7 ms·

It will never be a good time to buy a house

44 points by fortran77 3y ago

WendyTheWillow 3y ago
Another example of how timing the market is not a good idea, or, “time in the market beats timing the market.” But why is it considered an invariant, the fact that there aren’t houses where people want houses? Wouldn’t it be extremely possible for people to change where it is they’re willing to live and work as a result of the housing market?
- lotsofpulp 3y ago
  Maybe people feel that you either live in an economically booming place, or an economically dying place. And the former is better for income security. Or maybe people like competing, and aspiring to move up the socioeconomic ladder.
- codetrotter 3y ago
  One thing that makes this difficult still is, what if there are two different markets you want to be in. Time in the market for stocks beats timing the market for stocks. Time in the market for housing beats timing the market for housing. But let’s say you have $30k USD. Currently you have this money in stocks, and you are renting an apartment to live in. Time in the stock market should mean that in 15-20 years, those $30k USD you put in stocks today might grow to be worth a fair bit more. But at the same time, you are losing out on owning a house. Instead paying rent to someone else. And in this case it is not possible to know if it would be better to keep the money in stocks and keep renting, or go and get a loan so you can get some little place of your own with the $30k of yours + the $90k or so that a bank will lend you.
  - pharmakom 3y ago
    The equation depends on interest rates and how liquid you want to be, so it’s a very difficult one to answer.
  - WendyTheWillow 3y ago
    There are many ways to invest in real estate, but generally yes there is always an amount of uncertainty in investing.
- huntertwo 3y ago
  People live where they have jobs. Jobs usually exist where there are people - new jobs can be created if some company or industry’s growth demands it. Amazon warehouses and Walmarts exist where there are enough people to justify it. Coffee shops, fast food restaurants, financial services, etc all provide jobs and are located in cities, not rural areas. Water service, electricity, natural gas service do not exist by default. People can’t just choose to change where they want to live.
  - WendyTheWillow 3y ago
    People absolutely can choose to change where they want to live, by educating themselves on what’s available in places they previously thought were uninhabitable to them. Much work can be done remotely, and much other work is done in many different places than it used to be done in, not to mention the possibility of commuting to/from a job in an expanded range as a result of housing scarcity. Moving is very much a growing option for people, and the data for cross state moves shows that to be the case [0]. [0] https://www.census.gov/library/stories/2023/11/state-to-state-migration.html https://www.census.gov/library/stories/2023/11/state-to-stat...
- anonu 3y ago
  > extremely possible for people to change American mobility tends to be pretty high relative to other people in the world - meaning Americans are more likely to uproot and move to a new community, even 100s or 1000s of miles away from what was "home". With WFH the "objective function" has shifted for part of society who can WFH - its less about job location and more about lifestyle, quality of life and cost of living. However, my anecdotal analysis tells me that WFH, while still a strong factor, is beginning to subside. Not so much due to employers demanding employees be in the office but more because theres a shift back to cities after a 3 year trend out of them. On a tangential topic - here's an interesting Pew Research report on mobility - I believe from 2012. So it's quite dated, but is still a good framework to understand how to think about mobility: https://www.pewresearch.org/wp-content/uploads/sites/3/2011/04/American-Mobility-Report-updated-12-29-08.pdf https://www.pewresearch.org/wp-content/uploads/sites/3/2011/...
- anon84873628 3y ago
  Sibling comments talk about living where there are jobs. But people also want to live near family, friends, and the culture they know. Maybe you need to take care of an aging parent. Or have kids in school and don't want to disrupt their life. There are a huge number of social network effects constraining where most people live.
  - WendyTheWillow 3y ago
    I would argue that those social constraints ought not hold in the face of growing housing scarcity, and the predictions that all else will remain static in people’s behavior is usually an inaccurate one.
jeffbee 3y ago
A healthy housing market would be one where nobody has a rational expectation of it being anything other than a depreciating asset in which you live.
- deleted 3y ago
  [deleted]
- lotsofpulp 3y ago
  Assuming you mean detached houses, how can this be without a decrease in demand for land in the area you live in? Either more people want to live where you are living (meaning the location is desirable), or fewer people want to live where you are living (meaning it is undesirable). Technically, you could have a decline in population, but immigration will probably make up for that for a long time.
- voisin 3y ago
  That would be more aligned with renting. For most people, their house is the biggest purchase they’ll ever make. It isn’t unreasonable to expect it to at least keep pace with inflation so they can sell it and afford to move into a nursing home someday. (Even with the massive growth we’ve seen in recent years, for most long term holders the annual rate of growth has significantly underperformed the markets, even before accounting for maintenance and taxes) If it was simply a depreciating asset, housing would have to be sold for less than the construction cost in order for people to be able to sustain the depreciating value and have enough cash left over to invest elsewhere for their later years drawdown.
  - Wowfunhappy 3y ago
    We can wish whatever we'd like. The logical, real-world value of a house should depreciate over time as the structure gets older and needs more repairs. The exception, I suppose, is if the overall supply of houses and/or land decreases, but then you lock newcomers out of the market.
    - voisin 3y ago
kshahkshah 3y ago
https://archive.is/9x1Rm https://archive.is/9x1Rm
weregiraffe 3y ago
Relevant comic: http://www.threepanelsoul.com/comic/moral-dilemmas http://www.threepanelsoul.com/comic/moral-dilemmas
ulizzle 3y ago
Buying a house in 2019 was one of the top 5 worst decisions in my life
- FirmwareBurner 3y ago
  Why?
  - pixl97 3y ago
    Yea, I don't understand myself, at least if they are in the US. Could be very location dependant, but mostly housing prices greatly increased since then.
    - ulizzle 3y ago
      I don’t want to sell, I was hoping to be buried in the backyard when I died.
      - fakecontent000 3y ago
        [dead]
      - FirmwareBurner 3y ago
        But you haven't explained why it was a bad decision to buy.
        ulizzle 3y ago
        My mortgage is up a thousand bucks due to interest rates. It was a an FHA loan so it made sense at the time
- deleted 3y ago
  [deleted]
- mfcl 3y ago
  How so? It's probably worth more now. You can sell, no?
1970-01-01 3y ago
The Atlantic isn't even trying anymore. Timing varies by region. It is a very good time to buy a house in the mid-west. Its sad how their paywall's first line is "Uncompromising quality." https://fortune.com/2023/10/19/midwest-housing-market-real-estate-price-predictions/ https://fortune.com/2023/10/19/midwest-housing-market-real-e...
underseacables 3y ago
I feel like we got really lucky.. We bought in 2014 and sold in the summer of 2019, moved and bought another place in October of that year. Interest was 3% and 3.5% respectively. Granted we moved from one southern major suburb to another in the Midwest...but the price wasn't that great of a jump. The author of this piece is using as a base line the two most expensive housing markets in America. That's not really representatives of 95% of people. It's understandable not being able to afford to buy in Manhattan, or San Francisco, but have they tried Dayton, Ohio, Houston, Louisville, maybe Orlando? Every single one of these articles about how outrageous, housing prices are always seem to hedge around this idea that buying a place is only worth it if you get to live in a very cosmopolitan, walkable neighborhood. Those are few, and in high demand, so it would reason they would command a higher price.
- pixl97 3y ago
  Unless you're working remotely those prices in Dayton are expensive as the local wages are much lower. People at the bottom end of income need places to live/rent too. And these days with collusion in the rental markets renting is a great way to go broke faster than ever.
  - mcntsh 3y ago
    You can look at census data and clearly see that the median income/property price is much better in Dayton OH than NYC * https://www.census.gov/quickfacts/fact/table/daytoncityohio/INC110221 https://www.census.gov/quickfacts/fact/table/daytoncityohio/... * https://www.census.gov/quickfacts/fact/table/newyorkcitynewyork/HSG010222 https://www.census.gov/quickfacts/fact/table/newyorkcitynewy...
- xnx 3y ago
  > The author of this piece is using as a base line the two most expensive housing markets in America. That's not really representatives of 95% of people. Those two cities are expensive, but I think there are a lot of other expensive cities too (Austin, Los Angeles, etc.) I checked with Bard, and it looks like 9.2% of the US population lives in New York or San Francisco: "The New York metropolitan area is home to 22.1 million people, or 6.6% of the US population. The San Francisco Bay Area is home to 8.7 million people, or 2.6% of the US population."
spacemark 3y ago
The only sensible financial reaction is to save, save, save for a down payment well in excess of 20%. Just an extra 5% will save you roughly $150k On a 600k home over the course of a 30-yr 6.9% mortgage (the current rate). Problem is that most people will never be able to achieve this - the average down payment for first home buyers is less than 10%. Truly hate to say it but people will need to get used to buying homes much later in life.
- pixl97 3y ago
  With more collusion occurring in rental markets, home owners are able to extract more wealth from those that do not own homes. Unless something changes in supply (of which current owners will not want) then 'get used to not buying homes' is really what's being said.
  - spacemark 3y ago
    I hear you, it's not a good place to be in (I've been renting my whole adult life). If people can't or are unwilling to swallow that bitter pill, perhaps major shifts are coming.
    - jorvi 3y ago
      You can get there with social housing through either: - the Singapore model, rent-to-own via the government - the Japanese model, housing is a depreciating asset - the Vienna model, ubiquitous social housing up to mid-tier of the market Personally I feel like renting or owning a house should be a choice of features, not of financial benefit. Buying a house should be about being able to make it your own (moving walls, redoing the garden, building a shed). On a 5, 15, 30, 60 year timeline, owning and renting a house should come out to the same financial net outcome. The way to get there is murky to me. I have far too little understanding of the deeper effects government policies have on the real estate market to make even the roughest guess.
- s1artibartfast 3y ago
  >The only sensible financial reaction is to save, save, save for a down payment well in excess of 20% Perhaps at todays rate, but this is not always the case and depends on the relative rates. We did the opposite, Maxed out our loan and kept cash on hand.
mupuff1234 3y ago
That kind of sentiment is usually strongest before a crash.
zukzuk 3y ago
If interest rates to drop again in the foreseeable future, it will likely be due to an old fashioned recession. If that happens, both mortgage rates and home prices will fall (due to lower demand / ability to pay and possibly forced selling). The article doesn’t mention this scenario, even though it’s entirely probable. If you are waiting on the sidelines, that might actually be a good time to buy. Of course the catch is that if the recession is bad enough to crash the housing market, you may find yourself out of a job and unable to afford anything, so the premise of the article stands — it may never be a good time to buy a house, at least not in the average buyer’s circumstances.
- mattlondon 3y ago
  If it is a "good time to buy" then prices will rise again as demand increases from (presumably) cash buyers or investors buying up things cheap. Unless you mean in minor towns and cities, where prices are only kept up by hope and expectations. Any meaningful "dip" in prices in somewhere like NYC or London and you'll find huge action from foreign investors as they swoop in to capitalise In my opinion, house prices never "go down" in major world cities - you'll perhaps have a little 3-5% wobble for a year or so, but typically prizes just stay the same for a long time if it is a "bad market". Then when conditions improve they just start going up again. You only ever see major corrections in the xx% range of permanent decreases in places where it was a bubble and no one wanted to live in the first place. You'll very likely never get this in a NYC, SF, London type place unless there is some other huge once-in-250-years mayjor even type thing (e.g. London getting flattened in WW2 etc)
  - zukzuk 3y ago
    I guess the point I’m trying to make is that there’s a big difference between “good time to buy” for the “average” buyer vs someone who has been hoarding capital waiting to jump in at a better time. A recession probably will create a good opportunity for those who have been waiting and are in a position to avoid getting hammered by that recession. That is probably not the “average” buyer, but maybe more representative of some of the people here on this forum.
dmurray 3y ago
> That’s in part thanks to mortgage rates. The monthly payment on a new home has increased by more than 50 percent in the past three years, as 30-year mortgage rates have climbed from less than 3 percent to nearly 8 percent. Sounds like it's not just "in part", but more than 100% due to rising interest rates. A $1mm 30 year mortgage at 3% fixed means paying $4200 a month [0]. The same mortgage at 8% requires monthly payments of more than $7,000 [1]. If the author's figures are accurate, houses have not got more expensive at all. Credit has become more expensive. [0] https://www.saving.org/loan/loans.php?loan=1,200,000&rate=3&down=200,000&years=30 https://www.saving.org/loan/loans.php?loan=1,200,000&rate=3&... [1] https://www.saving.org/loan/loans.php?loan=1,200,000&rate=8&down=200,000&years=30 https://www.saving.org/loan/loans.php?loan=1,200,000&rate=8&...
- hiddencost 3y ago
  Only people who can do all cash offers can afford a home
- pixl97 3y ago
  Well, kind of both. Houses increased in prices until Q3 2022. https://fred.stlouisfed.org/series/ASPUS https://fred.stlouisfed.org/series/ASPUS After that point the 'sale' value dropped, but the interest increase has made houses massively more expensive.
- zukzuk 3y ago
  Worth noting that this way of thinking is true in the inverse too — when interest rates were super low, house values didn’t really go up, only credit got cheaper. In other words, the appreciation in costs is not about house value, it’s about the cost of a loan. But underneath, it really is just under-supply of homes. People are competing for limited housing, but instead of hitting a natural ceiling of affordability, they’ve continued to compete on prices by out-borrowing each other to offer ever-higher bids. We now seem to be hitting the next ceiling — buyers are unable leverage their bids any higher. I can’t wait to see what “innovations” the financial sector comes up with to create a new ceiling. I’m guessing fractional ownership or something like that.
  - 3y ago
jacknews 3y ago
A housing 'market' just makes no sense. It's all the downsides of a market, with speculation, supply/demand-strikes, etc, etc, but then it's not actually a 'market' in the sense that new supply cannot be simply conjured to meet demand (land is finite, and of course location, location, location) - so any 'demand market signals' only go to inflate the price, not stimulate production. Truly, economics is the dismal science, and it's wholesale embrace by govt and society is making our lives dismal too.
- pixl97 3y ago
  I mean, you're being downvoted, but you're not wrong. >Housing can’t both be a good investment and be affordable
  - mcntsh 3y ago
    In Germany housing is both not a good investment nor affordable :)
    - bigblue19 3y ago
      [flagged]
- hotpotamus 3y ago
  > Truly, economics is the dismal science, and it's wholesale embrace by govt and society is making our lives dismal too. Yes, I think of this a lot in the context of healthcare; applying market economics to human morbidity and mortality is just grim and macabre. At points it is unavoidable I'm sure, but in the end you end up with unanswerable questions regarding the value of human life. I sort of get the feeling that in that context, "Logan's Run" was basically the optimal economic solution.
  - erik_seaberg 3y ago
    The thing I keep coming back to is, we spend huge sums on grueling end-of-life interventions that a doctor himself might be reluctant to receive.
skepticATX 3y ago
The time to relax zoning laws is here, and has been here for decades. Manhattan is an outlier, but other cities have no reason for being as expensive as they are. Not everyone needs or wants a four bedroom single family home, but in many cities this is all that is available. On top of that, we need to invest in better public transit and infrastructure outside of the core of our cities, so that more people can live where they work.
- Ralfp 3y ago
  In 1936 interwar Poland tried to address catastrophic situation with housing market by relaxing zoning law: If you could buy plot of land, you could build a housing there. Result was few richest poles first race”ing to buy all the land around cities and then build on those plots apartment blocks for rich poles and foreigners to rent units at. It was post-war communist govt that started building cheap living blocks en masse in ruined cities. Today those neighborhoods have reputation for being some best places to live due to quality of urban planning: a lot of space between blocks and walking distance to services, schools and health care.
wouldbecouldbe 3y ago
It would be nice to live in a world where not everything is so complicated. You work so hard, finally build up some savings, only to realise the government doesn't want to explicitly tax wealth so they do so covertly by printing extra money. Not only that, but in order to stimulate the economy they've been forcefully keeping the interest rates as low as possible for over a decade forcing the house prices through the roof. So if you decided buying a house was too risky because getting a high mortgage would expose you to too much leverage, you missed out on the wealth shift to real estate owners that low interest rate created as a side effect. Yet even though on paper a lot of the house owners are now more wealthy, they are at risk of losing a lot of money if the interest rates go up more. The house you bought for 800k might be worth a lot less in a few years, or maybe not. Now I don't know if things would be better without all the monetary games, but they for sure would be simpler.
- tommychillfiger 3y ago
  God I totally agree with this sentiment. I'm certainly not expert enough to know if we're better or worse off with all of these ridiculous financial instruments, but it sure seems like a bunch of bullshit designed to fleece people. It feels like money and value have been separated, if that makes sense. A lot of this stuff really just feels like it's designed specifically to create a gradient of information so that those in the know can make money off those who aren't. A lot of it also just feels like ridiculous betting to me which feels wrong given the stakes. Useless hand waving comment here, but I agree generally that it just feels way too difficult and complicated to work hard at an honest job and pay for a decent life. And I have it way better than most. Can't imagine what the hell I'd be doing right now if I was still a sound guy or barista.
baz00 3y ago
Fundamentally this is correct but there are less bad times to do it. In the UK for example, if you have reasonable capital in the bank, high interest rates and collapsing BTL market then buying something immediately is crack smoking insanity which will lose you £50k in the first year you do it with little to no equity return. You foot all the risk immediately.
threemux 3y ago
One thing the government could do right away that would serve to spread out good jobs is move executive branch departments to other states. For example, let's move the USDA to somewhere in the Midwest. Government employees would move there as would contractor staff and all kinds of ancillary business serving the above. Remote work helps too but the increase in supporting businesses that serve onsite employees is important for an area
- nunez 3y ago
  Federal agencies are pretty distributed already. In fact, there are many (MANY!) small towns throughout the country where the US Government or a contractor that's essentially a feeder for the US Government is the biggest employer there.
- ren_engineer 3y ago
  DC is called the swamp for a reason, spreading those jobs around would make life more difficult for lobbyists and other parasites who extract wealth from tax payers so it will never happen. DC is run like it's still the 1700s despite all the technology that makes it pointless for everything to run in DC. Logically having all leadership concentrated in a single place is a huge risk, but they won't change it
  - dragonwriter 3y ago
    > DC is called the swamp for a reason Two main reaosons: 1. Political propaganda by (mostly, unusually corrupt) politicians cultivating an crusading pure outsider image by encouraging people to focus on negative inages of the soace the politician is seeking to enter and ignore the details of the politicians own personal record, and 2. The fact that it is built on a literal, not at all metaphorical, swamp.
    - ren_engineer 3y ago
      NoVa is the richest area in the nation, even more than NYC or SF. What is produced there? What businesses were founded there to create such wealth? None, it's all wealth extracted from the citizens, and the people in DC mock and look down on the people they need to survive I personally know people who have made millions by lobbying to create BS grants and other funds using tax payer money and then getting money through them. Anybody with actual exposure to DC is disgusted by it.
pharmakom 3y ago
https://archive.ph/sixSq https://archive.ph/sixSq
chx 3y ago
They left out corporate buyers... > Large institutions owned roughly 5% of the 14 million single-family rentals nationally in early 2022. But this relatively low number is deceptive because most of these purchases were past 2009 -- in the past they bought apartment buildings. Also they are focused on inexpensive homes in growing metro areas. So they basically beheaded the market, so to speak. This should never have been allowed but here were are near 15 years in and all that there is a few failed bills. For example: https://www.billtrack50.com/billdetail/1496012/18956 https://www.billtrack50.com/billdetail/1496012/18956
thelastgallon 3y ago
If the entire focus is on structuring the economy for rentier capitalists, this is to be expected. It will get worse as private equity starts owning a lot of single family homes with worse experience for renters[5]. They just started getting their feet wet [2]. This will rapidly increase [3]. Singapore, Japan and Austria[1] (maybe some other countries too!) seem to have solved housing. In contrast, we have Canada, Australia and US. [1] https://www.politico.eu/article/vienna-social-housing-architecture-austria-stigma/ https://www.politico.eu/article/vienna-social-housing-archit... [2] https://www.blackstone.com/housing/our-track-record-in-housing/ https://www.blackstone.com/housing/our-track-record-in-housi... [3]Bezos-Backed Company Surpasses $100M In Single-Family Home Acquisitions While U.S. Housing Shortage Worsens: https://finance.yahoo.com/news/bezos-backed-company-surpasses-100m-175917368.html https://finance.yahoo.com/news/bezos-backed-company-surpasse... [5] Google: blackstone owned homes complaints
orwin 3y ago
I feel like the solution is simply non-market housing. Wether is government housing, or associative housing, non-market housing solve the "rent-controlled" issue: new non-market housing are usually not that cheaper than regular rented housing and do not have any effect on the "new", but as time pass, the rent do not increase (it decrease even if it is associative housing, as the loans are reimbursed). In France, outside the Paris area (Paris is Paris), cities that had a huge "HLM" (non-market housing by the virtue of being regulated by the state) proportion in the 80s built on average more, more quickly. Now the proportion is on average under 10%, and the non-market housing have no more influence on the non-market housing in those places, but i wonder that if the proportion stayed between 20 and 40% non-market housing, even cities like La Rochelle, Nantes or Bordeaux (who are a pain to build around because of historical buildings and swampy surrounding) would be much cheaper. Also in france, non-market housing is like 85% "HLM" (which are also made cheaper because of low build quality), 5% anah (tax credit if you only rent at cost, only available on limited type of houses), which leave 10% for associative housing that is almost exclusively used for athletes and by emmaüs. Associative housing in other countries are not as skewed, and non-market housing is both less regulated and with way better service in Montreal, Vienna and probably other places i've not visited yet.
seiferteric 3y ago
The whole thing is so messed up. Rates are high, so mortgage is expensive, but also prices have not really budged and so you are paying a lot in property tax compared to if you had bought even just a few years ago. Moreover, you are paying so much just to live there you probably don't have much left over to make any improvements... at least until your equity increases and you can take out another loan and start paying monthly for that! It's like it's designed so you are just renting everything from the bank. Houses many decades ago used to cost like as much as a car (or two)! something you could pay off much faster and have money left over to actually do things! That being said, renters have it worse.
- thelastparadise 3y ago
  > It's like it's designed so you are just renting everything from the bank. Nail on the head.
- api 3y ago
  Housing prices are very, very sticky. If housing demand is soft people tend to just hold real estate instead of selling. The only time you see housing fall a lot is when a whole region collapses economically like Detroit in the 1980s. The only way housing gets affordable again is if the entire rest of the economy inflates while housing stands still. That would probably require a combination of inflation and a building boom or inflation with high interest rates. Housing is the great millstone around the neck of the economy. Fundamentally it’s rooted in the fact that our society treats it as both a product and an investment. Housing cannot simultaneously be affordable and a good investment, placing its utility and its quality as an investment at odds and creating perverse incentives everywhere. It’s a horrifically bad system that is deeply entrenched and that tends to benefit older and wealthier people and so would be very hard to change. You can escape the worst of it by leaving high real estate cost traps like the West Coast and Boston/NYC. Telework makes this easier. If you do go to those places just go for a while to establish your career and then leave.
nunez 3y ago
maybe i'm wrong since i'm not an economist, but i see tons of new apartment complexes all over the country being built in sites where houses would have been in the past, which, to me, indicates that the future is a huge renter class with renting being socially normalized. not sure if this is a good or bad thing. i believe that many of today's social expectations around home ownership are a relic from a time where land was widely available and (suburban) home ownership was a mostly-new concept. i also believe that home ownership is a ton of work and a long-term debt trap for a lot of people. if that's true, i can see the appeal of being able to rent homes that are ready-made and allow for popular types of modifications (painting walls, changing out appliances, adding a new room) with maintenance built in.
MilnerRoute 3y ago
I once saw calculations that your net worth increased just as much from renting as from owning a home -- if you instead invested your down payment in a well-diversified stock portfolio. (If you're talking about a 20- or 30-year mortgage, that gives the original investment time to double, double again, and maybe even double for a third time.) Every time I see an article bemoaning how hard it is to buy a home, I think of that...
kadyn 3y ago
[flagged]
anonu 3y ago
Here is some more perspective I found interesting: | Category | 2019 Averages | 2023 Averages | % Change | |------------------|---------------|---------------|----------| | Home Price | $260,000 | $436,000 | 68% | | Mortgage Rate | 4% | 7.5% | 88% | | Monthly Payment | $1,700 | $3,700 | 117% | | Income to Qualify| $60,000 | $115,000 | 91% | Higher median home prices and higher rates means you need to nearly double your income to qualify - while you'll be paying more than double every month to afford it.
- latchkey 3y ago
  https://www.statista.com/statistics/1117465/downpayment-home-buyers-usa/ https://www.statista.com/statistics/1117465/downpayment-home... 2019: 15,737 2023: 28,000 +56% Adding in the downpayment is more interesting to me because that is also a factor of having savings. When I lived in SF, I had a good high paying job, but I didn't have the $200-250k downpayment. I couldn't even get a shitty house in the avenues. I spent a year looking for a place and finally gave up.
nojvek 3y ago
Probably gonna get downvoted for this. Housing is very supply constrained. High mortgage rates are holding prices somewhat steady. We definitely need more supply and while keeping current demand. What this means: - build more high density homes in city. - make permitting faster but still keep it rigorous. Don’t listen to NIMBYs. For demand: - have less kids. I worry about how shit the next generation will have it. - save more. Live frugal, borrowing is expensive. Don’t compare yourself to the gal with a new $50k car. - Move to a lower cost city if you can. - the govt should probably put brakes on all immigration other than high skilled workers. Includes reducing H1B quotas. The reality is that desirable most metros around the planet have far higher demand than supply. We’re amplifying the bourgeoise land owner class and proletariat worker/renter class dynamics.
zzzcsgo 3y ago
[dead]

44 points by fortran77 3y ago

Another example of how timing the market is not a good idea, or, “time in the market beats timing the market.” But why is it considered an invariant, the fact that there aren’t houses where people want houses? Wouldn’t it be extremely possible for people to change where it is they’re willing to live and work as a result of the housing market?

lotsofpulp 3y ago
Maybe people feel that you either live in an economically booming place, or an economically dying place. And the former is better for income security. Or maybe people like competing, and aspiring to move up the socioeconomic ladder.
codetrotter 3y ago
One thing that makes this difficult still is, what if there are two different markets you want to be in. Time in the market for stocks beats timing the market for stocks. Time in the market for housing beats timing the market for housing. But let’s say you have $30k USD. Currently you have this money in stocks, and you are renting an apartment to live in. Time in the stock market should mean that in 15-20 years, those $30k USD you put in stocks today might grow to be worth a fair bit more. But at the same time, you are losing out on owning a house. Instead paying rent to someone else. And in this case it is not possible to know if it would be better to keep the money in stocks and keep renting, or go and get a loan so you can get some little place of your own with the $30k of yours + the $90k or so that a bank will lend you.
- pharmakom 3y ago
  The equation depends on interest rates and how liquid you want to be, so it’s a very difficult one to answer.
- WendyTheWillow 3y ago
  There are many ways to invest in real estate, but generally yes there is always an amount of uncertainty in investing.
huntertwo 3y ago
People live where they have jobs. Jobs usually exist where there are people - new jobs can be created if some company or industry’s growth demands it. Amazon warehouses and Walmarts exist where there are enough people to justify it. Coffee shops, fast food restaurants, financial services, etc all provide jobs and are located in cities, not rural areas. Water service, electricity, natural gas service do not exist by default. People can’t just choose to change where they want to live.
- WendyTheWillow 3y ago
  People absolutely can choose to change where they want to live, by educating themselves on what’s available in places they previously thought were uninhabitable to them. Much work can be done remotely, and much other work is done in many different places than it used to be done in, not to mention the possibility of commuting to/from a job in an expanded range as a result of housing scarcity. Moving is very much a growing option for people, and the data for cross state moves shows that to be the case [0]. [0] https://www.census.gov/library/stories/2023/11/state-to-state-migration.html https://www.census.gov/library/stories/2023/11/state-to-stat...
anonu 3y ago
> extremely possible for people to change American mobility tends to be pretty high relative to other people in the world - meaning Americans are more likely to uproot and move to a new community, even 100s or 1000s of miles away from what was "home". With WFH the "objective function" has shifted for part of society who can WFH - its less about job location and more about lifestyle, quality of life and cost of living. However, my anecdotal analysis tells me that WFH, while still a strong factor, is beginning to subside. Not so much due to employers demanding employees be in the office but more because theres a shift back to cities after a 3 year trend out of them. On a tangential topic - here's an interesting Pew Research report on mobility - I believe from 2012. So it's quite dated, but is still a good framework to understand how to think about mobility: https://www.pewresearch.org/wp-content/uploads/sites/3/2011/04/American-Mobility-Report-updated-12-29-08.pdf https://www.pewresearch.org/wp-content/uploads/sites/3/2011/...
anon84873628 3y ago
Sibling comments talk about living where there are jobs. But people also want to live near family, friends, and the culture they know. Maybe you need to take care of an aging parent. Or have kids in school and don't want to disrupt their life. There are a huge number of social network effects constraining where most people live.
- WendyTheWillow 3y ago
  I would argue that those social constraints ought not hold in the face of growing housing scarcity, and the predictions that all else will remain static in people’s behavior is usually an inaccurate one.

jeffbee 3y ago

A healthy housing market would be one where nobody has a rational expectation of it being anything other than a depreciating asset in which you live.

deleted 3y ago
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lotsofpulp 3y ago
Assuming you mean detached houses, how can this be without a decrease in demand for land in the area you live in? Either more people want to live where you are living (meaning the location is desirable), or fewer people want to live where you are living (meaning it is undesirable). Technically, you could have a decline in population, but immigration will probably make up for that for a long time.
voisin 3y ago
That would be more aligned with renting. For most people, their house is the biggest purchase they’ll ever make. It isn’t unreasonable to expect it to at least keep pace with inflation so they can sell it and afford to move into a nursing home someday. (Even with the massive growth we’ve seen in recent years, for most long term holders the annual rate of growth has significantly underperformed the markets, even before accounting for maintenance and taxes) If it was simply a depreciating asset, housing would have to be sold for less than the construction cost in order for people to be able to sustain the depreciating value and have enough cash left over to invest elsewhere for their later years drawdown.
- Wowfunhappy 3y ago
  We can wish whatever we'd like. The logical, real-world value of a house should depreciate over time as the structure gets older and needs more repairs. The exception, I suppose, is if the overall supply of houses and/or land decreases, but then you lock newcomers out of the market.
  - voisin 3y ago

kshahkshah 3y ago

https://archive.is/9x1Rm https://archive.is/9x1Rm

weregiraffe 3y ago

Relevant comic: http://www.threepanelsoul.com/comic/moral-dilemmas http://www.threepanelsoul.com/comic/moral-dilemmas

ulizzle 3y ago

Buying a house in 2019 was one of the top 5 worst decisions in my life

FirmwareBurner 3y ago
Why?
- pixl97 3y ago
  Yea, I don't understand myself, at least if they are in the US. Could be very location dependant, but mostly housing prices greatly increased since then.
  - ulizzle 3y ago
    I don’t want to sell, I was hoping to be buried in the backyard when I died.
    - fakecontent000 3y ago
      [dead]
    - FirmwareBurner 3y ago
      But you haven't explained why it was a bad decision to buy.
      - ulizzle 3y ago
        My mortgage is up a thousand bucks due to interest rates. It was a an FHA loan so it made sense at the time
deleted 3y ago
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mfcl 3y ago
How so? It's probably worth more now. You can sell, no?

1970-01-01 3y ago

The Atlantic isn't even trying anymore. Timing varies by region. It is a very good time to buy a house in the mid-west. Its sad how their paywall's first line is "Uncompromising quality." https://fortune.com/2023/10/19/midwest-housing-market-real-estate-price-predictions/ https://fortune.com/2023/10/19/midwest-housing-market-real-e...

underseacables 3y ago

I feel like we got really lucky.. We bought in 2014 and sold in the summer of 2019, moved and bought another place in October of that year. Interest was 3% and 3.5% respectively. Granted we moved from one southern major suburb to another in the Midwest...but the price wasn't that great of a jump. The author of this piece is using as a base line the two most expensive housing markets in America. That's not really representatives of 95% of people. It's understandable not being able to afford to buy in Manhattan, or San Francisco, but have they tried Dayton, Ohio, Houston, Louisville, maybe Orlando? Every single one of these articles about how outrageous, housing prices are always seem to hedge around this idea that buying a place is only worth it if you get to live in a very cosmopolitan, walkable neighborhood. Those are few, and in high demand, so it would reason they would command a higher price.

pixl97 3y ago
Unless you're working remotely those prices in Dayton are expensive as the local wages are much lower. People at the bottom end of income need places to live/rent too. And these days with collusion in the rental markets renting is a great way to go broke faster than ever.
- mcntsh 3y ago
  You can look at census data and clearly see that the median income/property price is much better in Dayton OH than NYC * https://www.census.gov/quickfacts/fact/table/daytoncityohio/INC110221 https://www.census.gov/quickfacts/fact/table/daytoncityohio/... * https://www.census.gov/quickfacts/fact/table/newyorkcitynewyork/HSG010222 https://www.census.gov/quickfacts/fact/table/newyorkcitynewy...
xnx 3y ago
> The author of this piece is using as a base line the two most expensive housing markets in America. That's not really representatives of 95% of people. Those two cities are expensive, but I think there are a lot of other expensive cities too (Austin, Los Angeles, etc.) I checked with Bard, and it looks like 9.2% of the US population lives in New York or San Francisco: "The New York metropolitan area is home to 22.1 million people, or 6.6% of the US population. The San Francisco Bay Area is home to 8.7 million people, or 2.6% of the US population."

spacemark 3y ago

The only sensible financial reaction is to save, save, save for a down payment well in excess of 20%. Just an extra 5% will save you roughly $150k On a 600k home over the course of a 30-yr 6.9% mortgage (the current rate). Problem is that most people will never be able to achieve this - the average down payment for first home buyers is less than 10%. Truly hate to say it but people will need to get used to buying homes much later in life.

pixl97 3y ago
With more collusion occurring in rental markets, home owners are able to extract more wealth from those that do not own homes. Unless something changes in supply (of which current owners will not want) then 'get used to not buying homes' is really what's being said.
- spacemark 3y ago
  I hear you, it's not a good place to be in (I've been renting my whole adult life). If people can't or are unwilling to swallow that bitter pill, perhaps major shifts are coming.
  - jorvi 3y ago
    You can get there with social housing through either: - the Singapore model, rent-to-own via the government - the Japanese model, housing is a depreciating asset - the Vienna model, ubiquitous social housing up to mid-tier of the market Personally I feel like renting or owning a house should be a choice of features, not of financial benefit. Buying a house should be about being able to make it your own (moving walls, redoing the garden, building a shed). On a 5, 15, 30, 60 year timeline, owning and renting a house should come out to the same financial net outcome. The way to get there is murky to me. I have far too little understanding of the deeper effects government policies have on the real estate market to make even the roughest guess.
s1artibartfast 3y ago
>The only sensible financial reaction is to save, save, save for a down payment well in excess of 20% Perhaps at todays rate, but this is not always the case and depends on the relative rates. We did the opposite, Maxed out our loan and kept cash on hand.

mupuff1234 3y ago

That kind of sentiment is usually strongest before a crash.

zukzuk 3y ago

If interest rates to drop again in the foreseeable future, it will likely be due to an old fashioned recession. If that happens, both mortgage rates and home prices will fall (due to lower demand / ability to pay and possibly forced selling). The article doesn’t mention this scenario, even though it’s entirely probable. If you are waiting on the sidelines, that might actually be a good time to buy. Of course the catch is that if the recession is bad enough to crash the housing market, you may find yourself out of a job and unable to afford anything, so the premise of the article stands — it may never be a good time to buy a house, at least not in the average buyer’s circumstances.

mattlondon 3y ago
If it is a "good time to buy" then prices will rise again as demand increases from (presumably) cash buyers or investors buying up things cheap. Unless you mean in minor towns and cities, where prices are only kept up by hope and expectations. Any meaningful "dip" in prices in somewhere like NYC or London and you'll find huge action from foreign investors as they swoop in to capitalise In my opinion, house prices never "go down" in major world cities - you'll perhaps have a little 3-5% wobble for a year or so, but typically prizes just stay the same for a long time if it is a "bad market". Then when conditions improve they just start going up again. You only ever see major corrections in the xx% range of permanent decreases in places where it was a bubble and no one wanted to live in the first place. You'll very likely never get this in a NYC, SF, London type place unless there is some other huge once-in-250-years mayjor even type thing (e.g. London getting flattened in WW2 etc)
- zukzuk 3y ago
  I guess the point I’m trying to make is that there’s a big difference between “good time to buy” for the “average” buyer vs someone who has been hoarding capital waiting to jump in at a better time. A recession probably will create a good opportunity for those who have been waiting and are in a position to avoid getting hammered by that recession. That is probably not the “average” buyer, but maybe more representative of some of the people here on this forum.

dmurray 3y ago

> That’s in part thanks to mortgage rates. The monthly payment on a new home has increased by more than 50 percent in the past three years, as 30-year mortgage rates have climbed from less than 3 percent to nearly 8 percent. Sounds like it's not just "in part", but more than 100% due to rising interest rates. A $1mm 30 year mortgage at 3% fixed means paying $4200 a month [0]. The same mortgage at 8% requires monthly payments of more than $7,000 [1]. If the author's figures are accurate, houses have not got more expensive at all. Credit has become more expensive. [0] https://www.saving.org/loan/loans.php?loan=1,200,000&rate=3&down=200,000&years=30 https://www.saving.org/loan/loans.php?loan=1,200,000&rate=3&... [1] https://www.saving.org/loan/loans.php?loan=1,200,000&rate=8&down=200,000&years=30 https://www.saving.org/loan/loans.php?loan=1,200,000&rate=8&...

hiddencost 3y ago
Only people who can do all cash offers can afford a home
pixl97 3y ago
Well, kind of both. Houses increased in prices until Q3 2022. https://fred.stlouisfed.org/series/ASPUS https://fred.stlouisfed.org/series/ASPUS After that point the 'sale' value dropped, but the interest increase has made houses massively more expensive.
zukzuk 3y ago
Worth noting that this way of thinking is true in the inverse too — when interest rates were super low, house values didn’t really go up, only credit got cheaper. In other words, the appreciation in costs is not about house value, it’s about the cost of a loan. But underneath, it really is just under-supply of homes. People are competing for limited housing, but instead of hitting a natural ceiling of affordability, they’ve continued to compete on prices by out-borrowing each other to offer ever-higher bids. We now seem to be hitting the next ceiling — buyers are unable leverage their bids any higher. I can’t wait to see what “innovations” the financial sector comes up with to create a new ceiling. I’m guessing fractional ownership or something like that.
- 3y ago

jacknews 3y ago

A housing 'market' just makes no sense. It's all the downsides of a market, with speculation, supply/demand-strikes, etc, etc, but then it's not actually a 'market' in the sense that new supply cannot be simply conjured to meet demand (land is finite, and of course location, location, location) - so any 'demand market signals' only go to inflate the price, not stimulate production. Truly, economics is the dismal science, and it's wholesale embrace by govt and society is making our lives dismal too.

pixl97 3y ago
I mean, you're being downvoted, but you're not wrong. >Housing can’t both be a good investment and be affordable
- mcntsh 3y ago
  In Germany housing is both not a good investment nor affordable :)
  - bigblue19 3y ago
    [flagged]
hotpotamus 3y ago
> Truly, economics is the dismal science, and it's wholesale embrace by govt and society is making our lives dismal too. Yes, I think of this a lot in the context of healthcare; applying market economics to human morbidity and mortality is just grim and macabre. At points it is unavoidable I'm sure, but in the end you end up with unanswerable questions regarding the value of human life. I sort of get the feeling that in that context, "Logan's Run" was basically the optimal economic solution.
- erik_seaberg 3y ago
  The thing I keep coming back to is, we spend huge sums on grueling end-of-life interventions that a doctor himself might be reluctant to receive.

skepticATX 3y ago

The time to relax zoning laws is here, and has been here for decades. Manhattan is an outlier, but other cities have no reason for being as expensive as they are. Not everyone needs or wants a four bedroom single family home, but in many cities this is all that is available. On top of that, we need to invest in better public transit and infrastructure outside of the core of our cities, so that more people can live where they work.

Ralfp 3y ago
In 1936 interwar Poland tried to address catastrophic situation with housing market by relaxing zoning law: If you could buy plot of land, you could build a housing there. Result was few richest poles first race”ing to buy all the land around cities and then build on those plots apartment blocks for rich poles and foreigners to rent units at. It was post-war communist govt that started building cheap living blocks en masse in ruined cities. Today those neighborhoods have reputation for being some best places to live due to quality of urban planning: a lot of space between blocks and walking distance to services, schools and health care.

wouldbecouldbe 3y ago

It would be nice to live in a world where not everything is so complicated. You work so hard, finally build up some savings, only to realise the government doesn't want to explicitly tax wealth so they do so covertly by printing extra money. Not only that, but in order to stimulate the economy they've been forcefully keeping the interest rates as low as possible for over a decade forcing the house prices through the roof. So if you decided buying a house was too risky because getting a high mortgage would expose you to too much leverage, you missed out on the wealth shift to real estate owners that low interest rate created as a side effect. Yet even though on paper a lot of the house owners are now more wealthy, they are at risk of losing a lot of money if the interest rates go up more. The house you bought for 800k might be worth a lot less in a few years, or maybe not. Now I don't know if things would be better without all the monetary games, but they for sure would be simpler.

tommychillfiger 3y ago
God I totally agree with this sentiment. I'm certainly not expert enough to know if we're better or worse off with all of these ridiculous financial instruments, but it sure seems like a bunch of bullshit designed to fleece people. It feels like money and value have been separated, if that makes sense. A lot of this stuff really just feels like it's designed specifically to create a gradient of information so that those in the know can make money off those who aren't. A lot of it also just feels like ridiculous betting to me which feels wrong given the stakes. Useless hand waving comment here, but I agree generally that it just feels way too difficult and complicated to work hard at an honest job and pay for a decent life. And I have it way better than most. Can't imagine what the hell I'd be doing right now if I was still a sound guy or barista.

baz00 3y ago

Fundamentally this is correct but there are less bad times to do it. In the UK for example, if you have reasonable capital in the bank, high interest rates and collapsing BTL market then buying something immediately is crack smoking insanity which will lose you £50k in the first year you do it with little to no equity return. You foot all the risk immediately.

threemux 3y ago

One thing the government could do right away that would serve to spread out good jobs is move executive branch departments to other states. For example, let's move the USDA to somewhere in the Midwest. Government employees would move there as would contractor staff and all kinds of ancillary business serving the above. Remote work helps too but the increase in supporting businesses that serve onsite employees is important for an area

nunez 3y ago
Federal agencies are pretty distributed already. In fact, there are many (MANY!) small towns throughout the country where the US Government or a contractor that's essentially a feeder for the US Government is the biggest employer there.
ren_engineer 3y ago
DC is called the swamp for a reason, spreading those jobs around would make life more difficult for lobbyists and other parasites who extract wealth from tax payers so it will never happen. DC is run like it's still the 1700s despite all the technology that makes it pointless for everything to run in DC. Logically having all leadership concentrated in a single place is a huge risk, but they won't change it
- dragonwriter 3y ago
  > DC is called the swamp for a reason Two main reaosons: 1. Political propaganda by (mostly, unusually corrupt) politicians cultivating an crusading pure outsider image by encouraging people to focus on negative inages of the soace the politician is seeking to enter and ignore the details of the politicians own personal record, and 2. The fact that it is built on a literal, not at all metaphorical, swamp.
  - ren_engineer 3y ago
    NoVa is the richest area in the nation, even more than NYC or SF. What is produced there? What businesses were founded there to create such wealth? None, it's all wealth extracted from the citizens, and the people in DC mock and look down on the people they need to survive I personally know people who have made millions by lobbying to create BS grants and other funds using tax payer money and then getting money through them. Anybody with actual exposure to DC is disgusted by it.

pharmakom 3y ago

https://archive.ph/sixSq https://archive.ph/sixSq

chx 3y ago

They left out corporate buyers... > Large institutions owned roughly 5% of the 14 million single-family rentals nationally in early 2022. But this relatively low number is deceptive because most of these purchases were past 2009 -- in the past they bought apartment buildings. Also they are focused on inexpensive homes in growing metro areas. So they basically beheaded the market, so to speak. This should never have been allowed but here were are near 15 years in and all that there is a few failed bills. For example: https://www.billtrack50.com/billdetail/1496012/18956 https://www.billtrack50.com/billdetail/1496012/18956

thelastgallon 3y ago

If the entire focus is on structuring the economy for rentier capitalists, this is to be expected. It will get worse as private equity starts owning a lot of single family homes with worse experience for renters[5]. They just started getting their feet wet [2]. This will rapidly increase [3]. Singapore, Japan and Austria[1] (maybe some other countries too!) seem to have solved housing. In contrast, we have Canada, Australia and US. [1] https://www.politico.eu/article/vienna-social-housing-architecture-austria-stigma/ https://www.politico.eu/article/vienna-social-housing-archit... [2] https://www.blackstone.com/housing/our-track-record-in-housing/ https://www.blackstone.com/housing/our-track-record-in-housi... [3]Bezos-Backed Company Surpasses $100M In Single-Family Home Acquisitions While U.S. Housing Shortage Worsens: https://finance.yahoo.com/news/bezos-backed-company-surpasses-100m-175917368.html https://finance.yahoo.com/news/bezos-backed-company-surpasse... [5] Google: blackstone owned homes complaints

orwin 3y ago

I feel like the solution is simply non-market housing. Wether is government housing, or associative housing, non-market housing solve the "rent-controlled" issue: new non-market housing are usually not that cheaper than regular rented housing and do not have any effect on the "new", but as time pass, the rent do not increase (it decrease even if it is associative housing, as the loans are reimbursed). In France, outside the Paris area (Paris is Paris), cities that had a huge "HLM" (non-market housing by the virtue of being regulated by the state) proportion in the 80s built on average more, more quickly. Now the proportion is on average under 10%, and the non-market housing have no more influence on the non-market housing in those places, but i wonder that if the proportion stayed between 20 and 40% non-market housing, even cities like La Rochelle, Nantes or Bordeaux (who are a pain to build around because of historical buildings and swampy surrounding) would be much cheaper. Also in france, non-market housing is like 85% "HLM" (which are also made cheaper because of low build quality), 5% anah (tax credit if you only rent at cost, only available on limited type of houses), which leave 10% for associative housing that is almost exclusively used for athletes and by emmaüs. Associative housing in other countries are not as skewed, and non-market housing is both less regulated and with way better service in Montreal, Vienna and probably other places i've not visited yet.

seiferteric 3y ago

The whole thing is so messed up. Rates are high, so mortgage is expensive, but also prices have not really budged and so you are paying a lot in property tax compared to if you had bought even just a few years ago. Moreover, you are paying so much just to live there you probably don't have much left over to make any improvements... at least until your equity increases and you can take out another loan and start paying monthly for that! It's like it's designed so you are just renting everything from the bank. Houses many decades ago used to cost like as much as a car (or two)! something you could pay off much faster and have money left over to actually do things! That being said, renters have it worse.

thelastparadise 3y ago
> It's like it's designed so you are just renting everything from the bank. Nail on the head.
api 3y ago
Housing prices are very, very sticky. If housing demand is soft people tend to just hold real estate instead of selling. The only time you see housing fall a lot is when a whole region collapses economically like Detroit in the 1980s. The only way housing gets affordable again is if the entire rest of the economy inflates while housing stands still. That would probably require a combination of inflation and a building boom or inflation with high interest rates. Housing is the great millstone around the neck of the economy. Fundamentally it’s rooted in the fact that our society treats it as both a product and an investment. Housing cannot simultaneously be affordable and a good investment, placing its utility and its quality as an investment at odds and creating perverse incentives everywhere. It’s a horrifically bad system that is deeply entrenched and that tends to benefit older and wealthier people and so would be very hard to change. You can escape the worst of it by leaving high real estate cost traps like the West Coast and Boston/NYC. Telework makes this easier. If you do go to those places just go for a while to establish your career and then leave.

nunez 3y ago

maybe i'm wrong since i'm not an economist, but i see tons of new apartment complexes all over the country being built in sites where houses would have been in the past, which, to me, indicates that the future is a huge renter class with renting being socially normalized. not sure if this is a good or bad thing. i believe that many of today's social expectations around home ownership are a relic from a time where land was widely available and (suburban) home ownership was a mostly-new concept. i also believe that home ownership is a ton of work and a long-term debt trap for a lot of people. if that's true, i can see the appeal of being able to rent homes that are ready-made and allow for popular types of modifications (painting walls, changing out appliances, adding a new room) with maintenance built in.

MilnerRoute 3y ago

I once saw calculations that your net worth increased just as much from renting as from owning a home -- if you instead invested your down payment in a well-diversified stock portfolio. (If you're talking about a 20- or 30-year mortgage, that gives the original investment time to double, double again, and maybe even double for a third time.) Every time I see an article bemoaning how hard it is to buy a home, I think of that...

kadyn 3y ago

[flagged]

anonu 3y ago

Here is some more perspective I found interesting: | Category | 2019 Averages | 2023 Averages | % Change | |------------------|---------------|---------------|----------| | Home Price | $260,000 | $436,000 | 68% | | Mortgage Rate | 4% | 7.5% | 88% | | Monthly Payment | $1,700 | $3,700 | 117% | | Income to Qualify| $60,000 | $115,000 | 91% | Higher median home prices and higher rates means you need to nearly double your income to qualify - while you'll be paying more than double every month to afford it.

latchkey 3y ago
https://www.statista.com/statistics/1117465/downpayment-home-buyers-usa/ https://www.statista.com/statistics/1117465/downpayment-home... 2019: 15,737 2023: 28,000 +56% Adding in the downpayment is more interesting to me because that is also a factor of having savings. When I lived in SF, I had a good high paying job, but I didn't have the $200-250k downpayment. I couldn't even get a shitty house in the avenues. I spent a year looking for a place and finally gave up.

nojvek 3y ago

Probably gonna get downvoted for this. Housing is very supply constrained. High mortgage rates are holding prices somewhat steady. We definitely need more supply and while keeping current demand. What this means: - build more high density homes in city. - make permitting faster but still keep it rigorous. Don’t listen to NIMBYs. For demand: - have less kids. I worry about how shit the next generation will have it. - save more. Live frugal, borrowing is expensive. Don’t compare yourself to the gal with a new $50k car. - Move to a lower cost city if you can. - the govt should probably put brakes on all immigration other than high skilled workers. Includes reducing H1B quotas. The reality is that desirable most metros around the planet have far higher demand than supply. We’re amplifying the bourgeoise land owner class and proletariat worker/renter class dynamics.

zzzcsgo 3y ago

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