74 ms·

Very good read (I read the transcript rather than watch) > 60 percent of the cost of building a home goes to permits Is an incredible indictment of our system

bombcar 2y ago
That seems exceptionally high, and maybe true in some areas, but in others a "total home" permit is a flat fee on the final price, and that flat fee isn't 60%.
- toomuchtodo 2y ago
  I think Galloway missed the mark on new housing construction (he's right wrt supply, but falls short wrt causes, from my quick review of the talk he may have been scoping to Vancouver BC specifically), there is a ton of nuance. It is a combination of permitting, zoning ("NIMBY/YIMBY" here fore brevity), cost of capital, and builders incentivized to deliver supply only so quickly. https://www.housingwire.com/articles/builders-are-pulling-back-on-single-family-home-construction/ https://www.housingwire.com/articles/builders-are-pulling-ba... https://www.morningstar.com/news/marketwatch/20240508284/home-builders-stocks-have-soared-since-we-said-they-were-cheap-these-five-are-expected-to-grow-profits-rapidly-through-2025 https://www.morningstar.com/news/marketwatch/20240508284/hom... https://www.reuters.com/business/us-homebuilder-lennar-beats-q1-profit-estimates-higher-home-deliveries-2024-03-13/ https://www.reuters.com/business/us-homebuilder-lennar-beats... https://www.dallasnews.com/business/real-estate/2024/04/18/tight-supply-of-homes-propels-builder-dr-horton-to-big-sales-profits/ https://www.dallasnews.com/business/real-estate/2024/04/18/t... There's only so much the executive branch can do on its own to fix this. This is a macro systems problem, and will take time and effort to fix. https://www.whitehouse.gov/briefing-room/statements-releases/2022/05/16/president-biden-announces-new-actions-to-ease-the-burden-of-housing-costs/ https://www.whitehouse.gov/briefing-room/statements-releases...
  - bombcar 2y ago
    Part of it is also that trying to solve local problems at the federal level can often just result in more insanity. Around here from empty lot to built house is about 6 months, and that's within an hour of a major airport. However, the builders are taking relatively little risk on each house/development, because if it falls through (unlikely) they're only out one house, and might lose a small amount or just hold the land and wait. When the only developments you can do are multi-million, the risks now rise.

bombcar 2y ago

That seems exceptionally high, and maybe true in some areas, but in others a "total home" permit is a flat fee on the final price, and that flat fee isn't 60%.

toomuchtodo 2y ago
I think Galloway missed the mark on new housing construction (he's right wrt supply, but falls short wrt causes, from my quick review of the talk he may have been scoping to Vancouver BC specifically), there is a ton of nuance. It is a combination of permitting, zoning ("NIMBY/YIMBY" here fore brevity), cost of capital, and builders incentivized to deliver supply only so quickly. https://www.housingwire.com/articles/builders-are-pulling-back-on-single-family-home-construction/ https://www.housingwire.com/articles/builders-are-pulling-ba... https://www.morningstar.com/news/marketwatch/20240508284/home-builders-stocks-have-soared-since-we-said-they-were-cheap-these-five-are-expected-to-grow-profits-rapidly-through-2025 https://www.morningstar.com/news/marketwatch/20240508284/hom... https://www.reuters.com/business/us-homebuilder-lennar-beats-q1-profit-estimates-higher-home-deliveries-2024-03-13/ https://www.reuters.com/business/us-homebuilder-lennar-beats... https://www.dallasnews.com/business/real-estate/2024/04/18/tight-supply-of-homes-propels-builder-dr-horton-to-big-sales-profits/ https://www.dallasnews.com/business/real-estate/2024/04/18/t... There's only so much the executive branch can do on its own to fix this. This is a macro systems problem, and will take time and effort to fix. https://www.whitehouse.gov/briefing-room/statements-releases/2022/05/16/president-biden-announces-new-actions-to-ease-the-burden-of-housing-costs/ https://www.whitehouse.gov/briefing-room/statements-releases...
- bombcar 2y ago
  Part of it is also that trying to solve local problems at the federal level can often just result in more insanity. Around here from empty lot to built house is about 6 months, and that's within an hour of a major airport. However, the builders are taking relatively little risk on each house/development, because if it falls through (unlikely) they're only out one house, and might lose a small amount or just hold the land and wait. When the only developments you can do are multi-million, the risks now rise.