5 ms·

I really thought the major "rust belt" cities were going to blow up after the big COVID WFH push. Why spend 2-10x as much to live in one of four coastal metros

I really thought the major "rust belt" cities were going to blow up after the big COVID WFH push. Why spend 2-10x as much to live in one of four coastal metros when you could get the same pay while living somewhere much cheaper. The biggest issue with these cities in the last 50 years has been a lack of high paying jobs and WFH tech jobs essentially negate that issue. There are a ton of American cities that have fallen from their former glory but are full of cheap housing, interesting things, and lots of history. Shame it doesn't seem like that has panned out much.

lotsofpulp 2y ago
It seems evident that people, by and large, don’t like freezing temperatures.
- francisofascii 2y ago
  NYC, Boston, and Toronto are still bustling. The uncertainty of work from home with RTO mandates popping up at a moments notice keep people from making the jump.
  - lotsofpulp 2y ago
    It is better to use nationwide migration statistics over large periods of time rather than selectively choosing a few metros as a data point. As I understand, it might also simply be biology that older bodies like higher temperatures because it results in less pain.
- lesuorac 2y ago
  That and you don't get the same pay by living somewhere cheaper.
  - pc86 2y ago
    Maybe. Lots of companies don't localize their pay, or localize it based on country. Even those that do if you're comparing, for example, Pittsburgh and NYC/SF, you're unlikely to come out ahead in NYC/SF especially after you factor in state income tax.
- nancyminusone 2y ago
  I'll take the cold over water shortages, wildfires, earthquakes, hurricanes, or excessive heat any day. I wonder if we'll see more people coming to the rust belt as the climate gets worse.
  - pc86 2y ago
    "Just move north" is a common refrain from people who don't understand what climate change means.
    - nancyminusone 2y ago
      Could you expand on this point? Are climate refugees not expected, at least in the short term?
      - pc86 2y ago
        It's a byproduct of the naïve belief that climate change means it gets hotter (and little/nothing else), to which "just move north" is a logical conclusion. The truth is closer to climate change means more extreme weather happens everywhere, and things get hotter up until -- and here's where my knowledge of science may be much less up-to-date -- a critical mass of ice at the poles melts, and which point the temperature plummets. By definition a lot of areas will be hit hard and some areas will be hit less hard but it's not going to be along a north-south axis.
        Qwertious 2y ago
        IMO it should be called "climate destabilisation".
- AngryData 2y ago
  I see a lot more people complain about the potential of freezing temperatures than they really are bothered to do anything about it. Ive seen this same thing from many people, but using my mother as an example, she has complained about ice and snow for the past 40 years ive been around, always claimed she wanted to move farther south to not deal with it, but she never has, and has even in the past few years thought about moving even farther North because unless you enjoy winter sports or work outside, you spend most of the winter time indoors where it doesn't actually matter that much.
1123581321 2y ago
It is happening, but it takes time as those cities can only grow as fast as palatable housing stock comes online. The largest percentage growths in home values, with short days on market, have have been in Rockford, Akron, Fort Wayne, Lansing, etc. There is new construction in all of these markets, but much of it is from rehabbing old manufacturing buildings, another limiter, or from a mix of public and private money that city government can only consider so quickly. Economic growth is mostly in services to support the remote jobs. Building new primary businesses (sell out of local market) might never happen. So they look just as sleepy as ever even though there’s a lot of activity in housing and new transplants.
ndileas 2y ago
I live in Rochester NY, grew up in Buffalo. Housing markets here were nuts the last couple years, probably due to this effect (although laughable compared to SF I'm sure) and pent up demand. I'm not sure I really want it to "blow up" any more, although I'm not much of a big city guy - I like going to the same diner every Saturday and reading at home. Life is pretty good.
- francisofascii 2y ago
  Yep, I know a guy who moved to Rochester metro from the NYC metro post COVID. I was kinda shocked to see the high prices of housing there.
yardie 2y ago
The sun belt took wind out of their sails. And even they are starting to see softening demand. Miami just cancelled an A-class commercial high rise due to weak demand. In Austin, rents are tanking. It’s very hard to revive a town or city when the tax base is way down. I thought Detroit was going to succeed but they simply have too much ground to manage with their revenue. And there isn’t a way to shrink a shrinking city.
- nradov 2y ago
  Insurance premium increases have killed a lot of the housing cost advantage that Florida used to have.
  - boringg 2y ago
    And Canadians have been shedding property in droves due to high cost (USD-CAD), your comment on insurance and general antagonistic policies at a Federal level.
  - arrowsmith 2y ago
    Why are the premiums going up? Hurricanes?
    - kccqzy 2y ago
      Many large insurance companies leaving Florida. Their last-resort insurance, Citizens Property Insurance Corp, is perpetually one bad hurricane away from insolvency. Well technically they cannot be insolvent but they are allowed a premium surcharge on everyone, including those who do not have their insurance.
    - jetrink 2y ago
      Increasing hurricane risk yes, but also a dysfunctional insurance market. There's a business model where roofing companies will approach homeowners telling them they have hurricane damage and are eligible to receive a free roof. The hurricane might passed through years before, but any damage that was overlooked is still the responsibility of the insurance company. The homeowners are surprised to learn that their roof has damage, since they haven't noticed anything wrong (and there is in fact no damage), but free is free, so they sign the contract. The roofing company files a claim, the insurance company denies it, the roofing company sues, and since a lawsuit costs more than a roof, the insurance company backs down. Then after this has happened repeatedly, the insurance company raises their rates or leaves the state.
gcanyon 2y ago
Weather is a thing, along with infrastructure.
no_wizard 2y ago
Most companies will cut your pay based on where you live, though. You aren’t usually paid the same. That isn’t the norm. Secondly and probably more important is there is zero guarantees that WFH will be supported by the work places they can support it will, we have seen a huge RTO surge. I’d hate to be in one of these cities and get that call. If WFH opportunities had legal protections and incentives it’d be a different story I imagine
- pc86 2y ago
  Whether or not locality-based pay is the norm is an open question. Every place I've ever worked had a budget for the role and that was that, but most places I've worked only hire folks within the US who don't need visa sponsorship so that's already a smaller group than "anyone who can type JavaScript into a computer." Would you rather live and rent in NYC and work from home for 4 years until asked to commute again, or live and rent in Detroit or Pittsburgh or Indianapolis and take that $50-400k you saved and move? Moving is easy and if you need to move to support an RTO mandate, especially if you were hired remote and weren't local you can almost certainly negotiate some relocation assistance. It's not a big deal to move unless you have kids in school which if you went remote during COVID and had a kid basically immediately is still likely not a huge issue. Moving in middle school or high school can be impactful, moving during kindergarten or first grade is a nothingburger.
  - ghaff 2y ago
    Even if there aren't location-based salaries as such, there's a lot of "ROFL, we're not going to match your Facebook offer." I worked for someone who eventually ended up with very few California employees and, I believe, eventually closed their relatively small office there. >Moving is easy I disagree with this. If you have a relatively small number of possessions living by yourself in an apartment, maybe. But, as you say, with a partner and even kids with an established circle of friends—and maybe a house, is definitely not easy.
- dcchambers 2y ago
  Yes, in some cases location-based pay is a thing. But $150K in Detroit feels a hell of a lot richer than $250K in SF.
nilamo 2y ago
That did start to happen, but rent near downtown Detroit is >$2k/month, which pushes out most of the people that want to live there.
tokioyoyo 2y ago
Generally, people like to have fun and will pay premiums to live in cities where stuff happens. Cheap housing and money aren’t the only motivators, otherwise we would have a different landscape.
- BobaFloutist 2y ago
  That said, cheap housing/warehouse space often leads to an explosion of art and music in sufficiently populated cities.
- ghaff 2y ago
  Generally is doing a lot of work there. There are vast suburbs (including Silicon Valley) and exurbs in the US even before you get genuinely rural. I can drive an hour into some large cities where "fun happens" although I have lots of activities around where I live too.
jt2190 2y ago
Housing is cheap because the job market is poor. Should enough remote workers choose to relocate to the same rust-belt city we’d see higher housing prices in that city. The challenge is that rust-belt cities are just not desirable enough for enough remote workers to reverse the decades of decline. Furthermore, there is no reason that remote workers would cluster by geography other than fear of loosing their remote job and having to return to office, so I don’t think remote workers will be able to turn the tide of the rust-belt.
- Qwertious 2y ago
  >Furthermore, there is no reason that remote workers would cluster by geography other than fear Amenities. Some things (and communities) just aren't available elsewhere. And some people just value their local identity too much to move.
  - jt2190 2y ago
    > Amenities Yes, but what amenities do rust-belt cities have exclusively, that other cities can’t compete with? > … [Some] people just value their local identity too much. Sure, but I assume that there just aren’t enough of these types to stop the decline of the rust-belt, otherwise we’d see more resilience of their populations.
schmichael 2y ago
> Why spend 2-10x as much to live in one of four coastal metros I think you answered your own question: it’s not (entirely) an economic decision. Weather, culture, nature, civic amenities. There’s a lot in life that money can’t buy. Sure I could own a McMansion on a palatial plot of prairie, but what if the square footage of my house and acreage of my yard isn’t what’s important to me?
- Yeul 2y ago
  Being surrounded by Christian conservative Trump voters is not how everyone wants to live their life. HN probably consists of a lot of people who are perfectly content spending their entire life looking at a screen perfectly oblivious of what is going on.
Telemakhos 2y ago
There's a major issue in American cities that is unmentionable in polite society: the so-called Curley Effect [0], named after a Boston politician who drove the old Boston Brahmins out of their city by taxing them out of town and pandering to Irish immigrants, making the city as a whole poorer. It turns out that politics is not so straightforward as to reward politicians who improve their cities: instead, a politician can leverage group (ethnic, racial, whatever) differences to reward supporters with largesse designed to render them dependent on the politician, while driving out those who, by nature of their independence, could oppose the politician. In effect, there is a substantial likelihood that American cities decay because politicians consolidate power through the kinds of high taxes and poor services that drive away high earners. WFH workers are very independent: they could move to a city or from it with no regard for the job market. That makes them prime targets for eliminating from a city under the Curley effect. [0] https://scholar.harvard.edu/files/shleifer/files/curley_effect.pdf https://scholar.harvard.edu/files/shleifer/files/curley_effe...
agoodusername63 2y ago
I was really hoping for this too. I love WFH and I hope I never have to work in an office again. I was hoping the obvious financial efficiency improvements would have made the concept stick more and enable more mobility in the US unfortunately it looks like we couldn't get over our need for employee control even for types of work that is largely online anyways. I'm still sad that it isn't likely to grow much.
kevin_thibedeau 2y ago
Rochester NY is seeing an influx of people driven by the high CoL elsewhere. The region's housing stock has been severely undervalued for decades. Now migrants and REITs are snapping it up for comparatively cheap causing locals to have a lot of anxiety over the rapid run up in housing costs. The region ranks high on safety from disasters and resource shortages so, in the long term, it and the entire great lakes will see more migration once the "glamour" of scurrying between air conditioned spaces wears off in the places due to become desertified or flooded.

lotsofpulp 2y ago

It seems evident that people, by and large, don’t like freezing temperatures.

francisofascii 2y ago
NYC, Boston, and Toronto are still bustling. The uncertainty of work from home with RTO mandates popping up at a moments notice keep people from making the jump.
- lotsofpulp 2y ago
  It is better to use nationwide migration statistics over large periods of time rather than selectively choosing a few metros as a data point. As I understand, it might also simply be biology that older bodies like higher temperatures because it results in less pain.
lesuorac 2y ago
That and you don't get the same pay by living somewhere cheaper.
- pc86 2y ago
  Maybe. Lots of companies don't localize their pay, or localize it based on country. Even those that do if you're comparing, for example, Pittsburgh and NYC/SF, you're unlikely to come out ahead in NYC/SF especially after you factor in state income tax.
nancyminusone 2y ago
I'll take the cold over water shortages, wildfires, earthquakes, hurricanes, or excessive heat any day. I wonder if we'll see more people coming to the rust belt as the climate gets worse.
- pc86 2y ago
  "Just move north" is a common refrain from people who don't understand what climate change means.
  - nancyminusone 2y ago
    Could you expand on this point? Are climate refugees not expected, at least in the short term?
    - pc86 2y ago
      It's a byproduct of the naïve belief that climate change means it gets hotter (and little/nothing else), to which "just move north" is a logical conclusion. The truth is closer to climate change means more extreme weather happens everywhere, and things get hotter up until -- and here's where my knowledge of science may be much less up-to-date -- a critical mass of ice at the poles melts, and which point the temperature plummets. By definition a lot of areas will be hit hard and some areas will be hit less hard but it's not going to be along a north-south axis.
      - Qwertious 2y ago
        IMO it should be called "climate destabilisation".
AngryData 2y ago
I see a lot more people complain about the potential of freezing temperatures than they really are bothered to do anything about it. Ive seen this same thing from many people, but using my mother as an example, she has complained about ice and snow for the past 40 years ive been around, always claimed she wanted to move farther south to not deal with it, but she never has, and has even in the past few years thought about moving even farther North because unless you enjoy winter sports or work outside, you spend most of the winter time indoors where it doesn't actually matter that much.

1123581321 2y ago

It is happening, but it takes time as those cities can only grow as fast as palatable housing stock comes online. The largest percentage growths in home values, with short days on market, have have been in Rockford, Akron, Fort Wayne, Lansing, etc. There is new construction in all of these markets, but much of it is from rehabbing old manufacturing buildings, another limiter, or from a mix of public and private money that city government can only consider so quickly. Economic growth is mostly in services to support the remote jobs. Building new primary businesses (sell out of local market) might never happen. So they look just as sleepy as ever even though there’s a lot of activity in housing and new transplants.

ndileas 2y ago

I live in Rochester NY, grew up in Buffalo. Housing markets here were nuts the last couple years, probably due to this effect (although laughable compared to SF I'm sure) and pent up demand. I'm not sure I really want it to "blow up" any more, although I'm not much of a big city guy - I like going to the same diner every Saturday and reading at home. Life is pretty good.

francisofascii 2y ago
Yep, I know a guy who moved to Rochester metro from the NYC metro post COVID. I was kinda shocked to see the high prices of housing there.

yardie 2y ago

The sun belt took wind out of their sails. And even they are starting to see softening demand. Miami just cancelled an A-class commercial high rise due to weak demand. In Austin, rents are tanking. It’s very hard to revive a town or city when the tax base is way down. I thought Detroit was going to succeed but they simply have too much ground to manage with their revenue. And there isn’t a way to shrink a shrinking city.

nradov 2y ago
Insurance premium increases have killed a lot of the housing cost advantage that Florida used to have.
- boringg 2y ago
  And Canadians have been shedding property in droves due to high cost (USD-CAD), your comment on insurance and general antagonistic policies at a Federal level.
- arrowsmith 2y ago
  Why are the premiums going up? Hurricanes?
  - kccqzy 2y ago
    Many large insurance companies leaving Florida. Their last-resort insurance, Citizens Property Insurance Corp, is perpetually one bad hurricane away from insolvency. Well technically they cannot be insolvent but they are allowed a premium surcharge on everyone, including those who do not have their insurance.
  - jetrink 2y ago
    Increasing hurricane risk yes, but also a dysfunctional insurance market. There's a business model where roofing companies will approach homeowners telling them they have hurricane damage and are eligible to receive a free roof. The hurricane might passed through years before, but any damage that was overlooked is still the responsibility of the insurance company. The homeowners are surprised to learn that their roof has damage, since they haven't noticed anything wrong (and there is in fact no damage), but free is free, so they sign the contract. The roofing company files a claim, the insurance company denies it, the roofing company sues, and since a lawsuit costs more than a roof, the insurance company backs down. Then after this has happened repeatedly, the insurance company raises their rates or leaves the state.

gcanyon 2y ago

Weather is a thing, along with infrastructure.

no_wizard 2y ago

Most companies will cut your pay based on where you live, though. You aren’t usually paid the same. That isn’t the norm. Secondly and probably more important is there is zero guarantees that WFH will be supported by the work places they can support it will, we have seen a huge RTO surge. I’d hate to be in one of these cities and get that call. If WFH opportunities had legal protections and incentives it’d be a different story I imagine

pc86 2y ago
Whether or not locality-based pay is the norm is an open question. Every place I've ever worked had a budget for the role and that was that, but most places I've worked only hire folks within the US who don't need visa sponsorship so that's already a smaller group than "anyone who can type JavaScript into a computer." Would you rather live and rent in NYC and work from home for 4 years until asked to commute again, or live and rent in Detroit or Pittsburgh or Indianapolis and take that $50-400k you saved and move? Moving is easy and if you need to move to support an RTO mandate, especially if you were hired remote and weren't local you can almost certainly negotiate some relocation assistance. It's not a big deal to move unless you have kids in school which if you went remote during COVID and had a kid basically immediately is still likely not a huge issue. Moving in middle school or high school can be impactful, moving during kindergarten or first grade is a nothingburger.
- ghaff 2y ago
  Even if there aren't location-based salaries as such, there's a lot of "ROFL, we're not going to match your Facebook offer." I worked for someone who eventually ended up with very few California employees and, I believe, eventually closed their relatively small office there. >Moving is easy I disagree with this. If you have a relatively small number of possessions living by yourself in an apartment, maybe. But, as you say, with a partner and even kids with an established circle of friends—and maybe a house, is definitely not easy.
dcchambers 2y ago
Yes, in some cases location-based pay is a thing. But $150K in Detroit feels a hell of a lot richer than $250K in SF.

nilamo 2y ago

That did start to happen, but rent near downtown Detroit is >$2k/month, which pushes out most of the people that want to live there.

tokioyoyo 2y ago

Generally, people like to have fun and will pay premiums to live in cities where stuff happens. Cheap housing and money aren’t the only motivators, otherwise we would have a different landscape.

BobaFloutist 2y ago
That said, cheap housing/warehouse space often leads to an explosion of art and music in sufficiently populated cities.
ghaff 2y ago
Generally is doing a lot of work there. There are vast suburbs (including Silicon Valley) and exurbs in the US even before you get genuinely rural. I can drive an hour into some large cities where "fun happens" although I have lots of activities around where I live too.

jt2190 2y ago

Housing is cheap because the job market is poor. Should enough remote workers choose to relocate to the same rust-belt city we’d see higher housing prices in that city. The challenge is that rust-belt cities are just not desirable enough for enough remote workers to reverse the decades of decline. Furthermore, there is no reason that remote workers would cluster by geography other than fear of loosing their remote job and having to return to office, so I don’t think remote workers will be able to turn the tide of the rust-belt.

Qwertious 2y ago
>Furthermore, there is no reason that remote workers would cluster by geography other than fear Amenities. Some things (and communities) just aren't available elsewhere. And some people just value their local identity too much to move.
- jt2190 2y ago
  > Amenities Yes, but what amenities do rust-belt cities have exclusively, that other cities can’t compete with? > … [Some] people just value their local identity too much. Sure, but I assume that there just aren’t enough of these types to stop the decline of the rust-belt, otherwise we’d see more resilience of their populations.

schmichael 2y ago

> Why spend 2-10x as much to live in one of four coastal metros I think you answered your own question: it’s not (entirely) an economic decision. Weather, culture, nature, civic amenities. There’s a lot in life that money can’t buy. Sure I could own a McMansion on a palatial plot of prairie, but what if the square footage of my house and acreage of my yard isn’t what’s important to me?

Yeul 2y ago
Being surrounded by Christian conservative Trump voters is not how everyone wants to live their life. HN probably consists of a lot of people who are perfectly content spending their entire life looking at a screen perfectly oblivious of what is going on.

Telemakhos 2y ago

There's a major issue in American cities that is unmentionable in polite society: the so-called Curley Effect [0], named after a Boston politician who drove the old Boston Brahmins out of their city by taxing them out of town and pandering to Irish immigrants, making the city as a whole poorer. It turns out that politics is not so straightforward as to reward politicians who improve their cities: instead, a politician can leverage group (ethnic, racial, whatever) differences to reward supporters with largesse designed to render them dependent on the politician, while driving out those who, by nature of their independence, could oppose the politician. In effect, there is a substantial likelihood that American cities decay because politicians consolidate power through the kinds of high taxes and poor services that drive away high earners. WFH workers are very independent: they could move to a city or from it with no regard for the job market. That makes them prime targets for eliminating from a city under the Curley effect. [0] https://scholar.harvard.edu/files/shleifer/files/curley_effect.pdf https://scholar.harvard.edu/files/shleifer/files/curley_effe...

agoodusername63 2y ago

I was really hoping for this too. I love WFH and I hope I never have to work in an office again. I was hoping the obvious financial efficiency improvements would have made the concept stick more and enable more mobility in the US unfortunately it looks like we couldn't get over our need for employee control even for types of work that is largely online anyways. I'm still sad that it isn't likely to grow much.

kevin_thibedeau 2y ago

Rochester NY is seeing an influx of people driven by the high CoL elsewhere. The region's housing stock has been severely undervalued for decades. Now migrants and REITs are snapping it up for comparatively cheap causing locals to have a lot of anxiety over the rapid run up in housing costs. The region ranks high on safety from disasters and resource shortages so, in the long term, it and the entire great lakes will see more migration once the "glamour" of scurrying between air conditioned spaces wears off in the places due to become desertified or flooded.