Housing Bubble 2: Return of the Ugly

rent_target = your_income - beans - tent

It can take like 20 years though

I work in the development department of a city that's and enclave for the ultra-rich. Literally every household in the city is millionaires or better.

Every house in the city is unique. Every build site requires civil and structural engineering. Every home has an architect designing it to be a unique structure. The average new build here is 8-10 million dollars, with the big ones being 50 million+.

We're talking tennis pavilions on the roof, indoor arboretums and galleries, the works.

And they're all built cheaply and fall apart within a decade.

They're shitty houses, but when people are dropping 8-figures on them, they can afford to drop a couple million more on a remodel every 5-10 years.

You can't buy a quality house anymore.

Your comment shows American relationship with space of their homes. I live in <1500 sq feet home with my girlfriend and I wouldn't call it claustrophobic.

Where are you looking?

Mass market single family housing is a disease that the developers have perfected. Using the cheapest materials, in the cheapest way, with the laziest inspectors.

This is what drives me crazy every time I hear people talking about needing to build more housing.

There are regional housing shortages. The classic example is in Northern California (particularly around San Fransisco and San Jose) where you've got these huge tracks of ranch-style homes and barely any vertical development. A lot of that is due to the seismic activity in the region, making taller buildings more expensive to construct. But more is due to the historical development practices of throwing up a thousand cheepo ticky-tacky units on real estate they acquired dirt-cheap from the state and flipped as fast as possible. Now the land is developed as this low-traffic sprawl, and people are obsessed with propping up their land-value to justify the seven figure notes their carrying. So building denser housing is politically and logistically prohibitive.

Basically, the problem isn't a housing shortage so much as a shit job of urban planning. Yes, houses exist, but they're hours away from job sites with no quality mass transit to move people between residence and work. No, you can't just pile people into these low-occupancy (often badly maintained) units if they don't have the kind of money to afford their own cars, pay for childcare, afford the utilities, cover maintenance of the units, etc, etc. That's a recipe for slums.

At some level, you need to actually plan your residential economy. That's a harder kind of work that politicians and bureaucrats elected based on their cool Tweets and Instagram feeds don't really want to do.

True, but it is not just about that there are X million houses emtpy and Y million people homeless. It is also about location of those empty houses. That might not overlap with location of the homeless, and I guess we are not talking about forced relocation here. There is probably still a good overlap of locations of empty houses and homeless and that part needs fixing.

A more functioning government would have immediately dropped the hammer on said business practices.

We live in a Corporate bordello.

Add in other corps:

20% of all property purchases are for investments: 65% of those properties purchases are by people who own 10 or more properties.

Exponential increase for each and every additional unit (house or apartment) vacant for more than 3 months (without undergoing active, actual remodel with a set end date for the work) in a given year.

Oh no, not enough people for every unit to be filled? Bummer, better divest starting with single family structures!

Edit: actually, now that I think more about it, I see absolutely no reason we shouldn’t just hard cap the number of housing buildings any one company or individual (no shell companies and whatever bullshit loopholes) can own if they didn’t originally build them. Let’s say 200 multi-family (apartment) buildings or 10 single family buildings. Anything more than that must be sold for whatever the market is willing to pay. Too bad, so sad if you lose money on it, that’s the risk landlords are always telling us they take.

Nobody needs more than that, at all, because housing shouldn’t be a commodity to profit from, and if they want more buildings to profit from, they can build them instead of just buying it as a ~~leech~~ investment. Fuck companies who treat everyone like shit for profit.

https://www.commondreams.org/news/wall-street-buying-houses
Emphasis is mine.

"The real estate industry would like you to believe the problem is entirely one based on supply and demand," and that regulations need to be changed to allow for the construction of more affordable housing, reads the report. But with 16 million vacant homes across the U.S.—28 for every unhoused person—"the reality is that the owners of concentrated wealth... are playing a more pronounced role in residential housing, thereby creating price inflation, distortions, and inefficiencies in the market."

Take it easy! Balance will trickle down any day now. We just have to trust them to regulate themselves a little longer. They wouldn't deliberately sabotage the market for profit, now would they?

I bet someone who has no where to live would still happily live there over nowhere

A couple percent of the housing market is also going to always be vacant due to turnover as well. That accounts for a large portion, if not the majority of that 16M.

Just wait until we find out that Blackstone's algorithms, trained on actual real estate deals, are giving preferential treatment to a man named Dave with bad credit over a woman named Lashawnda with good credit.