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Reducing the cost of newly built housing does also reduce the resale price of existing old-stock housing, because they're competing for the same buyers.
by mitthrowaway2 3y ago
Reducing the cost of newly built housing does also reduce the resale price of existing old-stock housing, because they're competing for the same buyers.
- cqqxo4zV46cp 3y agoKind of. A house built in, say, 2024 would have to be quite significantly less costly before I’d consider it over a house from, say, ~30 years ago. Construction is making a terrible name for itself. I am far from alone in this mentality.
- thereisnospork 3y agoSure, but the market will/would equilibrate to a price differential for new vs. old stock. What that differential is ( and how it matches to your personal valuation) is irrelevant to the net validation decrease.
- bombcar 3y agoIt really depends on the area and builders and buyers - around here 30 years puts you right into the last building boom, so the average house from then isn’t necessarily well build, and is much worse from an energy/HVAC viewpoint.
- OtherShrezzing 3y agoIn urban areas, the limiting factor in urban housing supply isn't the cost of construction, it's the finite quantity of land with a valid state-granted construction permit. We could innovate until the cost of construction approached $0, but if there's fewer homes supplied than there are people demanding them, the prices will rise. This is why in Brooklyn, an entire townhouse can cost $2.7m, while the neighbouring plot of empty land costs $2.4m, then a short walk away an un-permited empty plot is $700k. The item of value in the housing market market is weirdly mostly not houses.