4 ms·

Which part? That 10% of all houses in the US are vacant? A quick Google search shows that 10% is probably low. That they're not competing? What evidence is the

Which part? That 10% of all houses in the US are vacant? A quick Google search shows that 10% is probably low. That they're not competing? What evidence is there of this? Prices aren't falling, after all.

kemotep 3y ago
A vacant 2 bed room 1 bath house in Mansfield Ohio does not help the family of 5 in San Francisco let alone Cleveland. Where the vacancy is and the “quality” so to speak matters a lot. Additionally, some percentage of homes have to be vacant to allow someone to move into it. You will need to provide evidence that the vacancy rate of a specific market is causing prices to go higher. Citing national statistics when talking about a local issue does not help.
- dingosity 3y ago
  Look at my post immediately previous to yours. It links to a Lending Tree study that indicates an inverse relationship between vacancy rate and median home price. Hawaii is an obvious outlier, but interestingly, so is New Jersey. (What's going on in Jersey?) The data in this study is broken down by state; SMSA would probably be better, but I didn't spend a lot of time digging up data.
  - kemotep 3y ago
    That data backs up what I am saying though. The national average means nothing, even state averages means nothing if where you are looking for housing, the vacancies are either not high enough to facilitate moving people around or are in conditions or floor plans that do not fit your needs. Not every vacant unit of housing is equally fungible. California having one of the lowest vacancy rates and one of the highest median housing rates means there potentially needs to be a much higher rate of vacant units to lower housing prices if they are as inversely related as you describe.
dingosity 3y ago
Lending tree did a study which ranked states on % vacant. https://www.lendingtree.com/home/mortgage/vacancy-rates-study/ https://www.lendingtree.com/home/mortgage/vacancy-rates-stud... If you trust the data (some of which comes from the 2020 census), it implies a nation-wide vacancy rate of 11.67%. Which was lower than I suspected, but higher than @falcolas' guess at 10%. Also... I think I saw something go by indicating prices were still falling, at least in some markets. This is from last year: https://www.cnn.com/2022/10/22/homes/us-home-prices-falling/index.html https://www.cnn.com/2022/10/22/homes/us-home-prices-falling/... And more recently: https://www.msn.com/en-us/money/realestate/bay-area-home-prices-could-be-falling-here-s-why/ar-AA1gsjyx https://www.msn.com/en-us/money/realestate/bay-area-home-pri... Though that last one is a little confusing, citing data from the last three months in one section and data over 2 years in another. But it does (at least) make a nod towards explaining pricing in terms of supply and demand. I assert, and I think this is similar to @falcolas' point, that participation in the market by builders, foreign and domestic investors and banks has veered US house pricing noticeably away from true elasticity. I do not damn builders for trying to increase their profits. We're a "wealth creation" economy, after all. But there does seem to be some conflict between stated national policy objectives of "affordable housing" and "profitable housing market." Alas, I bemoan the erosion of sensible policy-making in Washington. In the old days we would have just come out and said something like "we have affordable housing targets and will manipulate the market to achieve them." Now we're too spooked to say anything lest we upset the markets; or at least it seems.

kemotep 3y ago

A vacant 2 bed room 1 bath house in Mansfield Ohio does not help the family of 5 in San Francisco let alone Cleveland. Where the vacancy is and the “quality” so to speak matters a lot. Additionally, some percentage of homes have to be vacant to allow someone to move into it. You will need to provide evidence that the vacancy rate of a specific market is causing prices to go higher. Citing national statistics when talking about a local issue does not help.

dingosity 3y ago
Look at my post immediately previous to yours. It links to a Lending Tree study that indicates an inverse relationship between vacancy rate and median home price. Hawaii is an obvious outlier, but interestingly, so is New Jersey. (What's going on in Jersey?) The data in this study is broken down by state; SMSA would probably be better, but I didn't spend a lot of time digging up data.
- kemotep 3y ago
  That data backs up what I am saying though. The national average means nothing, even state averages means nothing if where you are looking for housing, the vacancies are either not high enough to facilitate moving people around or are in conditions or floor plans that do not fit your needs. Not every vacant unit of housing is equally fungible. California having one of the lowest vacancy rates and one of the highest median housing rates means there potentially needs to be a much higher rate of vacant units to lower housing prices if they are as inversely related as you describe.

dingosity 3y ago

Lending tree did a study which ranked states on % vacant. https://www.lendingtree.com/home/mortgage/vacancy-rates-study/ https://www.lendingtree.com/home/mortgage/vacancy-rates-stud... If you trust the data (some of which comes from the 2020 census), it implies a nation-wide vacancy rate of 11.67%. Which was lower than I suspected, but higher than @falcolas' guess at 10%. Also... I think I saw something go by indicating prices were still falling, at least in some markets. This is from last year: https://www.cnn.com/2022/10/22/homes/us-home-prices-falling/index.html https://www.cnn.com/2022/10/22/homes/us-home-prices-falling/... And more recently: https://www.msn.com/en-us/money/realestate/bay-area-home-prices-could-be-falling-here-s-why/ar-AA1gsjyx https://www.msn.com/en-us/money/realestate/bay-area-home-pri... Though that last one is a little confusing, citing data from the last three months in one section and data over 2 years in another. But it does (at least) make a nod towards explaining pricing in terms of supply and demand. I assert, and I think this is similar to @falcolas' point, that participation in the market by builders, foreign and domestic investors and banks has veered US house pricing noticeably away from true elasticity. I do not damn builders for trying to increase their profits. We're a "wealth creation" economy, after all. But there does seem to be some conflict between stated national policy objectives of "affordable housing" and "profitable housing market." Alas, I bemoan the erosion of sensible policy-making in Washington. In the old days we would have just come out and said something like "we have affordable housing targets and will manipulate the market to achieve them." Now we're too spooked to say anything lest we upset the markets; or at least it seems.