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Well what has happened is that asset price increase go up faster than what a person can save. I lived at home and saved money, then the covid house bubble came

by vinyl7 3y ago

Well what has happened is that asset price increase go up faster than what a person can save. I lived at home and saved money, then the covid house bubble came and doubled the prices. Now i would have to save for another decade. Nope sorry, I'm out. Everyone who thinks they have decent equity in their house is going to feel pain when no one can afford their million dollar condos in a few years

fsckboy 3y ago
all what you're talking about is priced into what I'm talking about. housing prices and rent go up at the same rates, their prices compete in the same market, and if you want to rent a place out, you have to buy the places first. How much rent does it take to pay for the place you bought? It's all linear math, it's proportionate. Stock market investments go toward value creation, housing market purchases do not. Stock market better, it goes up faster.
- dragonwriter 3y ago
  > housing prices and rent go up at the same rates, Naive expectation is that they should, but in practice they don’t. https://www.sfchronicle.com/bayarea/article/rent-own-housing-real-estate-data-17346873.php https://www.sfchronicle.com/bayarea/article/rent-own-housing...
  - fsckboy 3y ago
    your article says what I said, not what you are saying. It points out: The “rule of thumb ideal” is 15, he said: “It tends to correlate with a mortgage payment that is roughly affordable for most households, and a rental rate that is also roughly affordable for most renters.” That's basically saying that there is a linear relationship as I said. (yes, short term prices can move independently from long term because liquidity, menu prices, etc, it's why economists always say "in the long run") and the article asks "How long can it last?", i.e. they are admitting that the prices will come back into alignment, which wouldn't happen if there was no alignment to be had. The article does not mention "naive expectation" at all, you made that part up. Would it surprise you to meet somebody on HN who knows more about the math of finance than you and the SF Chron put together?
    - dragonwriter 3y ago
      > your article says what I said, not what you are saying. No, it says what I said: they don’t, in practice, move together, though ideally they should. Here’s an article with a national chart since 2000 against a year 2000=100 baseline, again note that they do not, in fact, move together, though they usually (but not always) move in the same direction: https://seekingalpha.com/article/4583749-house-prices-vs-rents https://seekingalpha.com/article/4583749-house-prices-vs-ren... > (“yes, short term prices can move independently from long term because liquidity, menu prices, etc, it’s why economists always say “in the long run”) Yes, that’s what economists say when they need an excuse for making statements that are non-actionable and not predictive of real behavior on any meaningful timescale. “But this long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task, if in tempestuous seasons they can only tell us, that when the storm is long past, the ocean is flat again.” John Maynard Keynes, The Tract on Monetary Reform (1923) > Would it surprise you to meet somebody on HN who knows more about the math of finance than you and the SF Chron put together? It would not. Neither would it surprise me to find someone who claims that while getting basic facts wrong and failing reading comprehension. HN is quite diverse in that way.
      - fsckboy 3y ago
        I pointed out where your article said what I said, and you didn't refute it, and now you are linking seekingalpha (which is a completely unreliable amateur opinion site, but) where it again reinforces my position, they call discrepancies in rent-vs-buy prices an "incredible disequilibrium", i.e. a condition that is not stable, i.e. one that will correct completely compatible with what I said. You have gas stations sprinkled around your town: are their price variations more correlated, or uncorrelated? Stop being silly. I'm trying to educate people about a meaningful economic phenomenon that affects their pocketbook and you're trying to win a silly point on a minor technicality that's not of use to anybody. Quoting Keynes as being anti-economics is a joke. People don't buy houses because they think it's short-run cheaper, they believe it is short-run more expensive, but in the long-run cheaper. You think they are making a mistake differentiating between the short and long run, and Keynes has your back? No you don't, so just stop. Your reading comprehension of the material you are digging up is laughable.

by vinyl7 3y ago

fsckboy 3y ago

all what you're talking about is priced into what I'm talking about. housing prices and rent go up at the same rates, their prices compete in the same market, and if you want to rent a place out, you have to buy the places first. How much rent does it take to pay for the place you bought? It's all linear math, it's proportionate. Stock market investments go toward value creation, housing market purchases do not. Stock market better, it goes up faster.

dragonwriter 3y ago
> housing prices and rent go up at the same rates, Naive expectation is that they should, but in practice they don’t. https://www.sfchronicle.com/bayarea/article/rent-own-housing-real-estate-data-17346873.php https://www.sfchronicle.com/bayarea/article/rent-own-housing...
- fsckboy 3y ago
  your article says what I said, not what you are saying. It points out: The “rule of thumb ideal” is 15, he said: “It tends to correlate with a mortgage payment that is roughly affordable for most households, and a rental rate that is also roughly affordable for most renters.” That's basically saying that there is a linear relationship as I said. (yes, short term prices can move independently from long term because liquidity, menu prices, etc, it's why economists always say "in the long run") and the article asks "How long can it last?", i.e. they are admitting that the prices will come back into alignment, which wouldn't happen if there was no alignment to be had. The article does not mention "naive expectation" at all, you made that part up. Would it surprise you to meet somebody on HN who knows more about the math of finance than you and the SF Chron put together?
  - dragonwriter 3y ago
    > your article says what I said, not what you are saying. No, it says what I said: they don’t, in practice, move together, though ideally they should. Here’s an article with a national chart since 2000 against a year 2000=100 baseline, again note that they do not, in fact, move together, though they usually (but not always) move in the same direction: https://seekingalpha.com/article/4583749-house-prices-vs-rents https://seekingalpha.com/article/4583749-house-prices-vs-ren... > (“yes, short term prices can move independently from long term because liquidity, menu prices, etc, it’s why economists always say “in the long run”) Yes, that’s what economists say when they need an excuse for making statements that are non-actionable and not predictive of real behavior on any meaningful timescale. “But this long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task, if in tempestuous seasons they can only tell us, that when the storm is long past, the ocean is flat again.” John Maynard Keynes, The Tract on Monetary Reform (1923) > Would it surprise you to meet somebody on HN who knows more about the math of finance than you and the SF Chron put together? It would not. Neither would it surprise me to find someone who claims that while getting basic facts wrong and failing reading comprehension. HN is quite diverse in that way.
    - fsckboy 3y ago
      I pointed out where your article said what I said, and you didn't refute it, and now you are linking seekingalpha (which is a completely unreliable amateur opinion site, but) where it again reinforces my position, they call discrepancies in rent-vs-buy prices an "incredible disequilibrium", i.e. a condition that is not stable, i.e. one that will correct completely compatible with what I said. You have gas stations sprinkled around your town: are their price variations more correlated, or uncorrelated? Stop being silly. I'm trying to educate people about a meaningful economic phenomenon that affects their pocketbook and you're trying to win a silly point on a minor technicality that's not of use to anybody. Quoting Keynes as being anti-economics is a joke. People don't buy houses because they think it's short-run cheaper, they believe it is short-run more expensive, but in the long-run cheaper. You think they are making a mistake differentiating between the short and long run, and Keynes has your back? No you don't, so just stop. Your reading comprehension of the material you are digging up is laughable.