like 15 years ago. Edit: randomly chosen example, I have nothing to do with the seller here: https://www.zillow.com/homedetails/2089463438_zpid/ https://www.zillow.com/homedetails/2089463438_zpid/
- mikestew 8y agoUmm, Zillow with the right filters. All the 20 acre plots you want for $20K. You better have a vehicle with some ground clearance.
- gnicholas 8y agoThings have also cooled off in the Palo Alto area. I've seen houses dropped by $400k in the last few months, typically from nearly $2.5M to a bit under $2M. At first I thought it was just to get a bidding war started, but the homes then sold for not much over the lowered price. This is still a far cry from "affordable", but it's a change of pace from the last six years.
- modeless 8y agoI've toured a couple of houses in Palo Alto in the past month. The agents were practically begging us to make an offer below asking price. I thought it was really weird. Of course, even then the prices would still be about double what I would consider reasonable.
- gnicholas 8y agoI'm curious to see how much things soften after people do their 2018 taxes next year and realize the magnitude of the impact of not being able to deduct property taxes anymore. (In CA, the $10k cap is eaten up by state income taxes, at least for anyone who has enough money to purchase a home.)
- tehlike 8y agoIt is a mix. Housing prices have been going up by about 20% for a while except for this year. 1% interest rate increase is more or less equal to price going up 20% in terms of monthly payment. Add lack of salt, and it falls behind.
- 01100011 8y agoValley real estate is insane. The houses are old, tiny and probably full of health hazards(lead, asbestos). The infrastructure is crap. The whole area is earthquake prone. You'd think the smart folks in the area would stay out of the market...but after looking at rentals over the last month I'm starting to understand why people still buy. I think it's stupid...but I understand their perspective.
- davidw 8y agoIDK, looks kind of like supply and demand starting to balance out in an area where that's allowed to happen. Mostly through sprawl, rather than other, denser types of development, but it is allowed.
- lbacaj 8y agoI believe we are seeing normal corrections in the housing market which has been overheated due to low interest rates. It is not some big conspiracy by the government and it is not a big collapse as some are making it out to be. 1/8th of a percent on a 30 year mortgage equals 80 dollars more per month on a 500k home, over 30 years, that is 28 grand more you are paying. The mortgage rates went from low 3% to high 5%, now even at 6%, in a matter of a few years. Of course this will cool the market a bit, people can do the math that much more in interest is hundreds of thousands. This is very different from the 2008 crisis where people that had no business owning homes were defaulting on their loans. This is just supply and demand, standard capitalism. Home prices will come down a bit and they will start selling more homes.
- deleted 8y ago[deleted]
- purplezooey 8y agoThe recent tax bill badly hurts the blue states with high local taxes, and limits housing-related deductions for them. Vote next time, please.
- RoadieRoller 8y agoA wild thought - How much of this is caused by H1B visa restrictions and higher visa rejection rates? Dallas, and Texas in general, is home to the fourth largest Indian population in US. I reckon that these high paid tech people are abstaining from purchasing any real estate owing to the uncertainity in their existence here.