3 ms·

It's not like Vermont is lacking in space for new construction, so it's turtles all the way down with a shortage of construction workers as well. In this case

It's not like Vermont is lacking in space for new construction, so it's turtles all the way down with a shortage of construction workers as well. In this case I don't even know if it's purely the economics of the housing bubble being prohibitive, or rather the societal aspiration to get in on the housing bubble that does it. A sibling commenter acted as if $16k/yr in interest was no big deal. And I guess it's not if one mentally accounts for it as a cost to be carried while the "investment" line goes up-right ("stonks!"). But if the housing bubble ever gets reformed in the slightest, very few places in Vermont are going to be appreciating like that. So that's $2400/mo rent mostly just going down the drain for a depreciating asset? I'd say that deal only makes sense for people planning to retire in that same house.

toomuchtodo 3y ago
Housing will end up like daycare or long term care: too expensive for the free market, only widely available with policy and government economic support. We under built for too long and as structural demographics squeezes the participation rate, labor costs will exceed what affordable housing can tolerate due to the median wage. A labor light cone if you will. Existing home inventory in the aggregate has a labor cost profile built into them that no longer exists.
- mindslight 3y ago
  I'm generally predisposed against looking at government for quick fixes. But I can't not think similar to you on housing. The government has already been dumping trillions of dollars into the housing bubble over the past several decades mainly just bidding up existing stock, putting us here. (the greatest trick Nixonite/Reaganite looters ever pulled was convincing us money "loaned" into the financial industry is distinct from "government spending") Rather than the disastrous approach of goal-blind subsidized mortgages, that government money needs to be directed to projects that accomplish deliberate policy goals. What VT would seem to need here is low-frills, semi-shared style housing for younger people that haven't really chosen a path in life but will be attracted by the low rent. The market just can't build something like that in VT - if nobody comes, it will be worth nothing. Whereas building the same thing outside Los Angeles will practically guarantee popularity (despite the permit pain), or even just a few hundred miles south as part of the Northeast Megalopolis will be a much surer thing (although more sprawling beige boxes on overwrought postage stamp lawns is still a surer bet, and predictability is the main need of leveraged money) Also, I feel like there's an analog to your comment about wages in general. General wages were held down so long by MBA cogification, over-management, classism, govt inflation treadmill, etc that now labor in general is too expensive for the free market. Nobody knows how much say working in a chocolate factory should actually pay. And if you're interested in chocolate, you'll probably be more successful starting a website drop shipping someone else's chocolate with your own branding...
  - toomuchtodo 3y ago
    It's possible when there is political will. https://news.ycombinator.com/item?id=38117223 https://news.ycombinator.com/item?id=38117223
- hotpotamus 3y ago
  There's a question I've had in the back of my mind for a long time now that I think just came out into the open reading your comment. There seems to be a common sentiment that we've under built. What does that mean? Does it mean less houses per family or less square footage per person or some other measure? Because I often see large, mostly-unoccupied houses when I go on vacation somewhere scenic, and it makes me wonder how large of an effect that that sort of thing might have on the market.
  - toomuchtodo 3y ago
    https://www.fanniemae.com/research-and-insights/perspectives/us-housing-shortage https://www.fanniemae.com/research-and-insights/perspectives... https://www.fanniemae.com/media/45106/display https://www.fanniemae.com/media/45106/display > The causes of the housing supply crisis are widely understood. After the Great Recession, new home construction dropped like a stone. Fewer new homes were built in the 10 years ended 2018 than in any decade since the 1960s. By 2019, a good estimate of the shortage of housing units for sale or rent was 3.8 million. The pandemic-induced materials and labor shortage exacerbated the trend, however, as evidenced by the surge in rents and home prices in 2021.
    - hotpotamus 3y ago
      Still, I wonder how much square footage of housing was built; not just units. I'm under the impression that the average house built in the 10's era is larger than one built half a century before which could mean that more housing is being built (by area or volume) and yet fewer units are available. I guess I'm one of those anti-consumerist, people-should-live-in-modest-housing malcontents, but I grew up in a family of four in a small house, and we got by no problem.
      - lotsofpulp 3y ago
        Yes, the housing construction metrics are not exactly comparable over time because constructing the tiny 1k sq ft or less houses on postage stamp lots probably became illegal in most of the US many years ago.
- s1artibartfast 3y ago
  I think it is also possible that it will correct towards scales and formats that are more economical. Houses can be built that take minimal labor to construct and maintain. We lived in them for most of human history.

toomuchtodo 3y ago

Housing will end up like daycare or long term care: too expensive for the free market, only widely available with policy and government economic support. We under built for too long and as structural demographics squeezes the participation rate, labor costs will exceed what affordable housing can tolerate due to the median wage. A labor light cone if you will. Existing home inventory in the aggregate has a labor cost profile built into them that no longer exists.

mindslight 3y ago
I'm generally predisposed against looking at government for quick fixes. But I can't not think similar to you on housing. The government has already been dumping trillions of dollars into the housing bubble over the past several decades mainly just bidding up existing stock, putting us here. (the greatest trick Nixonite/Reaganite looters ever pulled was convincing us money "loaned" into the financial industry is distinct from "government spending") Rather than the disastrous approach of goal-blind subsidized mortgages, that government money needs to be directed to projects that accomplish deliberate policy goals. What VT would seem to need here is low-frills, semi-shared style housing for younger people that haven't really chosen a path in life but will be attracted by the low rent. The market just can't build something like that in VT - if nobody comes, it will be worth nothing. Whereas building the same thing outside Los Angeles will practically guarantee popularity (despite the permit pain), or even just a few hundred miles south as part of the Northeast Megalopolis will be a much surer thing (although more sprawling beige boxes on overwrought postage stamp lawns is still a surer bet, and predictability is the main need of leveraged money) Also, I feel like there's an analog to your comment about wages in general. General wages were held down so long by MBA cogification, over-management, classism, govt inflation treadmill, etc that now labor in general is too expensive for the free market. Nobody knows how much say working in a chocolate factory should actually pay. And if you're interested in chocolate, you'll probably be more successful starting a website drop shipping someone else's chocolate with your own branding...
- toomuchtodo 3y ago
  It's possible when there is political will. https://news.ycombinator.com/item?id=38117223 https://news.ycombinator.com/item?id=38117223
hotpotamus 3y ago
There's a question I've had in the back of my mind for a long time now that I think just came out into the open reading your comment. There seems to be a common sentiment that we've under built. What does that mean? Does it mean less houses per family or less square footage per person or some other measure? Because I often see large, mostly-unoccupied houses when I go on vacation somewhere scenic, and it makes me wonder how large of an effect that that sort of thing might have on the market.
- toomuchtodo 3y ago
  https://www.fanniemae.com/research-and-insights/perspectives/us-housing-shortage https://www.fanniemae.com/research-and-insights/perspectives... https://www.fanniemae.com/media/45106/display https://www.fanniemae.com/media/45106/display > The causes of the housing supply crisis are widely understood. After the Great Recession, new home construction dropped like a stone. Fewer new homes were built in the 10 years ended 2018 than in any decade since the 1960s. By 2019, a good estimate of the shortage of housing units for sale or rent was 3.8 million. The pandemic-induced materials and labor shortage exacerbated the trend, however, as evidenced by the surge in rents and home prices in 2021.
  - hotpotamus 3y ago
    Still, I wonder how much square footage of housing was built; not just units. I'm under the impression that the average house built in the 10's era is larger than one built half a century before which could mean that more housing is being built (by area or volume) and yet fewer units are available. I guess I'm one of those anti-consumerist, people-should-live-in-modest-housing malcontents, but I grew up in a family of four in a small house, and we got by no problem.
    - lotsofpulp 3y ago
      Yes, the housing construction metrics are not exactly comparable over time because constructing the tiny 1k sq ft or less houses on postage stamp lots probably became illegal in most of the US many years ago.
s1artibartfast 3y ago
I think it is also possible that it will correct towards scales and formats that are more economical. Houses can be built that take minimal labor to construct and maintain. We lived in them for most of human history.