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> A house is a deprecative asset, the same way cars are. A house does not produce anything. You live in it and it wears down. This is 100% inaccurate. Land,

> A house is a deprecative asset, the same way cars are. A house does not produce anything. You live in it and it wears down. This is 100% inaccurate. Land, which is the real "value" in owning a home does not depreciate, nor can you make more of it. As more and more people mature and look to enter the real-estate market they can either: - Pay more to live where they want and convince someone to move - move further away, to a new subdivision. Next, not all cars depreciate, nor do houses. If properly maintained they last a long time. Head over to your local car show and see what it costs to buy a car from the 1960's now vs what is cost back then. I once owned a house built in 1915 and it was still in great shape. > i) Price controls do not work at reducing prices, there are two millennia worth of proof for this.[1] Strongly agree. it is insane when renters protest they want more and more rent control. It simply doesn't work and demanding more of something that has failed to do anything is odd.

MichaelZuo 4y ago
Land most often does not wear down, but the built structure obviously does. And even for a condo in a desirable neighbourhood in Manhattan, >50% the value of the property is likely in the value of the structure. i.e. the land value portion would be <50% So the parent is accurate.
- kennend3 4y ago
  https://spearswms.com/10-oldest-houses-in-the-world/ https://spearswms.com/10-oldest-houses-in-the-world/ Yep, some of these homes from 1700's are just so worn out.. They must be worth absolutely nothing. Suggest you head over and offer $1 for them?
  - MichaelZuo 4y ago
    This seems like a non-sequitur?
    - kennend3 4y ago
      Hardly, it simply follows your logic. These houses are very old, and must be worn out. Therefor they would have depreciated to zero...
      - MichaelZuo 4y ago
        Where does my logic imply that the value of that exact house's structure has depreciated to zero or $1? It's very likely the land is worth more than the structure, but that doesn't mean the value of said structure is literally nothing.
        kennend3 4y ago
        It would seem you struggle with the definition of depreciation. "noun a reduction in the value of an asset with the passage of time, due in particular to wear and tear." Given enough time, depreciation leads to zero, or some "scrap value".. this is literally part of its definition. https://en.wikipedia.org/wiki/Depreciation https://en.wikipedia.org/wiki/Depreciation When house values "fall" this is NOT depreciation, but market forces (supply/demand, interest rates, mortgage rates, government policy...). The point of "depreciation" is normally to allow things to be written off at a reduced value over the assets lifetime. Cars do "depreciate" because over time, they face wear and tear and at the end of their lifespan they are traded in for "scrap value". Homes do not depreciate because there is no logical reason why this asset's value would reduce over time/wear/tear when it can be properly maintained, as is the case of the houses from the 1700's i sent you.
        MichaelZuo 4y ago
        If your not being purposefully obtuse, do you understand the concept of differing timespans? Given enough, time, such as millions of years, yes any human made structure will likely depreciate to zero value. Because even solid granite can be eroded down into dust from simple weathering, let alone normal building materials. That doesn't guarantee any specific structure, such as the one you linked, will depreciate to zero within human timescales. And obviously if structures are maintained they will probably not. That doesn't invalidate the concept of wear and tear or depreciation. If you maintain a structure you are by definition putting resources such as energy, materials, labor, etc., into it, so maintenance isn't free. Those resources represent a real cost that someone has to pay for.
- stdbrouw 4y ago
  Let's say the price in your desirable NYC neighborhood is between $1,000 and $2,000 per square foot. New construction is between $100 and $200 per square foot, so $900 to $1,800 has to be for the land it's built on, no? (And if that's a 10 floor condo, the underlying land value is actually 10x that number.) Even in not-so-fancy neighborhoods, you're paying a lot for the land itself these days. I live in a <1M provincial city in Belgium in a semi-detached house, and a property assessor calculated that our house represents 30-35% of the total value of our property.
  - kennend3 4y ago
    > and a property assessor calculated that our house represents 30-35% of the total value of our property. THIS! I live in Ontario (Canada) and my property assessment shows something similar, the value of the home is ~40% of the assessed value. There are plots of land in Toronto where the house is not livable selling for north of a million dollars. Given they have no house, it is purely land value.
- kennend3 4y ago
  Using Toronto as an example because it is closer to home and i am more familair with it. Given your choice of spelling, it would appear Manhattan is not your core knowledge as well? https://www.blogto.com/real-estate-toronto/2022/10/toronto-condos-smaller-1990s/#:~:text=The%20average%20condo%20built%20in,a%2035%20per%20cent%20decrease https://www.blogto.com/real-estate-toronto/2022/10/toronto-c.... "As land values increase, we see more units on a single property, which means many of those individual units are smaller," said Greg Martino, MPAC Vice President and Chief Valuation and Standards Officer. MPAC is responsible for determining property values in Ontario, so do they know a thing or two about this topic. (https://www.mpac.ca/en https://www.mpac.ca/en) If structures wear down, how long until they reach zero value? Have you seen many houses for sale in the zero dollar range because of depreciation? it is not obvious that structures wear down. As i posted below, many of these houses are from the 1700's https://spearswms.com/10-oldest-houses-in-the-world/ https://spearswms.com/10-oldest-houses-in-the-world/ Which one do you feel has depreciated to zero?
  - worik 4y ago
    > ? Have you seen many houses for sale in the zero dollar range because of depreciation? Yes. Plenty. It is not unknown. Not common but it definitely happens

MichaelZuo 4y ago

Land most often does not wear down, but the built structure obviously does. And even for a condo in a desirable neighbourhood in Manhattan, >50% the value of the property is likely in the value of the structure. i.e. the land value portion would be <50% So the parent is accurate.

kennend3 4y ago
https://spearswms.com/10-oldest-houses-in-the-world/ https://spearswms.com/10-oldest-houses-in-the-world/ Yep, some of these homes from 1700's are just so worn out.. They must be worth absolutely nothing. Suggest you head over and offer $1 for them?
- MichaelZuo 4y ago
  This seems like a non-sequitur?
  - kennend3 4y ago
    Hardly, it simply follows your logic. These houses are very old, and must be worn out. Therefor they would have depreciated to zero...
    - MichaelZuo 4y ago
      Where does my logic imply that the value of that exact house's structure has depreciated to zero or $1? It's very likely the land is worth more than the structure, but that doesn't mean the value of said structure is literally nothing.
      - kennend3 4y ago
        It would seem you struggle with the definition of depreciation. "noun a reduction in the value of an asset with the passage of time, due in particular to wear and tear." Given enough time, depreciation leads to zero, or some "scrap value".. this is literally part of its definition. https://en.wikipedia.org/wiki/Depreciation https://en.wikipedia.org/wiki/Depreciation When house values "fall" this is NOT depreciation, but market forces (supply/demand, interest rates, mortgage rates, government policy...). The point of "depreciation" is normally to allow things to be written off at a reduced value over the assets lifetime. Cars do "depreciate" because over time, they face wear and tear and at the end of their lifespan they are traded in for "scrap value". Homes do not depreciate because there is no logical reason why this asset's value would reduce over time/wear/tear when it can be properly maintained, as is the case of the houses from the 1700's i sent you.
        MichaelZuo 4y ago
        If your not being purposefully obtuse, do you understand the concept of differing timespans? Given enough, time, such as millions of years, yes any human made structure will likely depreciate to zero value. Because even solid granite can be eroded down into dust from simple weathering, let alone normal building materials. That doesn't guarantee any specific structure, such as the one you linked, will depreciate to zero within human timescales. And obviously if structures are maintained they will probably not. That doesn't invalidate the concept of wear and tear or depreciation. If you maintain a structure you are by definition putting resources such as energy, materials, labor, etc., into it, so maintenance isn't free. Those resources represent a real cost that someone has to pay for.
stdbrouw 4y ago
Let's say the price in your desirable NYC neighborhood is between $1,000 and $2,000 per square foot. New construction is between $100 and $200 per square foot, so $900 to $1,800 has to be for the land it's built on, no? (And if that's a 10 floor condo, the underlying land value is actually 10x that number.) Even in not-so-fancy neighborhoods, you're paying a lot for the land itself these days. I live in a <1M provincial city in Belgium in a semi-detached house, and a property assessor calculated that our house represents 30-35% of the total value of our property.
- kennend3 4y ago
  > and a property assessor calculated that our house represents 30-35% of the total value of our property. THIS! I live in Ontario (Canada) and my property assessment shows something similar, the value of the home is ~40% of the assessed value. There are plots of land in Toronto where the house is not livable selling for north of a million dollars. Given they have no house, it is purely land value.
kennend3 4y ago
Using Toronto as an example because it is closer to home and i am more familair with it. Given your choice of spelling, it would appear Manhattan is not your core knowledge as well? https://www.blogto.com/real-estate-toronto/2022/10/toronto-condos-smaller-1990s/#:~:text=The%20average%20condo%20built%20in,a%2035%20per%20cent%20decrease https://www.blogto.com/real-estate-toronto/2022/10/toronto-c.... "As land values increase, we see more units on a single property, which means many of those individual units are smaller," said Greg Martino, MPAC Vice President and Chief Valuation and Standards Officer. MPAC is responsible for determining property values in Ontario, so do they know a thing or two about this topic. (https://www.mpac.ca/en https://www.mpac.ca/en) If structures wear down, how long until they reach zero value? Have you seen many houses for sale in the zero dollar range because of depreciation? it is not obvious that structures wear down. As i posted below, many of these houses are from the 1700's https://spearswms.com/10-oldest-houses-in-the-world/ https://spearswms.com/10-oldest-houses-in-the-world/ Which one do you feel has depreciated to zero?
- worik 4y ago
  > ? Have you seen many houses for sale in the zero dollar range because of depreciation? Yes. Plenty. It is not unknown. Not common but it definitely happens