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> I've pondered on this a lot. Houses have been treated as "nest-eggs" There is a nasty policy trap here, in that reducing the investment value of houses can m
by ska 4y ago
> I've pondered on this a lot. Houses have been treated as "nest-eggs"
There is a nasty policy trap here, in that reducing the investment value of houses can mean (as a federal government) you are expecting pain down the road caring for people with insufficient retirement savings.
- yamtaddle 4y agoA crash back to where we'd be with a following-inflation rate of increase in house prices since, say, 1995, would absolutely wipe out a terrifying proportion of the working-age population's on-paper wealth. IDK what the solution is that doesn't completely fuck a generation or three, one way or another. Of course the best answer would have been to never get into this situation in the first place, but here we are.
- Firmwarrior 4y agoIf we just started building enough housing now, things would be fine IMO. No need to bring prices down to a reasonable level and wipe out all the NIMBYs
- nerdponx 4y agoI would settle for prices simply flattening, which at least would cut off the cycle of homeowners expecting property to continue appreciating. We also need to start building different kinds of homes. More "starter homes", fewer McMansions in the suburbs and luxury condo apartments in the cities.
- bombcar 4y agoThe fixed costs basically make it impossible to build anything but high margin. It’s disgustingly.
- JKCalhoun 4y ago> More "starter homes", fewer McMansions Sadly, investors that own the undeveloped property, construction companies — they want the big margins and so build expensive homes. (Which the rest of us buy because that's what's available — a bit like a car dealership lot these days where their entire inventory are the expensive, top-of-the-line models.)
- oceanplexian 4y agoThere are a couple misconceptions with this. There is no such thing as “inflation”, inflation exists in different categories and inflates differently based on supply or demand for different products. It wouldn’t make any sense for housing to inflate at the rate that consumer electronics inflated, they are totally separate markets. If you want a real answer, look at the population now vs. the population in 1995, and the number of housing units now vs. 1995, you’ll see that housing has not kept pace. The prices are a form of equilibrium. Because increasing supply in many locations is physically impossible, prices are unlikely to drop much. Another input people don’t want to talk about much is the price of energy, and the cost of skilled labor which has skyrocketed. The cost of building things is simply more expensive.