4 ms·

>do you expect the 40% price hike during Covid to become permanent? Definitely. US real estate is literally the best investment real estate in the entire world

>do you expect the 40% price hike during Covid to become permanent? Definitely. US real estate is literally the best investment real estate in the entire world, and it's availabile to the entire world. Prices definitely won't be going down. Edit: This comment has nothing to do with whether or not the US is a desirable place to live. The value of US real estate is tremendous simply because the US dollar is the hegemonic international currency and the US holds the only meaningful military power in the west. And finally, one does not have to live in a property to invest in it.

xwolfi 3y ago
You may misunderstand how the "entire world" thinks about it. I'm French and live in Hong Kong so I'm exposed to a lot of European and Asian real estate experience, have friends with everything from a villa in Vietnam to a flat in Berlin etc. So the way we see the US is: - it's risky to live there, for many reasons (high crime, gun ownership, children mass murders, rampant untreated schizophrenia, drug abuse issues) - it's optimized for gasoline consumption, you can't really live near your work as much as elsewhere, the city center isn't as interesting as in Asia/Europe and suburbs are very low-density, copy-pasted houses, so the "value" of a property is more flimsy than other places. - it's expensive with low speculative upside: it's a very mature market, it might conserve some value but it won't like double like in Saigon, Bangkok or Lisbon, and it won't "last forever" like Paris or Hong Kong who have structural reasons to be expensive (Paris as capital of a European geographical center between 6 rich countries, Hong Kong as a gateway in and out of China). To give you a random example: Seattle is quite "new" and particularly useless / unknown to, say, a successful Tokyo upstart. It's considerably more expensive than what it should be from an Asian point of view. - Visas are annoyingly complex vs very open economies (in term of real estate investment) and the US is far down the ranking of countries you trust to access your property easily. I'd rather have a small thing in Singapore that I know I'll always be welcome to visit, than something huge in Ohio which will make me feel like shit each time I have to fill paperwork to see. - Political instability seems to have taken hold and we never know if foreigners will be barred from the US on a whim because of some flu. It doesn't feel that much better than China, which is considered one of the worst market to invest in around me (basically you have random chances to simply see your house unreachable for years there, or disappear). I feel "the rest of the world" considers the US as average, not too dangerous but not too profitable to invest in. Most of my friends are very wary of investing there. I would never myself. All these may be factually wrong btw, this is just how I hear the market talks around me, in the rest of the world: the US "brand" is not very popular, is all.
- mlhpdx 3y ago
  If risk isn’t proportional to reward,… well it is almost always. Emerging markets are riskier and more rewarding (when the risk isn’t active), mature markets are less risky and less rewarding (unless comparative emerging markets craters). I personally don’t think the term of loans or the maturity of the US market has much to do with the low volume of home sales. Rather, it’s a combination of loss aversion (as others have pointed out) and general uncertainty.
- jdksmdbtbdnmsm 3y ago
  I didn't say anything about living here. See "investment real estate"
  - xwolfi 3y ago
    Same, but why would others live there ? When you invest in real estate, you expect, I hope, to rent. Sure you can just wait it out and lose in estate taxes, but normally: you expect people to live there. Sadly, since living conditions in the US are deteriorating, dangerous, and unattractive, your investment... is the same: people won't pay a fortune in rent for the privilege of being mugged in their sleep (exaggerating for effect). And again I'm not even saying that it's actually like that there, but that's how we seem to perceive the US from abroad: we're not jumping on it, it's scary and strange, and it doesn't bring as much yield as safer, less unstable countries. I'd rather buy a losing property in Japan, making up for the value loss (automatic there due to earthquake damages) in stable unchanging rent, with an asset I can safely visit when needed, or at least just access when needing to sell. If you just want real estate exposure you make a REIT mix and pray the Gods you won't be scammed, from a few click in your broker's app. When you buy a real thing, you don't touch the US.
    - jdksmdbtbdnmsm 3y ago
      >Same, but why would others live there ? Because has more theoretical opportunity than where they live and they can't move to Europe. This is not complicated.
ZoomerCretin 3y ago
They will go down if we adopt California-style zoning reform, or enact other policies that allow the supply of housing to increase.
- jdksmdbtbdnmsm 3y ago
  Not a chance, which is why housing prices aren't going down in any parts of the US, including the vast majority of the US that has none of the "California-style" laws that insufferable developers like you despise.
  - ZoomerCretin 3y ago
    Except housing prices _did_ go down in areas that adopted zoning reform that allows for more apartments to be built at lower prices.
metaphor 3y ago
> US real estate is literally the best investment real estate in the entire world, and it's availabile to the entire world. Apparently, we haven't learned shit from the Great Financial Crisis on what happens when we take a basic living essential, and rather than shepherd it as a vehicle for responsible capital preservation, the market instead shills it as growth investment. No doubt in my mind that real estate speculation will go down as this century's most epic tragedy of the commons.
- jdksmdbtbdnmsm 3y ago
  The defining characteristic of capitalism is the opportunity to exercise capital to accumulate more capital.
  - metaphor 3y ago
    Indeed, an apt agentless response in defense of parasitic excess that so readily cannibalizes its host for a quick buck just before collapse...which is doubly curious given the Fed has been telling us for well over a year now that not exercising capital to accumulate more capital is the name of the game.

xwolfi 3y ago

You may misunderstand how the "entire world" thinks about it. I'm French and live in Hong Kong so I'm exposed to a lot of European and Asian real estate experience, have friends with everything from a villa in Vietnam to a flat in Berlin etc. So the way we see the US is: - it's risky to live there, for many reasons (high crime, gun ownership, children mass murders, rampant untreated schizophrenia, drug abuse issues) - it's optimized for gasoline consumption, you can't really live near your work as much as elsewhere, the city center isn't as interesting as in Asia/Europe and suburbs are very low-density, copy-pasted houses, so the "value" of a property is more flimsy than other places. - it's expensive with low speculative upside: it's a very mature market, it might conserve some value but it won't like double like in Saigon, Bangkok or Lisbon, and it won't "last forever" like Paris or Hong Kong who have structural reasons to be expensive (Paris as capital of a European geographical center between 6 rich countries, Hong Kong as a gateway in and out of China). To give you a random example: Seattle is quite "new" and particularly useless / unknown to, say, a successful Tokyo upstart. It's considerably more expensive than what it should be from an Asian point of view. - Visas are annoyingly complex vs very open economies (in term of real estate investment) and the US is far down the ranking of countries you trust to access your property easily. I'd rather have a small thing in Singapore that I know I'll always be welcome to visit, than something huge in Ohio which will make me feel like shit each time I have to fill paperwork to see. - Political instability seems to have taken hold and we never know if foreigners will be barred from the US on a whim because of some flu. It doesn't feel that much better than China, which is considered one of the worst market to invest in around me (basically you have random chances to simply see your house unreachable for years there, or disappear). I feel "the rest of the world" considers the US as average, not too dangerous but not too profitable to invest in. Most of my friends are very wary of investing there. I would never myself. All these may be factually wrong btw, this is just how I hear the market talks around me, in the rest of the world: the US "brand" is not very popular, is all.

mlhpdx 3y ago
If risk isn’t proportional to reward,… well it is almost always. Emerging markets are riskier and more rewarding (when the risk isn’t active), mature markets are less risky and less rewarding (unless comparative emerging markets craters). I personally don’t think the term of loans or the maturity of the US market has much to do with the low volume of home sales. Rather, it’s a combination of loss aversion (as others have pointed out) and general uncertainty.
jdksmdbtbdnmsm 3y ago
I didn't say anything about living here. See "investment real estate"
- xwolfi 3y ago
  Same, but why would others live there ? When you invest in real estate, you expect, I hope, to rent. Sure you can just wait it out and lose in estate taxes, but normally: you expect people to live there. Sadly, since living conditions in the US are deteriorating, dangerous, and unattractive, your investment... is the same: people won't pay a fortune in rent for the privilege of being mugged in their sleep (exaggerating for effect). And again I'm not even saying that it's actually like that there, but that's how we seem to perceive the US from abroad: we're not jumping on it, it's scary and strange, and it doesn't bring as much yield as safer, less unstable countries. I'd rather buy a losing property in Japan, making up for the value loss (automatic there due to earthquake damages) in stable unchanging rent, with an asset I can safely visit when needed, or at least just access when needing to sell. If you just want real estate exposure you make a REIT mix and pray the Gods you won't be scammed, from a few click in your broker's app. When you buy a real thing, you don't touch the US.
  - jdksmdbtbdnmsm 3y ago
    >Same, but why would others live there ? Because has more theoretical opportunity than where they live and they can't move to Europe. This is not complicated.

ZoomerCretin 3y ago

They will go down if we adopt California-style zoning reform, or enact other policies that allow the supply of housing to increase.

jdksmdbtbdnmsm 3y ago
Not a chance, which is why housing prices aren't going down in any parts of the US, including the vast majority of the US that has none of the "California-style" laws that insufferable developers like you despise.
- ZoomerCretin 3y ago
  Except housing prices _did_ go down in areas that adopted zoning reform that allows for more apartments to be built at lower prices.

metaphor 3y ago

> US real estate is literally the best investment real estate in the entire world, and it's availabile to the entire world. Apparently, we haven't learned shit from the Great Financial Crisis on what happens when we take a basic living essential, and rather than shepherd it as a vehicle for responsible capital preservation, the market instead shills it as growth investment. No doubt in my mind that real estate speculation will go down as this century's most epic tragedy of the commons.

jdksmdbtbdnmsm 3y ago
The defining characteristic of capitalism is the opportunity to exercise capital to accumulate more capital.
- metaphor 3y ago
  Indeed, an apt agentless response in defense of parasitic excess that so readily cannibalizes its host for a quick buck just before collapse...which is doubly curious given the Fed has been telling us for well over a year now that not exercising capital to accumulate more capital is the name of the game.