The housing bubble and unsustained pointless growth in suburbia (appliances, credit)

[djdairyp]

Suburban Housing Markets Are Unsustainable (Part 1) -- Seeking Alpha

Read part 1 and the part 2 link at the end of that piece.

Interesting comparison to Japan, draws some good ties. Also the rise of McMansions is discussed in the article and how we are worse off for it. Seems so true.

[Scotcha]

Great article.

[dman72]

There's truth in it, but also, it misses what really happened. Stuff is really cheap now. The same small house he grew up in is proportionally much more expensive than it was when his parents bought it. Per capita income is down since then...health care is much more expensive, education is much more expensive. Everybody looks at some big houses, thinks everyone is living in them, and paints that as the issue. They are only a symptom. Even if you buy a 3 bedroom 1950's cape, you're still paying a lot more for it now than your parents did...and then all of your other necessities are more expensive too. What's less expensive? Chinese made electronics. So yeah, we have a lot of that stuff. In the grand scheme of things, the stuff is irrelevant to that reat story.

[djdairyp]

Originally Posted by dman72

There's truth in it, but also, it misses what really happened. Stuff is really cheap now. The same small house he grew up in is proportionally much more expensive than it was when his parents bought it. Per capita income is down since then...health care is much more expensive, education is much more expensive. Everybody looks at some big houses, thinks everyone is living in them, and paints that as the issue. They are only a symptom. Even if you buy a 3 bedroom 1950's cape, you're still paying a lot more for it now than your parents did...and then all of your other necessities are more expensive too. What's less expensive? Chinese made electronics. So yeah, we have a lot of that stuff. In the grand scheme of things, the stuff is irrelevant to that reat story.

I do agree with you that almost everything has gotten more expensive, and I am not sure the author would disagree with that, but I think his main point on that issue relates to how we are a creditor nation and all of our stuff and large houses were very much based on people over extending themselves and using their equity for waste which is now disappearing. We certainly do have more stuff and a lot of that stuff is cheaper (walmart, electronics, etc ...) sometimes it seems a little out of control and consumes us. Some would say QOL has improved, I am not convinced and I am somewhat jealous of the life my parents led.

I think that what he is saying is how we have lost some of our 'community' nature due to more time spent working and people treating homes like investments flipping them and sometimes unnecessarily growing and improving them all the time encouraged by the govt and industry and if there was more restraint we would not be in such a mess and be better off.

Have you ever notice that there seems to almost never be modest houses built anymore. Anything built from 1990 and up seems to be massive. I have heard this is due to the fact that the land is expensive and the relative cost to build a small house vs a big house is not that different so all houses are built bigger to fetch a larger price tag. Do we really need these massive homes with granite counter tops and stainless steel appliances.

Anyhow, the authors discourse on Mcmansions seems more of an exercise in nostalgia, but I was really intrigued to read his summary of events before/during the bubble and where we are going. Its amazing all the greed that is allowed to persist and drive us into this hole. Its amazing to watch reports of housing oversight commities in the goverment where they specifically indicated the problems we were heading for in the early part of the decade and the govt ignored them in the face of growth. Millions were made and many knew what was going to happen.