Must be a shitty lawyer. Go back to serving.
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“working as a server” - I have to get rid of thinking everything is about computers…
Responding to HTTP request all day is hard work.
For the last time, make the coffee yourself, I AM A TEAPOT!
I see an HTTP 418 in the wild, I upvote.
Not when every response is a 503 (taps head)!
For a second I wondered if it was an old timey job, similar to how one could be employed as a computer.
I mean, you needed someone to crunch non-financial numbers before machines were invented to do that. A major discovery in astronomy (the relationship between period and luminosity) that’s central to how we measure distances in space was actually made by a woman doing that job (Henrietta Swan Leavitt). If she’d lived a few years longer she likely would have won the Nobel for it.
I hadn’t heard of her, thanks for putting her name on my radar!
Well I mean…more and more people want to live in cities, and they’re not making more waterfront apartments. Lots of people want that apartment now, so the price is higher. I don’t know what you can do about that: you can’t provide a beautiful corner apartment overlooking the water in a desirable city for $700 to all the millions of people who want one.
It’s not just in cities. Property prices have skyrocketed pretty much everywhere. Maybe you can point out to some middle-of-nowhere place where this hasn’t happened, but such places also tend to have no jobs which is a problem for the typical person (so entitled, needing a job to live, I know).
Like where? I know towns that will offer you a plot of land for $1, so long as you promise to develop on it.
You do get high housing costs in places where populations are rising faster than housing development can keep up, or where development makes no sense (would you build an apartment block in a shrinking town?)
But like…I can point you to a bunch of cities in the US where housing prices are still quite cheap. You probably won’t want to live in those cities. That’s why they’re cheap. Supply and demand in action.
The problem is simple: in a perfect society we wouldn’t increase flat prices simply so a landlord can make even more profit. There is no actual, logical reason why the flat should cost 5x as much, only made up ones that basically say “but I wanna!”. There’s no actual 5x increase in costs for the landlord, they pocket most of that additional rent.
Living space isn’t something you should be able to profit this heavily from in a functioning society, as it’s a basic necessity to life. It’s alright that nicer flats cost more but nowadays we value huge additional profits to landlords higher than basic human rights, provocatively spoken.There is of course the supposed capitalistic reason of doing so, which is to make it more lucrative for others to build additional homes. Additional homes should in turn dampen the prices again. This however hasn’t been panning out the last few decades, as the prices have kept inflating.
That would be the case if it was as simple as, ECON 101: supply vs. demand.
To me, it seem to be a mixture of gov’t zoning laws (lobbied by corporations), foreign companies/people buying up land (to hold onto as an asset), and just more companies buying up the housing market to resale or rent out.
All of it leads back to zoning laws preventing more housing being built, and of the correct types. Most of that is caused by NIMBY types worried about the character of the neighborhood, and perhaps a bit of bigotry. It IS supply and demand, and short supply is caused by bad policymaking that nobody really benefits from.
Zoning laws: yes, strong agree, but the bad guy there isn’t corporations, it’s NIMBYs. People with houses don’t want any development of any kind near them, and being residents they’re the ones who get to vote on it. They almost always vote no.
Foreign people buying land as assets is a thing. You know how you defeat that? Build more housing. If the value of the assets fails to rise, or even falls, then people won’t hold them as assets–and by dumping them on the market, they’ll further decrease the price.
Companies buying up houses to sell (usually after developing or refurbishing them) or rent is ECON101 in action.
If you can solve problem #1, the rest falls into place. But corner apartments overlooking the water in nice cities are still going to be expensive relative to other housing.
Thanks for the reply!
Yes, you are right about the residents.
Similar problem with homelessness, people don’t want shelters near their homes, so homelessness keeps being a thing.
At least in the US, zoning laws and parking minimums have really restricted the ability of cities to build more housing in high demand areas. Look at how much space is wasted just for surface parking lots in downtown Denver, Houston, Austin, etc… Name almost any bigger city and soooo much valuable land is wasted on cars.
I also agree that real estate should not be used as an investment. If there was more restrictions around owning property in cities, that would certainly help. AirBnB/short term rentals are definitely not helping and should be heavily regulated/taxed.
You have spoken nothing but the truth, IMO.
On cars, yep, nothing will help as much as building up public transportation as much as posaible; electric/hydrogen cars are not the solution. A possible one with not too much building are increasing and improving bus routes and their frequency.
I was able to learn a bit from NotJustBikes and similar channels.
Zoning on buildings to parking space requirments are just mental.
Thank you for the feedback!
During these 20 years we already had 2 major economic crisis, one occurring right now and with no sight of ending. During that time, the central banks printed a shitload of money creating a shitload of inflaction. That plus the housing crisis, a great recipe to disaster.
Adjusted for inflation, that $700 rent would be $1,242 today. Not quite enough to get it all the way to the $3,600 they are quoting today. There’s something else very funky going on right now. A lot of cities are experiencing massive population loss… yet rental costs continue to rise. I’m sure the housing crisis has a large part to play in that, but it still doesn’t make a lot of sense to me.
It’s because the home owners think, if they charge too little, they won’t be taken seriously.
I think part of it is because of pricing software like RealPage.
On a summer day last year, a group of real estate tech executives gathered at a conference hall in Nashville to boast about one of their company’s signature products: software that uses a mysterious algorithm to help landlords push the highest possible rents on tenants.
“Never before have we seen these numbers,” said Jay Parsons, a vice president of RealPage, as conventiongoers wandered by. Apartment rents had recently shot up by as much as 14.5%, he said in a video touting the company’s services. Turning to his colleague, Parsons asked: What role had the software played?
“I think it’s driving it, quite honestly,” answered Andrew Bowen, another RealPage executive. “As a property manager, very few of us would be willing to actually raise rents double digits within a single month by doing it manually.”
I lived in a building that used this software. In 6-7 years, rent went from around $1200 to about $2,000. More and more apartments stayed empty. They kept raising prices during the pandemic. Surprise surprise, a tent city popped up down the street. A couple people died there.
It’s a financial bubble.
My two cents on this is that, the same house developers own a shitload of buildings in each city, meaning they basically up the prices quite a lot without competition to undercut them.
How we solve this goes from country to country.
In case of the US I’d say something must be done, either build more, or adjust economy in order to the middle class to be able to purchase in cities again.
In my country the issue is close to being the same, the main difference is that state regulation isn’t helping at all either, causing people who have properties to not even rent at all.
Rent incomes are taxed at 28%, plus the “IMI”, which is a yearly tax the Portuguese pay on properties, and the owner doesn’t even profit enough to pay for the damages usually caused by the renter. So they either up the prices like crazy (average rental in Lisbon is about 800€), or don’t even rent at all.
Edit: I have people in my family that inherited houses from deceased family and tried to rent it. The renters stole all the furniture, house applicances, everything, from 6 months paid only 2 and after being kicked out even came back to break into the house. Police had to be called to solve the issue but their hands are also tied so they can only give empty threats. Guess who’s never renting again.
In case of the US I’d say something must be done, either build more, or adjust economy in order to the middle class to be able to purchase in cities again.
Building more doesn’t solve the problem. There is vacant real estate already. If you don’t have a tenant for a property, you’re operating at a loss. A loss is a tax write off. With some creative accounting, it might be better to keep a place empty and increase the rate no one will pay you.
My solution is to devalue money.
A network of businesses and merchants that based on income, estate assets, and their contribution to the wield as recognized by the network, add a fee or a discount.
If you are living up to your potential doing good things, you can afford to spend less. If you have no income, but you are doing good to your abilities, potentially all basic needs are covered.
If you are hording value and causing harm, then you pay additional fees.
Combined, the fees cover the discounts. The economic gap grows smaller.
It would be massively more simple, and more profitable to government, to simply levy a colossal tax on property owners who leave their rental properties empty for more than six months or so.
Ah, they’re trying that in Portugal. It doesn’t work. They’re going even as far as expropriation the houses from the owner, forcing them to rent at state agreed rates.
My wild guess? The only solution is reducing inflation to the negative to make money more valuable.
Deflation can be even more destructive than inflation. It would basically make all kinds of debt more expensive, to which real estate is particularly sensitive. There’s a chance that could force over leveraged property owners to sell, but with more expensove debt, there will be fewer buyers and it would tend to be those who can take on the higher risk (aka the already wealthy).
All that is to say, I don’t have a solution either (especiallly if high taxes on non-dwelling properties doesn’t seem to be making an impact), but deflation is almost never good…
Yeah I understand the effect of deflation… Other solution would be increasing people’s wages by like 300%<…
My solution is to devalue money.
Isn’t that inflation?
Taxing more isn’t the solution, believe me there are countries trying that without success. The solution would probably revert the inflation we’ve been having for decades now, to make the money more valuable.
It’s not inflation and it isn’t taxation. It would be closer to deflation. However, this would be a few market program. Businesses would join it and there could be incentives for the customers to do business in this affiliated network.
In Canada, we don’t seem to have anyone trying to solve it. We have a housing minister who promises to make housing affordable without lowering existing home values. Can’t do one without the other…
Vancouver runs an average of 3800 for a two bedroom apt. Not a luxury suite. A standard, 90-00s era decor apartment.
During that time, the central banks printed a shitload of money creating a shitload of inflaction.
The Fed increased the money supply to prop up stocks, essentially giving cash to stock owners. 90% of stocks are owned by 10% of the population.
Average PPP loan forgiven is almost $100K, and that free cash only went to those doing well enough to own a business.
Meanwhile inflation caused by this effectively lowers workers pay and the real purchasing power of the minimum wage.
Working as intended.
Well, people who own lots of shit had to be properly compensated for owning lots of shit, otherwise - or so we are told - “they wouldn’t invest”.
It’s funny how we’re told to “work hard” and there’s even lots of criticism of the “workshy poor” all the while the entire economic system has been changed to maximize the returns of rent-seeking (which is the single most parasitical economic activity there is) at the cost of the returns from working AND the purchasing power of said returns (because life essentials like housing are way much more expensive).
This meme is so old, those prices have increased even more by now
posted 9 hours ago
Yep, that actually checks out.
I would imagine most homeowners couldn’t afford a loan for their current house at its current value. I just ran a borrowing capacity calculator for a local large bank, and it’s well below what my house is worth.
I bought at 21 and had it paid off at 38. I earn triple what I did back then.
That’s part of the reason I bit the bullet when I did and bought a house where I didn’t want to. I started building equity and when housing prices went up I was able to roll that over into a house I wanted in the area I wanted. At some point you have to get in and start building the equity even if it’s somewhere you aren’t as happy in. YMMV.
Yeah, but I honestly feel terrible for younger people just starting out. I’m locked into a 2.35% APR loan on a house that’s valued nearly 3 times what I bought it for less than 10 years ago. I would never be able to afford mortgage payments going in at today’s rates for the full value of the house, let alone come up with 20% to get rid of mortgage insurance.
The starter townhouse my wife and I bought almost 20 years ago has gone up similarly. What kind of person in their early 20s can afford to come up with a 6 figure down payment? Or afford a mortgage payment that’s several thousand dollars a month? Shit’s crazy.
It’s starting to look like that model might be dead too. Mortgages continue to rise, but prices aren’t coming down because everyone with 2% interest mortgages are never going to move, so there’s no inventory. This means that the prices will hold, but not increase. So even if you can get a house you don’t really want now, it’s not going to appreciate much, and might even slowly depreciate as the current owners are forced to sell because of life events.
A 47 year old lawyer should be able to afford $3,600 a month without particular difficulty. I’m a software developer so I make less than most lawyers do, but I can pay about $3,400 a month for my one-bedroom in the center of a big city.
(I don’t rent. $3,400 is my mortgage plus my building fees and the building charges an additional fee to people who rent out their unit, so if I rented mine out for $3,600 then I would probably actually lose money every month. Paying my mortgage does mean that my net worth increases, but it doesn’t help me afford things now. Someone with their mortgage paid off would be in a better position to be a landlord, but they would still be getting less than 4% profit per year even if they have the perfect tenant who never costs them anything. Selling the apartment and putting the money in the stock market would be more profitable than renting it out for $3,600.)
Being a landlord might net you 4% but then you have to live with being a human parasite.
The average yearly return of the S&P 500 over the last 30 years is almost 10% a year, so if instead of investing in the stock market, you choose to be a landlord whose yearly profit is 4%, you’re a humanitarian donating 6% of the cost of your apartment to your tenant every year.
I’m exaggerating because the average rise in real estate values is 6% so such a landlord actually gets about the same return as he would get from the stock market, as long as he never has a bad tenant and doesn’t mind his money being locked up in real estate.
And maybe trying to wring as much money as possible from everyone is contributing to making our world unlivable (for us).
Well that was in the past, but over the last 2-3 years I have lost a few thousand $ in the value of my S&P 500 index fund investments. That money would have been better off in a plain old savings account or invested in real estate (but it wasn’t really enough to buy any real estate).
You must have bought at the worst possible time. But there’s risk associated with any investment - the neighborhood you buy in could go to hell, or if you rent out your property then you could get a tenant who trashes it and takes a year to evict. I think real estate does tend to be less risky than the stock market, but it has significantly worse returns too. (Plus, the stock market lets you diversify - if you only own one property and something happens to it, you have lost everything.)
With that said, you can invest in real estate even if you don’t have enough money to buy property yourself - you can buy shares in a real estate investment trust.
30 years ago you couldn’t find a reasonable place to rent for $700 in my smaller NC city. Today the prices here are around $2000 for a reasonably nice apartment. I’m not saying there isn’t somewhere in the US where those rents can be found within that time period, but I’m skeptical there isn’t some exaggeration going on here.
This is absolutely true in Cincinnati.
20 years ago you could rent an apartment for $700 that today goes for 3500? That truly is crazy.
Which area of NC?? I lived in Hillsborough for a time, and 10 years ago I was able to get housing for $750/m. You’re saying that 30 years ago it was more expensive? I’d like some sources, because I think you’re either misremembering at best.
Greensboro, NC. Maybe not such a small town in NC, but small on a national scale. To be honest, my comment was anecdotal and from memory. But a quick search led me to deptofnumbers.com/rent/north-carolina/greensboro. It goes back to 2005 where the median residential rate was listed as $794. So, my memory is likely colored by what I considered as “acceptable” conditions as well as expense in 1993. I ended up renting a room, with no real kitchen, but a nice enough bathroom, for $400. Yes it was cheaper, but the kitchen was basically an alcove with a dorm fridge and a microwave at the end of the hall. It was not a place you’d bring a date home to. I recall that actual “nice” apartments I looked at were around $800 or so
Edit, whoops had to change to nominal dollars. 2005 median was $635.
Shit 20 years ago I rented a 2-bedroom place for $300 a month.
Most rent I’ve ever paid was $550/mo for 2-br with 1 roommate. Now I have a mortgage that’s under $800 on a 3-br house with land.
It’s achievable by living in a low cost of living area. When you live in the big city, you pay out the ass for rent and never can afford to buy.
Look up ‘Hell’s Angels’ by Hunter Thompson. He has a chapter on the economics of being a biker/hippie/artist in the early 1970s.
A biker could work six months as a Union stevedore and save up enough to spend two years on the road. A part time waitress could support herself and her musician boyfriend.
I think that’s part of the point. The system doesn’t want the majority to be able to say no to a job because they were able to save easily and can take time off whenever they feel. On top of the things mentioned here like food and insurance costs there are also other things now like being certified in a field or needing to continue education or paying for permits every year that seem way to calculated in cost which is just another way of keeping you from getting to far ahead.
My family does ok, but we were still cutting it close a few years ago. Today we are looking at new jobs that we hopefully can get and pay more because ours stopped giving raises and inflation has us stuck living paycheck to paycheck.
I wish I could take more than a few weeks off a year to do what I actually enjoy doing for once. 1 of those weeks is a cheap vacation and the other is just spent getting things done because work takes up most of our time. It’s stressful and tiring and the longer it goes on the more depressing it becomes.
Another thing to consider. Working folks used to be able to afford really nice things. In 1960, a Rolls Royce was about $20,000 and a Jaguar was about $6,000. A ringside ticket to the first Ali/Fraiser fight was $200. They want peasants scrambling for crumbs, not peers
Their current philosophy is an incredibly shortsighted mistake. You make money by having a robust consumer class with plenty of disposable income to spend on things they like. If most people are barely affording essentials, there’s way less variety in where money ends up. If I’m the executive of Samsung, I want to publicly support better pay and higher taxes, because it means more people can buy my TVs and phones.
I struggle to describe the situation because it actually goes against capitalism. The rich are pursuing the option that gives them less profit and hurts the free market.
there’s less variety in where money ends up
that’s exactly the thing rich corps want. Whatever money and power that’s left to go into their coffers.
I think you’re missing it because you’re still thinking in a national frame. Capitalists do not. If US workers can’t afford their products, they’ll just sell to Chinese workers. That’s part of why they’re so desperate to get into that market. Capitalism always requires expanding markets. It’s why the web is going through enshittification, also.
There is no nation for a capitalist, they may play at patriotism when it suits their interests, but in reality they will go wherever they can to make as much as they can. If that stops being here, they’ll go elsewhere.
The mistake you’re making is thinking that long-term effects are a concern in capitalism. They aren’t. The point is for the people at the top to make as much money as possible in as short a time as possible, keep milking the corpse until it rots, then fuck off with your money.
I’m sorry but they don’t actually want you to have money. They want you to have credit. Lots and lots of credit if possible. Because then they win twice. Once in the purchases and second in the interest.
True, but that still requires people to have enough disposable income that they’re freely buying things. To nail them on interest you want them to spend more than they earn, agreed, but it’s all a balance. Go too far, and they’ll pull back on spending, and you lose out doubly.
Look at the crypto bros.
We’ve gone so far off the rails in terms of the economy that it boggles the mind.
I was brought with the idea that the old Tsarist system of a few great land owners; a small middle class of minor merchants, tradesmen, white collar civil servants; and a sea of serfs, was always going to be unstable. That’s the idea the Right wants for all of us.
Till there be property there can be no government, the very end of which is to secure wealth, and to defend the rich from the poor. In this age of shepherds, if one man possessed 500 oxen, and another had none at all, unless there were some government to secure them to him, he would not be allowed to possess them.”
Adam Smith, “ Lectures on Jurisprudence” 1766
All states are unstable, because their function is to secure the wealth of the many in the hands of the few.
Hmm… I knew a Hell’s Angel when I was younger and he certainly didn’t work a union job. He was essentially a gangster, who made bundles of money doing illegal things.
So, you’re saying you have no concept of things changing over time?
He was a Hell’s Angel in the 70’s and 80’s, so it was during the same time period that the book was written about.the Hell’s Angels have always been a criminal organization, despite trying to paint themselves as a simple motorcycle club.
And there were bikers who weren’t in the Hell’s Angels.
Yes, but they’re not called Hell’s Angels. There are still bikers who aren’t in the Hell’s Angels. I’m replying to someone who specifically said “Hell’s Angels”. If you’re a biker that isn’t a Hell’s Angel and you call yourself one, you’re going to have a real bad time.
A biker could work six months as a Union stevedore and save up enough to spend two years on the road. A part time waitress could support herself and her musician boyfriend.
The name of the book was ‘Hell’s Angels.’
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No, that’s only one of a much larger suite of factors.
Wealth inequality was much lower in the US after the war: http://piketty.pse.ens.fr/files/capital21c/en/Piketty2014FiguresTables.pdf Europe building back should mean the total pie is bigger. The real problem is that the wealthy parasites are sucking up more and more of a proportion that pie.
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The distribution of that pie is also being skewed. Technology has brought prices slightly down (relative to income) for a lot of things that we buy, meaning that we get better prices and more variety on things like food, clothes, travel, and obviously electronics, but a couple of unavoidable things like housing prices and college tuition have exploded so dramatically that it totally overshadows the modest gains that we get. Both are things that only need to be paid for once, so anyone that went to school and bought a house before prices exploded now gets to enjoy cheap housing and cheap commodities, while anyone unlucky enough to come after is just screwed. I think that’s part of why older generations are so unsupportive of how much of a struggle it is for millenials and gen Z, the economy has gone to crap, but so far its only really hit the young
I think that’s part of why older generations are so unsupportive of how much of a struggle it is for millenials and gen Z, the economy has gone to crap, but so far its only really hit the young
Most of us older Generations though have kids of our own, and so we see how today’s life affects them, and the fact that we usually have to help them out because they have it much harder than we did at their age, so we’re aware of the situation.
What it comes down to is a human nature type of thing, where some people think “I’ve got mine and I don’t care about anyone else”, and that transcends physical age.
Yeah, it certainly isn’t everyone in the older generations, no group is ever a monolith. I was generalizing the general sentiment that I’ve seen, but I’m also in an ultra-conservative area that tends to be very “pull yourself up by your bootstraps”, so my perspective is probably skewed too.
I was generalizing the general sentiment that I’ve seen
Fair enough, and I thank you for the clarification.
The only reason I replied was because comments like these tend to really bother me, because as I get older, I find I become the recipient of ageism more and more, which is a form of prejudice.
I definitely do agree though that older generations have certain opinions and ways of thinking that they can be set into, but that doesn’t mean they can’t rise above that.
Just slapping the “Boomer” or “Neckbeard” label on everything and moving on feeling victorious is never a good way of solving any society problems.
And on a personal note, as a Gen-Xer constantly being called a Boomer, it reminds me of that line in the Monty Python movie where Death comes to a dinner party and picks up all these people who just died to take them away because of some bad food that was served. Theres one guy in the group being taken away by Death, and he says “hey I didn’t even eat the salmon mousse”.
To be fair, if you ever wanna reconsider your job, ask a server how much they make. In a city with $3,600 rent, it’s not uncommon for them to average $40-60/hr. Shit, I’m ugly as fuck and live in a cheap city but usually made around $1,000/week working part time in college a few years ago.
Huh? Where in the world do you live?
Servers don’t make that much. These days restaurants are asking their customers to tip and pay the servers for the extra rent costs.
I imagine that they were using the tips and then averaging their total revenue per hour.
People think I am full of it when I say that my household income (largish household with kids) is a quarter million a year and we are basically living like we are middle class. Money just doesn’t go as far as it used to.
As a millennial, I never would have imagined working my way up to this point only to find I can’t even buy a house. Oh sure, I could make the bare minimum down payment and get stuck with a super high mortgage payment, but if I lose my job or become disabled or unable to work, we would have no way to pay for it.
Groceries, housing, and insurance costs have more than doubled for us since 2019.
Sounds like you live in HCOL area where $250K is pretty much middle class.
250k household is not middle class anywhere in the United States.
$250K is borderlining middle class in San Francisco and Seattle.
Same. My wife and I are in the process of trying to buy a house over an hour from town, because it’s the only way we’ll ever be able to afford one, and it’s still more than what our landlord paid for the house we’re renting. Housing prices have tripled in the last 8 years here. They doubled in the last two years alone. The house we’re renting would cost a million dollars to buy today and our landlord has a $1000 per month mortgage on it since she bought it right before the housing explosion. It’s pretty wacky that you can become a millionaire just by having been alive and financially stable a few years earlier, while everyone else is destined to be poor for the rest of their lives, even if they’re making a quarter million dollars per year.
The house we’re renting would cost a million dollars to buy today
Where in the world is this?
Also, is that a high-end neighborhood or a middle-class/lower class neighborhood?
It’s a normal-ass 1960’s neighborhood that your parents would have paid normal-ass prices for. The job market here exploded over the last 20 years, so there’s just too many people and not enough land. I’m one of those people, so it’s not like I don’t contribute to the problem.
There are neither too many people nor not enough land, but too many houses from the 60s passed down with initial property tax values and too many NIMBYs preventing new construction of large apartment buildings.
There are tons of big skyrise apartment complexes and dozens more in the works. But they all get labeled “luxury apartments”, despite basically being tiny little rectangles with no windows except for a sliding glass door at the end, and they cost just as much as a house to rent. The more traditional apartments have mostly been converted to condos and they’re also very expensive. It’s just crazy expensive here, despite your choices! Lots of people commute for over an hour each way and then it’s still a half million dollars for a decent house. You have to live at least an hour and a half in the right direction to get something for less.
My family house that we sold recently, sold for $1.2 million. It was bought in 94 for $90k. Expensive town, but the cheapest neighborhood in the town.
Expensive town, but the cheapest neighborhood in the town.
I would expect that in the expensive towns, but not in all towns. Your basic supply and demand situation.
While it’s not quite as much, I’m in what was once the cheapest town within 30 miles in any direction, and our housing prices have gone up 800% in the last 20 years, compared to the 1000% in the other city I mentioned.
Rental prices are up about 1000% since then too. My first apartment was $400/mo in the early 2000s. That same apartment is now $3500/mo, and it hasn’t even been renovated.
Average SFH price in many west coast cities is approaching 1M. 990k on average for my city
But that’s only in the most expensive towns in those coastal cities.
The OP replied to was making it sound like all houses in the US was like that.
Most houses in desirable parts of the US are that bad. The cheap housing is in places that people don’t want to live, be it for location, job opportunities or culture/local laws.
And it’s not just the expensive towns. It’s any town. My childhood home an hour away from a major city has exponentially gone up in price, just as the ones in the city have done.
And it’s not just the expensive towns. It’s any town.
I don’t want to defend corporations that use real estate to gain profits, but at the same time, it’s not just any town, and I know this for a fact, as I started out by buying a very low price but very nice house that required a very long commute to my workplace, for low pricing.
They’re definitely needs to be an adjustment in salaries to match everything that is purchasable today, but to say that every housing in the country, no matter where it’s located, is not affordable is just not true.
$250,000 a year is middle class and has been for a long time - it’s about how much a doctor (who isn’t in a particularly high-paying specialty) makes. But DINKs with that household income could afford a million-dollar house.
By what definition of middle class are you considering $250,000 to be middle class? That’s greater than the 90th percentile income.
They’re saying that someone that makes $250,000 today lives the lifestyle that would have been considered middle class 20 years ago, not that that salary is at all a median
They absolutely do not live remotely like middle class people from 2003. I graduated high school in 02 and my parents were mailmen. The difference in living standard is not even close.
It is crazy that you think this.
I wasn’t saying that I thought that, I didn’t give my take at all, I was trying to be helpful in explaining what the other commenter meant. But since you’re calling me crazy…
To give my take on it, you’re right, there’s all sorts of ways that the lifestyles aren’t at all comparable, many things haven’t had the insane inflation that real estate has, so a person making 250k can obviously take a lot more vacations, go out to dinner more, buy more tech, etc than a middle class person from a few decades ago. But when it comes to buying homes, it gets a lot more comparable. Homes where I grew up have increased 4-5x in price over the last 25 years, so a family with a household income of 60k-ish (which is solidly middle class) buying a house that’s 3x their annual income would have been pretty typical in the early 2000’s. Now, if those same houses are being bought by households making 250k, it would be basically the same ratio of 3-4x their income.
So in home purchasing power (and that area only) low 6 figures is absolutely middle class, and anyone making under 6 figures has the home purchasing power of what used to be lower class
My personal definition of “upper class” excludes anyone who actually has to work. Wikipedia seems to agree, putting “CEOs and successful business owners” in the upper middle class. And the New York Times considers the 90th to 99th percentile of earners upper-middle-class.
I do see some places defining “upper class” as those earning at least twice the median household income (so about $150,000) but I don’t think that matches common usage. Is a software developer right out of college upper class? Or a nurse practitioner? I would say “clearly no, unless they happen to be from a very wealthy family”.
Yes, a software developer in the 90th percentile of household income, making a single income, is most assuredly “upper class”
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Except everywhere is getting more expensive, not just gentrified neighbourhoods. And a middle aged lawyer should be able to afford a 1 bedroom anywhere in the world, it’s ridiculous what housing costs now.
The issue here is buying power is dramatically dropping which is a function of both wages and prices. Raising the minimum wage alone won’t fix that; instead, price controls will have to be implemented such that all housing is bought back down to prices that are satisfactory to consumers. That can’t happen without federal legislation.
Price controls cause shortages. The solution is plain old taxes - take money away from the rich. Housing will be cheaper to buy up front when recurring taxes are higher. Your dollar will go farther when other dollars are removed from circulation.
We need more housing in general too, to be honest, and to stop people buying it and directly distribute the housing to families looking for a primary residence.
Tax the shit out of the businesses that are holding onto these houses. Extra penalties for letting them sit empty. Special tax for companies with more than x% of purchasable inventory within certain regions. A lot of this could be fixed by taking money away from the people hoarding it.
We need to tax holding property as an investment if you aren’t living there or using it for your business. I’m not sure if it’s already taxed as capital gains or not, but it sure as hell should be. There’s nothing wrong with property being an investment – you should think of your house as an investment – but there’s a significant problem in treating property like stocks.
The best way to reduce the viability of housing as an investment is to just build more housing.
And no, you ideally should never think of your house as an investment, because that means housing prices are rising.
There’s fairly few units that people are just letting sit unused and empty.
In 2022, 23% of vacant for-rent units were vacant for less than a month. Only 26% were vacant for more than 6 months.
There’s more vacant housing “held off market”, but keep in mind that includes housing occupied by people with usual residences elsewhere, housing that’s currently held up in legal proceedings, housing currently under construction or repair, or in need of repair. The amount that’s being held off market by Blackrock to keep prices high is tiny at best.
Vacancy taxes have been tried, and their effect is generally fairly small. That’s not to say that they’re bad, just that they’re only a small part of a larger solution.
A 4% tax on millionaires in Massachussets got free lunch for school kids in the state
Is this actually true or just post hoc ergo propter hoc?
It seems like we shouldnt need a tax on millionaires just to pay for lunches. It’s more depressing than we weren’t paying for lunches more than it is inspiring that we are now.
IMHO it’s not just to pay for lunches (or whatever else); the primary goal is to limit price inflation and housing speculation. The fact that it generates revenue is an added bonus.
It’s more depressing than we weren’t paying for lunch
Because billionaires lobbied congress to reduce budget for public schools
Rent control is absolutely not the solution. Building more is the solution.
How about regulating all the big companies - prohibit sitting on apartments to drive up rents, limit Airbnbs,that sort of thing.
How would limiting housing get more housing, exactly?
Where does he say “limiting housing”?
“prohibit sitting on apartments to raise rent” which idk what it even theoretically means, and limiting AirBnBs, are both means of constraining housing.
Some estimates put the number of vacant homes upwards of 30% a few months back, and it’s been climbing
It’s not about a lack of supply, it’s about homes being both an investment and a basic need - someone like Black Rock can go into a small town in Georgia, snap up every property that goes on the market, then dictate rental prices while jacking up the house prices by bidding on everything. Even if they greatly overpay, by doing it a few times it drives up the valuation of the entire area, overall making their net profit grow
And it’s not just Black Rock, it’s a bunch of investment companies doing this everywhere. They have the same goal and their interests are aligned - they’re not competing for tenants, they just want to jack up the values and use homes like stock investments
you forgot that most country which has this house price problem actually build houses and apartment more than enough for all the homeless hence you would see lots of ghost town everywhere, economy now doesnt work as intended, you can build more house but without regulation despite the supply the price would still skyrocket like now
Only for it to be snapped up by corporate interests and not handed to the families that actually need it.
We need a list of all of the families and single people looking for a primary residence, build new housing, and just give it to them first. No buying allowed.
Ehhh, you’ve got the right spirit, but that won’t happen lol.
What would be useful is banning, or at least limiting, speculative real estate ownership. A liveable home being unoccupied for no productive reason is a massively arrogant thing for a society to allow.
Some estimates put the number of vacant homes upwards of 30% a few months back, and it’s been climbing
It’s not about a lack of supply, it’s about homes being both an investment and a basic need - someone like Black Rock can go into a small town in Georgia, snap up every property that goes on the market, then dictate rental prices while jacking up the house prices by bidding on everything. Even if they greatly overpay, by doing it a few times it drives up the valuation of the entire area, overall making their net profit grow
And it’s not just Black Rock, it’s a bunch of investment companies doing this everywhere. They have the same goal and their interests are aligned - they’re not competing for tenants, they just want to jack up the values and use homes like stock investments
Prices are a matter of supply and demand.
Housing starts plunged during the Great Recession, and recovered to only mediocre levels. However, over that time the population continued to grow.
We fundamentally have a housing shortage, particularly in places people want to live. One massive problem is that it’s currently quite difficult to build net-new housing in places people want to live, due to a combination of overly-restrictive zoning and NIMBYs who ate empowered to block new projects.
The problem is particularly bad in popular urban areas. Either you build outwards or you build upwards. But if someone wants to live “in Boston”, “in NYC”, etc, they probably don’t want to live in a new build an hour’s drive away from the city in traffic. And infill development is generally highly regulated.
Adding a price ceiling without fixing the underlying shortage is going to benefit the people currently living in an area, but it will make it harder to find a new unit. Adding units isn’t the only important thing, but it’s pretty important.
Also don’t forget that people don’t like housing built near them because it “drives down housing prices.” Homeowners themselves are more a problem than corporations are.
Then we need master lists of who currently lives in an area and for how much, and who wants to live in an area based on housing bids, homeless populations, etc., like with an application or something.
Or, hear me out on this, we could build more housing.
We could do this by upzoning basically the whole city, and by disempowering NIMBYs. Make it so that every location can build just a bit more densely, by right (i.e. where the approval is automatic).
Make it so you can build triplexes by right in what was an exclusively single family zoned area. Take areas with apartments and let them build a few stories taller. Let neighborhoods evolve into density over a decade or two.
There are 25 empty houses for every homeless person in the US. There are people like Bezos who own multiple $25 million dollar mansions, that sit empty 300+ days a year. There are places with housing shortages, but that is not the case nationwide. The problem is that our government cares little to ensure adequate housing for its population. It sees absolutely no issue in allowing property to be hoarded by the rich and used to strangle the poor.
Fun fact: homeless people can’t afford mansions.
Build them places to rent.
Fun fact: Every mansion or luxury condo built is 100+ affordable units not being built.
We’re building at record rates in many places, but just building housing does nothing but line the pockets of developers, because they will always choose to prioritize more profitable ventures, and current methods of requiring a small single digit percentage of their units to be “affordable” aren’t cutting it.
We need to be specific in what we’re building, and who we’re building it for. People moving in from out of state with high paying jobs are often prioritized by city and county governments because they increase the tax base, but this simultaneously raises rents for all of the current residents in crises as the market is dragged up. If we’re not specifically building affordable housing for local residents within each effected community to the best of our ability, then we’re only going to exacerbate the issue further. I’ve lived through “just build more” in my state for 20 years, I know how it goes.
If you build any housing at all, you are opening up “affordable housing” at the bottom of the totem pole. That’s how buying houses works.
No one is going to build a dumpster apartment to rent on the cheap. There’s no incentive there.
Let people build and the less-desirable homes will be scooped up as prices fall. It’s basic supply and demand.
Your state, like mine, has probably been kneecapping development in favor of NIMBY policies for those 20 years
No, they haven’t. They’ve been working hand in hand with developers to entice new money for them to tax, and ignoring the poor who only get poorer.
In my area they’re knocking down the “affordable” homes to build luxury and everyone is also trying to do everything to stop “affordable” housing. I say “affordable” because everything is still beyond what today’s “middle class” can even fathom to affordable and what they’re knocking down to build on is already pricing people out.
Knocking down single-family or small unit homes to build more multi-family housing is a good thing actually.
I live in the north area of the San Francisco Bay Area and there is a shocking number of new builds happening right now. Soooooo many apartment complexes and housing developments. It seems like every day another one has begun. Just on the street I work on there have been three very large apartment complexes put in where there used to be businesses within the last two years. On my 8 mile commute home I pass four more, where there used to be pasture land. This area is known for it’s NIMBYs but laws have been passed (by voters) requiring more housing and it’s happening.
