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This is an excellent post for folks just getting into the homeownership racket: what is pitched as a necessity for wealth creation and an “easy” transaction wit

This is an excellent post for folks just getting into the homeownership racket: what is pitched as a necessity for wealth creation and an “easy” transaction with nothing but upsides is - unsurprisingly - a nuanced and complicated financial transaction that has no guarantee of upside. A few things I’d note to add more data points to the pile: * Property tax caps like the OP discusses are likely to go away in the near future. Having been artificially capped for so long with so much uncaptured asset appreciation, communities are having to face either serious cuts in services or to seek permission in raising property taxes. If you’re buying a “forever home”, ask yourself if you could still afford it with 2x or 3x the property tax bill; if not, you might not be ready to weather the disruptions ahead * Rent has skyrocketed alongside home prices, making both untenable (local housing jumped 50% in home prices during COVID, while rent has appreciated about the same over the past ten years; wages have not kept pace with either). Some states have tried forcing higher density housing near mass transit, but those have been blocked or lawyered around; now tenants are pushing to rent caps, terrifying landlords. The point is that pricing in the near future is going to be incredibly volatile as asset prices and rents adjust to meet what workers can afford instead of what financial models spit out, and that’s going to impact your own home prices accordingly * The primary benefit of home ownership going forward isn’t likely to be asset appreciation so much as stability. For those of us who want to put down roots, owning our homes is critical; for folks happy to move around and explore, renting is far preferable. I would strongly caution against the old adage of “buy if you’re living there for 4+ years”, as there’s no guarantee you’ll come out ahead anymore and may be better off renting * Most “affordable” housing stock will require repairs anywhere from 20 to 50% of its purchase price, especially in older regions of the country. Do not waive inspections when buying a home or you’re likely to miss a five or six-figure repair - like an oil tank that’s leaked into the foundation, for instance.

xnx 5mo ago
The ponzi scheme of property-values-always-go-up only holds when population is increasing. In the US, immigration and fertility changes are bringing population growth to a halt. Good news: We may yet enter an era of housing abundance!
- stego-tech 5mo ago
  Yes and no, at least in the USA. Thanks to companies rug-pulling with RTO, the populace won’t leave cities again this generation regardless of how cheap other places might be; we have to stay near the place of employment, and those are predominantly in cities. Frustratingly, cities have a housing crisis in that there’s not enough stock to meet demand - period. We can carve up the rationale in a variety of ways (too expensive, too many vacant units held hostage for investing, NIMBYs, red tape, etc), but the blunt truth is that companies and the government have made it abundantly clear that the only chance at a successful career is in a major metro, and thus more folks will move to them seeking their lottery ticket to the middle class. So what ends up happening is rural areas will continue to thin out due to a lack of local work to support existing workers as well as a dearth of remote work to allow city salaries to come back to Small Town USA and prop up businesses through outsized taxes and spending. This will cause a contraction, forcing more locals to cities, deflating rural property values further while cities keep struggling with a lack of supply. The silver bullet - the only silver bullet for any crisis we’re currently facing - was widespread remote work allowing humans to relocate based on preference rather than career need, and thus alleviate urban sprawl and revitalize smaller communities. Capital and Government have killed that dead, and there’s no way to bring it back.

xnx 5mo ago

The ponzi scheme of property-values-always-go-up only holds when population is increasing. In the US, immigration and fertility changes are bringing population growth to a halt. Good news: We may yet enter an era of housing abundance!

stego-tech 5mo ago
Yes and no, at least in the USA. Thanks to companies rug-pulling with RTO, the populace won’t leave cities again this generation regardless of how cheap other places might be; we have to stay near the place of employment, and those are predominantly in cities. Frustratingly, cities have a housing crisis in that there’s not enough stock to meet demand - period. We can carve up the rationale in a variety of ways (too expensive, too many vacant units held hostage for investing, NIMBYs, red tape, etc), but the blunt truth is that companies and the government have made it abundantly clear that the only chance at a successful career is in a major metro, and thus more folks will move to them seeking their lottery ticket to the middle class. So what ends up happening is rural areas will continue to thin out due to a lack of local work to support existing workers as well as a dearth of remote work to allow city salaries to come back to Small Town USA and prop up businesses through outsized taxes and spending. This will cause a contraction, forcing more locals to cities, deflating rural property values further while cities keep struggling with a lack of supply. The silver bullet - the only silver bullet for any crisis we’re currently facing - was widespread remote work allowing humans to relocate based on preference rather than career need, and thus alleviate urban sprawl and revitalize smaller communities. Capital and Government have killed that dead, and there’s no way to bring it back.