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I agree with your overall point but > even though we've been in a bubble for the past 20 years what is a "bubble", to you? the last 20 years includes one of t

I agree with your overall point but > even though we've been in a bubble for the past 20 years what is a "bubble", to you? the last 20 years includes one of the greatest housing crashes of all time, and a period of some of the cheapest housing costs we've ever seen.

orangecat 4y ago
Prices did fall after the 2008 crash, but only back to where they were around 2003: https://fred.stlouisfed.org/series/CSUSHPINSA https://fred.stlouisfed.org/series/CSUSHPINSA. Of course there may have been more of a drop in particular locations.
- thatfrenchguy 4y ago
  People bought with a mortgage though, and rates went down.
  - chordalkeyboard 4y ago
    lower rates mean higher prices, ceteris paribus
pessimizer 4y ago
> the last 20 years includes one of the greatest housing crashes of all time, We can call it a housing pause at this point, because all of that money was put back into houses. I think it is unbelievably important to remember as a baseline that world housing prices tracked inflation for 400 years. In the US they tracked inflation, there was a bump up with government housing subsidy right after WWII, then it continued to track inflation until the dot com bubble burst After which there was hockey stick price growth, a crash, massive government intervention and transfer payments to the wealthy, mass evictions of people who couldn't pay after their ARMs moved, massive buy-ups of that property by large investors and funds, and the restoration of hockey stick price growth. > a period of some of the cheapest housing costs we've ever seen. Where? Are there any places that fell back to the 380 year trend line, or are there places that are reasonable compared to their price in 2006 considering inflation. We're still in a period of the most expensive housing costs ever. They've grown to precisely what they need to be to take away any disposable income, along with education and healthcare. They're completely detached from physical considerations, they're simple financial instruments. And property owners have tricked people into thinking that it's a supply problem.
- mercutio2 4y ago
  Are you adjusting for size/quality? Because it's certainly true that there have been real (not just nominal) housing cost increases, but my understanding is the increase is much less extreme if you compare apples to apples. Americans have just decided to consume a lot more square-footage of living space than they used to, is a large part of the story outside of tightly constrained markets.
  - aschearer 4y ago
    Doesn't the Shiller index account for that? It's currently at 307 compared to 213 two years ago. A decade ago it was 134. Hard to look at the curve and avoid the conclusion that things are way more expensive now than anytime in the past. [1]: https://fred.stlouisfed.org/series/CSUSHPINSA https://fred.stlouisfed.org/series/CSUSHPINSA
    - sgerenser 4y ago
      Yes, Case-Schiller index is same-home sales. The only thing it doesn’t account for is upgrades/additions but I doubt those are prevalent enough to change the numbers much.
  - bombcar 4y ago
    We also have higher population and it’s literally illegal to build houses like many that are in the older/cheaper parts of town. The sq ft of the “minimal viable house” keeps growing.
  - confidantlake 4y ago
    I suspect in most cities it is the land that is valuable not the house. Even the 1940s-1950s houses where I live are selling for 800k. I suspect that an empty lot would sell for slightly more since they get immediately torn down and something bigger put up whenever they sell. And I am just in some random suburb of a city that is not even close to top 10 in terms of population or wealth.

orangecat 4y ago

Prices did fall after the 2008 crash, but only back to where they were around 2003: https://fred.stlouisfed.org/series/CSUSHPINSA https://fred.stlouisfed.org/series/CSUSHPINSA. Of course there may have been more of a drop in particular locations.

thatfrenchguy 4y ago
People bought with a mortgage though, and rates went down.
- chordalkeyboard 4y ago
  lower rates mean higher prices, ceteris paribus

pessimizer 4y ago

> the last 20 years includes one of the greatest housing crashes of all time, We can call it a housing pause at this point, because all of that money was put back into houses. I think it is unbelievably important to remember as a baseline that world housing prices tracked inflation for 400 years. In the US they tracked inflation, there was a bump up with government housing subsidy right after WWII, then it continued to track inflation until the dot com bubble burst After which there was hockey stick price growth, a crash, massive government intervention and transfer payments to the wealthy, mass evictions of people who couldn't pay after their ARMs moved, massive buy-ups of that property by large investors and funds, and the restoration of hockey stick price growth. > a period of some of the cheapest housing costs we've ever seen. Where? Are there any places that fell back to the 380 year trend line, or are there places that are reasonable compared to their price in 2006 considering inflation. We're still in a period of the most expensive housing costs ever. They've grown to precisely what they need to be to take away any disposable income, along with education and healthcare. They're completely detached from physical considerations, they're simple financial instruments. And property owners have tricked people into thinking that it's a supply problem.

mercutio2 4y ago
Are you adjusting for size/quality? Because it's certainly true that there have been real (not just nominal) housing cost increases, but my understanding is the increase is much less extreme if you compare apples to apples. Americans have just decided to consume a lot more square-footage of living space than they used to, is a large part of the story outside of tightly constrained markets.
- aschearer 4y ago
  Doesn't the Shiller index account for that? It's currently at 307 compared to 213 two years ago. A decade ago it was 134. Hard to look at the curve and avoid the conclusion that things are way more expensive now than anytime in the past. [1]: https://fred.stlouisfed.org/series/CSUSHPINSA https://fred.stlouisfed.org/series/CSUSHPINSA
  - sgerenser 4y ago
    Yes, Case-Schiller index is same-home sales. The only thing it doesn’t account for is upgrades/additions but I doubt those are prevalent enough to change the numbers much.
- bombcar 4y ago
  We also have higher population and it’s literally illegal to build houses like many that are in the older/cheaper parts of town. The sq ft of the “minimal viable house” keeps growing.
- confidantlake 4y ago
  I suspect in most cities it is the land that is valuable not the house. Even the 1940s-1950s houses where I live are selling for 800k. I suspect that an empty lot would sell for slightly more since they get immediately torn down and something bigger put up whenever they sell. And I am just in some random suburb of a city that is not even close to top 10 in terms of population or wealth.