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Location: Live:Downtown Phoenix, AZ/Work:Greater Los Angeles, CA
27,606 posts, read 14,604,784 times
Reputation: 9169
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Quote:
Originally Posted by BoBromhal
are you under the impression that corporations buy when prices are high, or prices are low? Or are you saying (example) Google is buying homes in Silicon Valley so their new employees have a place to live?
I'm saying that when prices were low (2009-2012), the average buyer (one needing a mortgage) couldn't take advantage of the low prices, as they were outcompeted by cash offers from investors and corporations
The Central Banks with their near-zero and even negative interest rate policies have completing distorted the housing market.
This is where the massive inflation has occurred.
As I posted earlier, the government interferes with free market equilibrium. Gov't regs can create "bubbles" like they did in 2007.
In the case of manipulating interest rates, they are causing another housing valuation bubble, and they are also giving Americans the false impression that our national debt is affordable, when in fact, it is not.
If interest rates normalized, and we had to pay 5% on our national debt, it wouldn't take long before our entitlement payments & benefits would be in the danger zone.
Location: Was Midvalley Oregon; Now Eastside Seattle area
13,073 posts, read 7,511,991 times
Reputation: 9798
Quote:
Originally Posted by Vlajos
Build more homes. Reduce building code requirements so construction costs are reduced. I would start with those.
Go back to 2x4 exterior stud walls, remove insulation requirements, 14-2 wiring, 100 amp service, single pane windows, 82% efficiency gas furnances, remove water well restrictions as to number of wells in given area and distance to septics fields. Remove requirements for streets, sidewalks, underground utility lines, remove system development charges-homeowner installs at their cost and if they want them. Remove fire and police taxes. Remove setbacks. No minimum or maximum lot sizes, Unlimited street parking. No garage requirements. No roofing standard. No maximum occupancy limits.
That will reduce or plateau the value of currently built homes... facing push back from people who already own. So likely it won't happen.
Where I live, a small town, they did build a massive complex of 300 new homes.... they started at IMHO an insane $550 and are now up to $850 before they even got built.
I am also frustrated that when new homes are built they are usually just too big. In this day and age who needs a 5 bedroom 3 bath home?
They need to start building mini homes. 2 bedrooms, 1 bath.
Buy a lot and then build your 2/1. Quite simple. I did it and had a 3/2 built..1900 sq feet.
Plenty of build on your lot builders with plans that you can customize.
And no, you do not have to be rich to do that.
Just be thankful most of those nice new vehicles will end up on the resale market. Be thankful your neighbor paid the 40% new car premium for you.
And like with housing in many markets, government regulations are making new cars unaffordable for much of the middle class. With the Obama administration, which was anti-car, that was a side benefit.
As I posted earlier, the government interferes with free market equilibrium. Gov't regs can create "bubbles" like they did in 2007.
In the case of manipulating interest rates, they are causing another housing valuation bubble, and they are also giving Americans the false impression that our national debt is affordable, when in fact, it is not.
If interest rates normalized, and we had to pay 5% on our national debt, it wouldn't take long before our entitlement payments & benefits would be in the danger zone.
Why do you think normalized interest rates are closer to 5%?
In Austin, we've gone through a decade of housing prices soaring. What used to be cheap neighborhoods, have been replaced by very large, very modern homes that were built after scraping the 2/1 off the land. And those who inhabited the little house now are pushed out of the city, where there are still pockets of affordable houses.
The thing is, no one wants to build little cheap houses when they can build 850K houses. It would be really nice if builders who wanted to build 2/1s and 3/1s with limited expensive features, linoleum floors, were given a tax break to do so. There are families who VERY much want to buy a home, or single people, but there is no market and they don't need a monstrosity. Or they don't want to live in a million dollar condo downtown.
why does the owner of the little 2/1 teardown get pushed out of the city? They CHOSE to sell.
Do you understand the difference between fixed and marginal costs?
Between supply and demand? Or are these 850K homes just sitting there and not selling?
Not true, sky. I was a college graduate, three years out of school, in a well paying field in Dallas and i could not afford to buy any house in the city a little over 30 years ago.
You're exaggerating. Now maybe you would not have wanted to live in those parts of Mesquite or Oak Cliff, but if you had the downpayment (usually the biggest issue), you could have.
As I posted earlier, the government interferes with free market equilibrium. Gov't regs can create "bubbles" like they did in 2007..
I suspect that was just a ruse so that real estate developers could take great profits.
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