A record 242 US cities now have starter homes that cost $1M
investors.zillowgroup.com
investors.zillowgroup.com
Mortgage payment vs. household income is probably the best way to assess affordability.
Except that effect and cause are counterintuitive.
People bid against each other on houses to the limit of affordability (maximum payments). With somewhat different dynamics for existing mortgages.
So house prices increase if income increases.
And house prices increase if interest rates fall.
And house prices increase if mortgage terms are made longer.
So affordability doesn't act like you think it might, because how people compete really matters.
Housing as an investment is bad policy. If your house appreciates, it doesn't mean that you can sell it and buy another which is cheaper. All livable (and unlivable) houses have appreciated and it will cost at least that much to buy another. It is far more likely your new house will cost a lot more, because you are moving from a less desirable house to a more desirable house and there are always people with more money than you. Making it worse are the global money laundering bidders, who don't care about how much, just as long as they can quickly launder money.
No wealth is being generated (no product is being created), that's why it is - fundamentally - a redistribution
https://us.macmillan.com/books/9780374607647/gerontocracyina...
What kind of life experience would lead to such a conclusion? It's almost like you have no idea what a community is - with one's friends, neighbors, familiar shops, clubs, church etc. Money is not everything in life. Any policy which forces people in their late 60's to uproot and go somewhere else to rebuild their lives is bound to face a very angry backlash. A mindset like yours is why we got prop 13 here in California.
Doubt. They don't define what constitutes a city and seem to be purposely be hiding the data. There's only a count of the cities per state with no mention their names. I followed link after link and couldn't find them and gave up. Texas supposedly has 7 of these $1m+ starter home cities. Austin is the most expensive metropolitan area, and there are plenty of < $600k homes in centrally located areas. Venture out to the suburbs like Pflugerville, Cedar Park or Buda and you'll have plenty of options with $400k to spend. There are only a handful of small pockets around the city where $1m won't buy you a starter home like Zilker and Tarrytown.
> For buyers navigating today's market, Zillow Home Loans' BuyAbility℠ tool provides a personalized, real-time estimate of the home price and monthly payment that fit within their budget. Home listings on Zillow also include a down payment assistance module to help shoppers identify local programs that may be available to them.
> For those who decide renting is the right call, Zillow Rentals® lists options across every price point and property type — including single-family homes, apartments and individual room listings. Renters can also use CreditClimb to report on-time rent payments to the major credit bureaus, building the credit history that will put them in a stronger position when they're ready to buy.
This is just fear driven advertising. BUY NOW OR YOU'LL NEVER OWN A HOME!!
If you wanted to offer a more convincing doubt about the method, I suggest complaining about their treatment of mix shift.
I'm not trying to convince anyone who will agree on a data-driven premise without actually seeing the data. The article states that a record number of cities have $1m+ starter homes, but there's no easily accessible list of those cities. I couldn't find it, where did you see it? I gave up after clicking about 10 different links and only landing on another vague article or advertiser's product.
That's exactly what they're doing and I even put a snippet from the article in my comment. Here it is again
> For buyers navigating today's market, Zillow Home Loans' BuyAbility℠ tool provides a personalized, real-time estimate of the home price and monthly payment that fit within their budget. Home listings on Zillow also include a down payment assistance module to help shoppers identify local programs that may be available to them.
Anyway, my point is that it comes across as deceptive by providing ambiguous information with no easily accessible data to reference and loading the article with as many advertising links as possible.
For example, the City of Sydney LGA is only one of 33 LGAs that make up what is normally known as Sydney.
It varies, but mostly yes. I think they're limiting the definition of a "city" to as small as possible to inflate the prices for a scary headline. Austin is the most expensive metropolitan area in TX. Fire up zillow if you can access it, search for Austin, TX with a $600k limit and it'll automatically put the city boundary on the results. You'll find plenty of listings, over 1900 standalone homes for me as of right now. Including townhomes and condos it's over 2800.
And it's not smartphones that broke our mating rituals, because the change was already happening long before. I'd argue that economic development exposed the dirty truth that people just don't like each other and given the choice between marriage or watching TV undisturbed, they'll choose the latter.
Something that doesn't intuitively click for me is, if the lack of housing is the issue, then why do we have historically low average number of people living in a single house.
https://news.ycombinator.com/item?id=48444543
The GFC housing bust happened at the same time but note that the drop in fertility was most severe for teens so the phone effect predates the shortfall in units built
You mean, there are less teen parents nowadays? That would count as improvement in my books...
[1] https://en.wikipedia.org/wiki/List_of_largest_cities_in_Cali...
[2] https://en.wikipedia.org/wiki/Regent_International_Center
[3] https://zh.wikipedia.org/zh-cn/%E6%96%B0%E4%B8%96%E7%95%8C%E...
Yeahhhhhh I'll be first in line for the "does not have the will for this" queue. Yuck.
The title of the article is not helpful.
Even "In 242 cities[1], 2/3 of homes are more than $1M" is better.
[1]where "city" is ambiguous
This assumes it is a problem that is being addressed.
When housing values soar, there are people getting rich off of that.
The "solution" is devaluation of people's assets, and all politics is local, and all local politics is housing values.
As clearly is a supply and demand issue. Supplies clearly being artificially suppressed.
Of course, the housing market merely reflects every other segment in our our "market economy"... Everything is Monopoly cartel or regulatory capture
My parents were whining a few months ago about the possibility of new apartments being built not far from their house. Why? More noise, more traffic, more people. Things that would impact the value of their nearly debt-free home.
Meanwhile most people my age (mid-30s) who don't have a home have more-or-less given up on the idea of getting one, and people their age (mid-60s) are having the possibility of property tax abatements thrown their way so that they can stay in a home until they absolutely can't anymore, or pass away.
The vast majority of American economic decisions are ultimately aimed at passing off more value into the hands of asset-holding retirees. Full stop.
Maybe they just don't want the noise and traffic, and they don't really care about the impact on their house value.
Seems like you're jumping to a conclusion.
I should have realized it, too, because when my parents tell me something, I know what they really mean, and it's not usually what they actually said to me.
So of course your parents want their house price to go up so they can pay higher taxes while surrounded by more traffic and noise. Seems so obvious now that you say it.
Good thing that my county now offers people of their age a way to abate property tax increases so that they can "stay in the home they've known for so long" or whatever the line was.
Well, good for seniors. Absolutely awful for the people my age who want to buy a home, start a family, and participate in the economy in ways that those things enable. But we don't much care about those people.
Anyways, thanks for clarifying things to me internet stranger.
Most homeowners just don't want things to change.
By describing it a "fear of change" you are assuming (I think) that the change is always good for everyone, people just "fear it" irrationally.
The reality is that most people choose where to buy a house based on some criteria of what they like and the lifestyle they want. Whatever it may be for them, but nearly everyone puts a huge amount of effort in considering what they want from a neighborhood and then try to find a matching location to buy a house.
If you come in and completely change the nature of the neighborhood, in a way that makes it incompatible with why they chose it, of course they'll hate it. You would too if it happens to you. Every human would, basic human nature.
Think, or feel? Rationally, most people might realize that over the decades places will change.
Emotionally, if you put it a huge amount of effort and more money than you've ever spent (or ever will) on anything else and then someone comes in and changes everything about it that you originally loved, you will hate it. Basic undeniable human nature.
Housing prices only come up when people try to engage in bad faith gymnastics about how actually they only paid 200K for their two million dollar house so they're totally just ordinary middle class people with middle class concerns.
It's much harder to act like the good guy when you're talking about turning a quiet neighborhood into a much denser neighborhood where the kids can't walk to school anymore because there are too many cars.
I never understand why people are so eager to turn a neighborhood they don't live in into something else rather than move to any of the multitude of neighborhoods that are already like that.
Imagine if someone wanted to change all the streets in your neighborhood to only accomodate bicycles but you own a home in the center of the city and commute 20 miles to a town in another county for work.
Unfortunately that means they can play both cards, they can benefit from scarcity while pretending to be anti-gentrification. And they can claim any pro-housing group is actually “pro scary capitalist developer”.
One especially frustrating part of it is that it really benefits nobody. Your home goes up in value, cool. You owe more property taxes. And all the other homes around you also go up in value, so… you’re really no better off unless you downsize or move to a cheaper housing market.
Something akin to Georgism seems like the correct answer. But how you get there from here? Beats me!
What specific policies achieve this is also a separate question.
Housing un affordability for the next generation coming up, starter homes in California are easily at least 500,000 the old two bedroom one car garage starter house I grew up in cost $550,000 today built in the 1925. There is no way anyone in the surrounding area for the most part make enough money to afford to buy it today.
The one thing that is going up all over the place across the country are those so-called luxury apartments which cost an arm and a leg even for a one bedroom studio, the one thing that is interesting or ironic. The only reason I can afford to buy anything is because relatively late in life bought as many shares of Apple computer as I could about 21 years ago.
Anyone coming up between 18 and 30 are in trouble unless their family is relatively well off and can help them.
A third world country like India has costlier real estate than any of those. A 2nd rate metro has apartments in high rise buildings for $500K - $1M. Unbelievably expensive. Then there are villa communities (equivalent of single family homes, suburbs), which are even more costlier. I keep asking people how do they afford these and how will this sustain, nobody has an answer about how these are afforded but everyone thinks the growth will continue. The usual problems of mosquitoes (dengue, malaria), water problems, power outages, lifts not working, worst air quality, etc, etc .... looks like the only thing copied from western world is super costly real estate.
Currently barely affording a condo in Jersey City (not Manhattan). Don't really understand why the prices are this high, none of these homes are selling, the ones that sell are vacant EB-1 investments of which there surely cannot be that many, and there's no way an upper-middle class family could afford this.
More ludicrously taxes keep going up, property tax is super high making it impossible for buying to ever be better than renting.
Everyone in tech keeps talking about how AI might usher in a permanent underclass but it's already here. It's not "you will own nothing and be happy" for most people I think it's already "you own nothing and aren't happy." It's very confusing what is happening with the real estate market but what is obvious is that local politicians and housing regulations have invented feudalism from first principles.
I genuinely do not understand the controversy here, imagine somebody said this about bread.
1) It is the 12th century. Local lords own all the wheat farms and bakeries. Bread is incredibly expensive, nobody can buy bread, people are simply buttering the bread and licking off the butter, and still having to pay a portion of their wages to help maintain the bakeries.
2) ~1000 years pass. Everyone looks back at that time as the worst economic reality in human history, the foundation of most political systems is the ability for anyone to own bread and operate bakeries, people can buy bread.
3) One day you go to the bakery to buy some bread and it's now $120 a loaf. You say WTF this is so expensive, nobody can buy bread anymore, but there are so many loaves on the shelf. You're informed all of these loavess are spoken for by the people in the parking lot who are apparently gambling on the value of bread.
4) Nobody is saying you can't gamble on the value of bread. Instead, everyone agrees it would cost less if we would simply make more bread. But the people in the parking lot, who are already rich and supposedly champion a totally free bakery, say we can't make more bread as that might drop the value of bread and reduce their portfolio value, which would be worse than starvation, so we must limit the bakery. This is obviously ridiculous.
5) Then somebody walks into the bakery and says, I am a champion of the working class, I am one of you, I too cannot afford bread, make me your leader! So you think amazing, let's put them in charge, they will make more bread.
6) Unfortunately, no, for a variety of reasons that sound like they were made up on the spot, they further reduce the supply of bread, stop people from building more bakeries, and install a series of their supporters to 'review' the grain quality of bread at great expense. Also, a very small group of people will get a loaf of bread for free.
7) The price of soars further, everyone agrees that all of this is making it even less affordable. However it becomes culturally unacceptable to reverse any of these policies.
8) You have obviously been betrayed by the current leader. One of the current leader's supporters decides they want to be leader. The other supporters, who again are responsible for this crisis, back this person and say this is the next leader. They say you cannot question them, you must put them in charge or you're to blame for the bread prices. They run constant smear campaigns against anybody who disagrees, branding them all the same as the people in the parking lot, and scare people on the brink of starvation. So fine, you put them in charge, but demanding they change things.
9) They say yes we have a great solution. The people in the parking lot who are gambling on the prices of bread will now let you borrow a slice from them. You cannot eat it but you may butter it and lick the butter. If the butter seeps into the bread, as tends to happen with butter, you will be charged for the cost of drying out the slice later.
10) It is the 21st century. Local lords own all the wheat farms and bakeries. Bread is incredibly expensive, nobody can buy bread, people are simply buttering the bread and licking off the butter, and still having to pay a portion of their wages to help maintain the bakeries.
Genuinely incredible
There is no level of banning housing speculation that will ever make prices go down. Housing speculation is only profitable because there aren't enough homes in the first place.
https://www.zillow.com/homedetails/404-W-Broadway-Centralia-...
Walkable. Passenger rail. Fiber internet. Affordable with a single income.
Unlike ancient European masonry homes in some of the most passive of climates globally, a 128 year old wood construction house in the central United States is not desirable for most people. This one is in a location that gets hot summers and cold winters. Homes of this age come with substantial upkeep and modernization costs, they lack modern amenities like central air and heating, good insulation, or even a kitchen that fits normal modern appliances, they creak everywhere and are drafty, floors aren't level or are warping, they have a distinctive odor that's impossible to remove, and they harbor surprises from all sorts of things that the last 7 generations of owners did for themselves over the decades. My family has owned similar properties in Missouri. The price is reflective of the market demand, not the losses the owner dumped into it.
https://www.neighborhoodscout.com/il/centralia/crime#descrip...
"How can there be a housing crisis when there are houses available for $1 in Pontiac, MI?"
It's a total bargain!