11 ms·

Household size and the housing stock

78 points by jseliger 2y ago

jelliclesfarm 2y ago
This discussions on house size and housing shortage in a country so big is indicative of a bad labour market and declining quality of life. The economy is in shambles if homes can’t be built for different income groups. The villain here is the govt that eats up the taxes and imposes more and doesn’t provide basic quality of life. Wealth redistribution is not the solution. Wealth management is the answer. America fails miserably. Basically..if a country as large as America is wanting dense housing and smaller homes, it means it’s becoming poorer. For the rest of world..who are resource constrained or resource poor or economically weak…America is laughing stock. It’s like the world’s richest person has a poverty fetish to fit in. The only true wealth in this world is land. And the govt has made if so none can truly own it. And there you have it. The gaslighting is real. Land owning farmers are the richest people in the world. By offering them subsidies, they have become debtors. Land rich and cash poor. The ultimate goal is land grab by institutional investors until very few elite will own all the land…and its resources.
DoreenMichele 2y ago
In the 1950s, average size of new homes was about 1200 square feet. In 2000, it was more than 2400 square feet and held one less person (iirc: 4.5 VS 3.5 people). We are building 1950s suburban homes on steroids in a post-baby-boom world where average household size has shrunk. There are a lot of problems with this.
- zbrozek 2y ago
  You build the biggest thing you can within a parcel because there is plenty of demand at the top of the market. Want more, smaller homes? Reduce or eliminate minimum lot sizes, setbacks, constraints on number of units, and process required towards entitlement. What is legal is what gets built. Not enough is legal, and not enough is built as a result.
  - swatcoder 2y ago
    > You build the biggest thing you can within a parcel because there is plenty of demand at the top of the market. I know many people who have built many homes and I don't know a single one who thought that way or built a house that reflects it. While impacted by practical needs to a degree, preferred home size is just a fashion that changes over time and amounts to personal taste. The 3500sf McMansion of yesterday becomes the "who would want to maintain and heat all that?!" of tomorrow, the cramped matchbox of yesterday becomes the Eco Friendly Tiny Home of tomorrow, etc People build for the intersection of they want to budget and either: what they want to live in, or what their near-term anticipated buyer is assumed to want in light of current trends.
    - vkou 2y ago
      People building their own homes are outliers. Most homes are built by cookie-cutter block developments, and they make the most money by: 1. Minimizing the size of their lots. 2. Maximizing the size of the homes on the lots. They subdivide as much as they are allowed to, and build as big as they are allowed to. If the houses in your city are too big, it's because the smallest allowed lot size is. If we ever caught up with the housing shortage, and there was a glut of housing on the market, maybe developers would start to build smaller, but we aren't there, and we won't be there for the next ~30 years.
      - swatcoder 2y ago
        Again: I know builders. The size of the home is not a structural rule of the building industry, and is not universal or permanent. Just like any business, it's something builders decide based on who their market is and what they think they'll buy. The described strategy might be what you're seeing in your area and might be the only thing that makes sense to your own tastes, but there are plenty of cities and counties where the pressing demand from buyers is for other things. In trend-leading communities, demand has been growing for years for denser housing with immediate access to retail and commerce; for efficient homes with low utility costs or green considerations; for small houses, condos, and townhouses that are well-appointed but accessibly priced and low-maintenance, etc and this is what builders have been building when they've been able to get cleared to build at all.
- willcipriano 2y ago
  Finished basements. The house in 1950 had a unfinished basement and was listed at 1200 sq ft. They finished the basement and later sold it as 2400. The difference is a couple pallets of drywall.
  - thatfrenchguy 2y ago
    No basements in western states :)
    - makeitshine 2y ago
      I've lived in Oregon, Washington, Nevada and Colorado and I've seen and lived in plenty of places with basements.
      - lotsofpulp 2y ago
        On flat land, basements are a function of home (and land) price. In places where the frost line is not very deep, a basement is a luxury. One of the most expensive parts of the house is laying the foundation, and not building a basement is far cheaper than building a basement. If the frost line is lower, then a basement is very little extra cost since you are digging deeper and laying more concrete anyway. If you are building on a hill, then making a 3 story house is also very little extra cost.
    - cafard 2y ago
      My family lived from 1969 through 2006 in a house in Colorado with a basement. My stepmother--who grew up in a region with cooler summers--ight have perished of heat exhaustion but for the basement. What anyone in particular had outside our neighborhood, I can't say; but I think that basements were not unusual in Denver.
    - o11c 2y ago
      3/6 of the houses I spent a lot of time in as a kid had finished basements. Anecdotally, finished basements are practically required if there is any sort of hill, which fairly common in the west, whereas they're likely to be absent for houses built on the floodplain.
- thefourthchime 2y ago
  We live in a wildly different world now. Cars, shopping centers, everything is bigger. Is that bad? Depends on your viewpoint. As far as I can tell, people are buying what they like so the customer is happy. There are side effects we don't like, but I can see attempting to solve that could have its side effects. Eventually, the market works this out. We got sick of sprawl some people moved back to the cities. Houses are too big? Some people live in much smaller homes closer to the city or even tiny homes.
  - hackerlight 2y ago
    The market isn't allowed to work it out because of single family zoning
- deleted 2y ago
  [deleted]
- refurb 2y ago
  4.5 people in a 1200 sq ft house is packed. I'd argue we are simply purchasing larger homes because that's what people want?
  - pas 2y ago
    that's 111 m² usable space right? and 4.5 people .. meaning parents and 3 kids, well, yeah, that's not super big, but everyone can have their own room (let's say 10+ m² so that's half of the house, and you still have around 50 m² for a living/dining room with kitchen, bathrooms, etc.) it sounds lovely to my European ears :)
- BaculumMeumEst 2y ago
  We don’t live in the 1950’s anymore. When you and your spouse are working from home and have 2+ teenagers 1200 ain’t gonna cut it. Insisting on horrible conditions to raise a family in the modern world is not going to encourage people to have children.
  - bojan 2y ago
    Whatever we are doing now is also not encouraging people to have children. I'm sure many young people would rather choose a 1200 sqft home than no home at all, which is currently the case. Your example of two teenagers is only relevant for 6 years of a family's lifetime. Why should we optimise for those 6 years?
    - BaculumMeumEst 2y ago
      My spouse and I chose to have kids because we could provide for them and house them in nice conditions. I would support making that a reality for more people. There are new suburbs that are slowly coming online where I live, just a little further out than what's currently available, and more of that would be great. And we don't need to be "optimizing" like you're talking about. "Well it's only 6 years of our life, not a big deal for everyone to suffer that long!" Good lord. Just build the houses people want. And clearly some of them want the SQFT - we can meet that demand.
      - bojan 2y ago
        How is living in a 1200 sqft "suffering"? My spouse and I also went for the kids when we were financially stable, and now we live in a 1500 sqft home, and I don't see why would we need a bigger one. We both work from home, the kids have their own rooms, we even have a tiny guest room. What would I do with a 2400 sqft one? Cleaning and maintaining thus one is already a lot of work. In a situation where there is a housing crisis all over the West, building bigger houses, except for a niche market that does exist, just doesn't make sense.
        BaculumMeumEst 2y ago
- mindslight 2y ago
  IMO the tiny 1950's boxes were the start of the problem. "Everybody gets a house", yet it made for an extreme pressure for kids to gtfo as soon as possible rather than living in the bedroom across the hall from your parents (assuming the parents even allow that). My grandparents had a bona fide two family house, two stories with the common "balloon" construction from the (earlier) period. Looking at how its use changed through the years, it allowed for great flexibility. Lots of bedrooms for kids, somewhat private space as they got into their teenage+ years. Then after most moved out and settled down on their own, one stayed in the upstairs apartment with their husband and own kid, and helped out grandma while grandma helped watch the next generation. Then when grandma passed, the house passed to a different brother, who lived in one apartment and rented out the second. Now modern humongous homes are trying to recreate some of that flexibility, but not doing a great job at it. They're still focused on a singular living space where everyone has to interact with each other. This is often due to zoning regulations directly aimed at preventing people from creating full second living spaces that would be possible to rent on the open market - when it's exactly that independence that allows scaling how much house you're actually using.
underlipton 2y ago
I don't buy it. One thing that stands out to me: he has a ton of charts, but this crucial bit: >But, since 2008, vacancies have been declining steeply. is missing one. It looks like this statement is based on his estimates. So... original research. I'll leave it to an actual statistician to analyze his methodology, but that statement doesn't jive with my experience. I continue to suspect that the "housing shortage" (similar to the "labor shortage") is due to a mismatch between the value that industry expects and what are actually the rates necessary to support the population. Powerful institutions representing wealthy individuals and groups, and large swathes of people, like the status quo; it is, in fact, fundamental to their lifestyle, their finances, the overall economy, and they will (and have) done everything they can to keep prices and the perception of scarcity high. The situation doesn't seem rational from an inventory/demand standpoint because it isn't; there are enough house, and they should be worth less and more affordable. But we won't return to reality until the privileging of incumbents ends.
- crooked-v 2y ago
  The "housing shortage" is due to a shortage of housing. This is entirely self-inflicted by various cities that have illegalized all the easy ways of increasing density (see San Francisco for the reductio ad absurdum case), at the prompting of deeply NIMBY voters who oppose anything that will increase construction regardless of claimed political beliefs.
  - giantg2 2y ago
    There are housing shortages in localities due mostly to distribution issues. Nationally, the number of housing units exceeds the number of households (families). In theory that market should correct this by causing places (San Francisco, in your example) to be less attractive and people will choose other places to work and live.
    - zbrozek 2y ago
      You may have noticed a broad swell in house prices across the nation as the pandemic freed folks to work remotely. 10% vacancy is generally considered ok. 5% is what New York state defines as an emergency. Even Buffalo is at 4.9%. The shortage is real.
tasuki 2y ago
> and adults generally live on their own or with a spouse This has not been historically true.
tompccs 2y ago
All other things being equal, an expansion of housing stock which tracked population growth would keep prices steady. The big shift is immigration expanding the pool of working-age people, and longer lifespans increasing the time it takes for family homes to be released back onto the market. People having fewer kids now self-evidently does not affect housing demand (except perhaps to reduce square footage needed per working person)
throwaway22032 2y ago
It's always struck me that housing regulation (well, a lot of regulation really) is written by rich people for rich people. When I moved out of home I'd have been perfectly willing to live in a minimally insulated log cabin, shipping container, etc of sorts with basic running water and wiring that consisted of me running conduit up the walls. I could then upgrade it slowly over time with insulation, stud walls, etc etc time permitting. There's tons of land in the UK that'd be cheap enough to do this. You just can't, though. It has to be done "to code" and with planning permission and a billion other legal things, which basically means forcing everyone into a level of luxury/"modernity" that most actually can't afford. So you end up with basically nonsense like van life, people sleeping in their cars, homelessness etc, because as soon as you build a permanent structure it becomes a huge nonsense.
- philipwhiuk 2y ago
  No, it's written in blood to avoid stuff like the Great Fire of London or epidemics.
  - throwaway22032 2y ago
    Super dense urban situations are not what we are talking about here.
scotty79 2y ago
The cause of the problem is that real estate is a good investment asset. The way to solve the problem is making it a bad investment asset. The best way to do it is to tax real estate progressively. The more you own, the higher percentage of its value you must pay every year. That taxation scheme would make investors drop millions of houses on the market like a hot potato. Prices would tank. This might cause issues with real estate as mortgage collateral. So that needs to be reformed first. Bank would need to be forced by law to accept swapping collateral for another of the same value. Regardless of the current price of the collateral and its replacement. They should also be forced to consider mortgage fully paid once they decide to end the loan and take posession of the collateral. Also no bailouts. Banks are companies. Superpower of companies is that they can die. Let them.
- pas 2y ago
  that's the effect, the cause is that supply did not keep up, and that's caused by all kinds of restrictions and disincentives against high-density and corresponding cities (this stretched out populations, increased overall costs) just as white flight completely turned cities inside out (negating a lot of their economic benefits) the resistance to even gradual "citification" of SFH suburbs further pushed costs up
  - scotty79 2y ago
    It's impossible for the supply to keep up for the demand for investment vessel. China has already built 3 times the number of the apartments that are needed to house the entire population and the demand still outpaces the supply.
    - pas 2y ago
      nah, Chinese real estate bubble bursted, because demand collapsed (despite the prices kept low due to municipalities financing a large part of their budget through land sales, and banks were incentivized to issue a lot of mortgages, and that's how Credit Suisse run into a wall)

78 points by jseliger 2y ago

This discussions on house size and housing shortage in a country so big is indicative of a bad labour market and declining quality of life. The economy is in shambles if homes can’t be built for different income groups. The villain here is the govt that eats up the taxes and imposes more and doesn’t provide basic quality of life. Wealth redistribution is not the solution. Wealth management is the answer. America fails miserably. Basically..if a country as large as America is wanting dense housing and smaller homes, it means it’s becoming poorer. For the rest of world..who are resource constrained or resource poor or economically weak…America is laughing stock. It’s like the world’s richest person has a poverty fetish to fit in. The only true wealth in this world is land. And the govt has made if so none can truly own it. And there you have it. The gaslighting is real. Land owning farmers are the richest people in the world. By offering them subsidies, they have become debtors. Land rich and cash poor. The ultimate goal is land grab by institutional investors until very few elite will own all the land…and its resources.

DoreenMichele 2y ago

In the 1950s, average size of new homes was about 1200 square feet. In 2000, it was more than 2400 square feet and held one less person (iirc: 4.5 VS 3.5 people). We are building 1950s suburban homes on steroids in a post-baby-boom world where average household size has shrunk. There are a lot of problems with this.

zbrozek 2y ago
You build the biggest thing you can within a parcel because there is plenty of demand at the top of the market. Want more, smaller homes? Reduce or eliminate minimum lot sizes, setbacks, constraints on number of units, and process required towards entitlement. What is legal is what gets built. Not enough is legal, and not enough is built as a result.
- swatcoder 2y ago
  > You build the biggest thing you can within a parcel because there is plenty of demand at the top of the market. I know many people who have built many homes and I don't know a single one who thought that way or built a house that reflects it. While impacted by practical needs to a degree, preferred home size is just a fashion that changes over time and amounts to personal taste. The 3500sf McMansion of yesterday becomes the "who would want to maintain and heat all that?!" of tomorrow, the cramped matchbox of yesterday becomes the Eco Friendly Tiny Home of tomorrow, etc People build for the intersection of they want to budget and either: what they want to live in, or what their near-term anticipated buyer is assumed to want in light of current trends.
  - vkou 2y ago
    People building their own homes are outliers. Most homes are built by cookie-cutter block developments, and they make the most money by: 1. Minimizing the size of their lots. 2. Maximizing the size of the homes on the lots. They subdivide as much as they are allowed to, and build as big as they are allowed to. If the houses in your city are too big, it's because the smallest allowed lot size is. If we ever caught up with the housing shortage, and there was a glut of housing on the market, maybe developers would start to build smaller, but we aren't there, and we won't be there for the next ~30 years.
    - swatcoder 2y ago
      Again: I know builders. The size of the home is not a structural rule of the building industry, and is not universal or permanent. Just like any business, it's something builders decide based on who their market is and what they think they'll buy. The described strategy might be what you're seeing in your area and might be the only thing that makes sense to your own tastes, but there are plenty of cities and counties where the pressing demand from buyers is for other things. In trend-leading communities, demand has been growing for years for denser housing with immediate access to retail and commerce; for efficient homes with low utility costs or green considerations; for small houses, condos, and townhouses that are well-appointed but accessibly priced and low-maintenance, etc and this is what builders have been building when they've been able to get cleared to build at all.
willcipriano 2y ago
Finished basements. The house in 1950 had a unfinished basement and was listed at 1200 sq ft. They finished the basement and later sold it as 2400. The difference is a couple pallets of drywall.
- thatfrenchguy 2y ago
  No basements in western states :)
  - makeitshine 2y ago
    I've lived in Oregon, Washington, Nevada and Colorado and I've seen and lived in plenty of places with basements.
    - lotsofpulp 2y ago
      On flat land, basements are a function of home (and land) price. In places where the frost line is not very deep, a basement is a luxury. One of the most expensive parts of the house is laying the foundation, and not building a basement is far cheaper than building a basement. If the frost line is lower, then a basement is very little extra cost since you are digging deeper and laying more concrete anyway. If you are building on a hill, then making a 3 story house is also very little extra cost.
  - cafard 2y ago
    My family lived from 1969 through 2006 in a house in Colorado with a basement. My stepmother--who grew up in a region with cooler summers--ight have perished of heat exhaustion but for the basement. What anyone in particular had outside our neighborhood, I can't say; but I think that basements were not unusual in Denver.
  - o11c 2y ago
    3/6 of the houses I spent a lot of time in as a kid had finished basements. Anecdotally, finished basements are practically required if there is any sort of hill, which fairly common in the west, whereas they're likely to be absent for houses built on the floodplain.
thefourthchime 2y ago
We live in a wildly different world now. Cars, shopping centers, everything is bigger. Is that bad? Depends on your viewpoint. As far as I can tell, people are buying what they like so the customer is happy. There are side effects we don't like, but I can see attempting to solve that could have its side effects. Eventually, the market works this out. We got sick of sprawl some people moved back to the cities. Houses are too big? Some people live in much smaller homes closer to the city or even tiny homes.
- hackerlight 2y ago
  The market isn't allowed to work it out because of single family zoning
deleted 2y ago
[deleted]
refurb 2y ago
4.5 people in a 1200 sq ft house is packed. I'd argue we are simply purchasing larger homes because that's what people want?
- pas 2y ago
  that's 111 m² usable space right? and 4.5 people .. meaning parents and 3 kids, well, yeah, that's not super big, but everyone can have their own room (let's say 10+ m² so that's half of the house, and you still have around 50 m² for a living/dining room with kitchen, bathrooms, etc.) it sounds lovely to my European ears :)
BaculumMeumEst 2y ago
We don’t live in the 1950’s anymore. When you and your spouse are working from home and have 2+ teenagers 1200 ain’t gonna cut it. Insisting on horrible conditions to raise a family in the modern world is not going to encourage people to have children.
- bojan 2y ago
  Whatever we are doing now is also not encouraging people to have children. I'm sure many young people would rather choose a 1200 sqft home than no home at all, which is currently the case. Your example of two teenagers is only relevant for 6 years of a family's lifetime. Why should we optimise for those 6 years?
  - BaculumMeumEst 2y ago
    My spouse and I chose to have kids because we could provide for them and house them in nice conditions. I would support making that a reality for more people. There are new suburbs that are slowly coming online where I live, just a little further out than what's currently available, and more of that would be great. And we don't need to be "optimizing" like you're talking about. "Well it's only 6 years of our life, not a big deal for everyone to suffer that long!" Good lord. Just build the houses people want. And clearly some of them want the SQFT - we can meet that demand.
    - bojan 2y ago
      How is living in a 1200 sqft "suffering"? My spouse and I also went for the kids when we were financially stable, and now we live in a 1500 sqft home, and I don't see why would we need a bigger one. We both work from home, the kids have their own rooms, we even have a tiny guest room. What would I do with a 2400 sqft one? Cleaning and maintaining thus one is already a lot of work. In a situation where there is a housing crisis all over the West, building bigger houses, except for a niche market that does exist, just doesn't make sense.
      - BaculumMeumEst 2y ago
mindslight 2y ago
IMO the tiny 1950's boxes were the start of the problem. "Everybody gets a house", yet it made for an extreme pressure for kids to gtfo as soon as possible rather than living in the bedroom across the hall from your parents (assuming the parents even allow that). My grandparents had a bona fide two family house, two stories with the common "balloon" construction from the (earlier) period. Looking at how its use changed through the years, it allowed for great flexibility. Lots of bedrooms for kids, somewhat private space as they got into their teenage+ years. Then after most moved out and settled down on their own, one stayed in the upstairs apartment with their husband and own kid, and helped out grandma while grandma helped watch the next generation. Then when grandma passed, the house passed to a different brother, who lived in one apartment and rented out the second. Now modern humongous homes are trying to recreate some of that flexibility, but not doing a great job at it. They're still focused on a singular living space where everyone has to interact with each other. This is often due to zoning regulations directly aimed at preventing people from creating full second living spaces that would be possible to rent on the open market - when it's exactly that independence that allows scaling how much house you're actually using.

underlipton 2y ago

I don't buy it. One thing that stands out to me: he has a ton of charts, but this crucial bit: >But, since 2008, vacancies have been declining steeply. is missing one. It looks like this statement is based on his estimates. So... original research. I'll leave it to an actual statistician to analyze his methodology, but that statement doesn't jive with my experience. I continue to suspect that the "housing shortage" (similar to the "labor shortage") is due to a mismatch between the value that industry expects and what are actually the rates necessary to support the population. Powerful institutions representing wealthy individuals and groups, and large swathes of people, like the status quo; it is, in fact, fundamental to their lifestyle, their finances, the overall economy, and they will (and have) done everything they can to keep prices and the perception of scarcity high. The situation doesn't seem rational from an inventory/demand standpoint because it isn't; there are enough house, and they should be worth less and more affordable. But we won't return to reality until the privileging of incumbents ends.

crooked-v 2y ago
The "housing shortage" is due to a shortage of housing. This is entirely self-inflicted by various cities that have illegalized all the easy ways of increasing density (see San Francisco for the reductio ad absurdum case), at the prompting of deeply NIMBY voters who oppose anything that will increase construction regardless of claimed political beliefs.
- giantg2 2y ago
  There are housing shortages in localities due mostly to distribution issues. Nationally, the number of housing units exceeds the number of households (families). In theory that market should correct this by causing places (San Francisco, in your example) to be less attractive and people will choose other places to work and live.
  - zbrozek 2y ago
    You may have noticed a broad swell in house prices across the nation as the pandemic freed folks to work remotely. 10% vacancy is generally considered ok. 5% is what New York state defines as an emergency. Even Buffalo is at 4.9%. The shortage is real.

tasuki 2y ago

> and adults generally live on their own or with a spouse This has not been historically true.

tompccs 2y ago

All other things being equal, an expansion of housing stock which tracked population growth would keep prices steady. The big shift is immigration expanding the pool of working-age people, and longer lifespans increasing the time it takes for family homes to be released back onto the market. People having fewer kids now self-evidently does not affect housing demand (except perhaps to reduce square footage needed per working person)

throwaway22032 2y ago

It's always struck me that housing regulation (well, a lot of regulation really) is written by rich people for rich people. When I moved out of home I'd have been perfectly willing to live in a minimally insulated log cabin, shipping container, etc of sorts with basic running water and wiring that consisted of me running conduit up the walls. I could then upgrade it slowly over time with insulation, stud walls, etc etc time permitting. There's tons of land in the UK that'd be cheap enough to do this. You just can't, though. It has to be done "to code" and with planning permission and a billion other legal things, which basically means forcing everyone into a level of luxury/"modernity" that most actually can't afford. So you end up with basically nonsense like van life, people sleeping in their cars, homelessness etc, because as soon as you build a permanent structure it becomes a huge nonsense.

philipwhiuk 2y ago
No, it's written in blood to avoid stuff like the Great Fire of London or epidemics.
- throwaway22032 2y ago
  Super dense urban situations are not what we are talking about here.

scotty79 2y ago

The cause of the problem is that real estate is a good investment asset. The way to solve the problem is making it a bad investment asset. The best way to do it is to tax real estate progressively. The more you own, the higher percentage of its value you must pay every year. That taxation scheme would make investors drop millions of houses on the market like a hot potato. Prices would tank. This might cause issues with real estate as mortgage collateral. So that needs to be reformed first. Bank would need to be forced by law to accept swapping collateral for another of the same value. Regardless of the current price of the collateral and its replacement. They should also be forced to consider mortgage fully paid once they decide to end the loan and take posession of the collateral. Also no bailouts. Banks are companies. Superpower of companies is that they can die. Let them.

pas 2y ago
that's the effect, the cause is that supply did not keep up, and that's caused by all kinds of restrictions and disincentives against high-density and corresponding cities (this stretched out populations, increased overall costs) just as white flight completely turned cities inside out (negating a lot of their economic benefits) the resistance to even gradual "citification" of SFH suburbs further pushed costs up
- scotty79 2y ago
  It's impossible for the supply to keep up for the demand for investment vessel. China has already built 3 times the number of the apartments that are needed to house the entire population and the demand still outpaces the supply.
  - pas 2y ago
    nah, Chinese real estate bubble bursted, because demand collapsed (despite the prices kept low due to municipalities financing a large part of their budget through land sales, and banks were incentivized to issue a lot of mortgages, and that's how Credit Suisse run into a wall)