3 ms·
Housing prices in my area have literally doubled in the last 5~ years. Sitting on a house doesn't look so bad with those returns. At the same time flipping is a
by Klinky 5y ago
Housing prices in my area have literally doubled in the last 5~ years. Sitting on a house doesn't look so bad with those returns. At the same time flipping is also a housing investment method that inflates prices while often diluting the quality of the housing market, as it's often not done properly.
Let's also not forget the housing crisis saw a lot of money pouring into bad investments. Assuming people only make wise investments is naive. The market is crazy right now with people paying over asking and waiving inspections. A lot of people are going to ride that train over the cliff.
- JumpCrisscross 5y ago> Sitting on a house doesn't look so bad with those returns Those returns are underwritten by voters rejecting new housing. If that political landscape changes, the incentives for landholders evolve.
- Klinky 5y agoI dunno, I do see "luxury" apartments being built rather often around here, but starting at $2K/mn for a 1 bedroom isn't really affordable. Political NIMBYism probably does play some part along with the pandemic, but again, that doesn't mean these investors are paying attention to that. There is a gold rush on at the moment.
- ajmurmann 5y agoPeople who move into these more expensive units leave other, less-luxury units though that now someone else can move into. Of course, as someone else pointed out, there is actually pent up demand outside of major cities as well by people wanting to move to the city. But still our only realistic, long term solution out of this mess that 40 years of insufficient construction had gotten us into is unprecedented construction. Upzone and remove barriers to get permits.
- imtringued 5y agoSomeone is willing to pay that much, they will pay that much for an old apartment if they must.
- treeman79 5y agoThat, and inflation showing up in certain areas.