Considering how crazy expensive accommodations have become the last couple of years, concentrated in the hands of greedy corporations, landlords and how little politicians seem to care about this problem, do you think we will ever experience a real estate market crash that would bring those exorbitant prices back to Earth?
No, unless we separate housing from investment, it will never be affordable. I don’t foresee the political will to make it happen.
I suspect that a strong push for fully remote work would help the US with housing costs due to a chunk of the workforce moving out of the cities and into the boonies.
That already fucked long island. “Everyone” moved out of NYC and bought all the housing on l.i when COVID hit and WFH started, now it’s completely unaffordable for anyone under the age of 40 and/or unmarried.
The listings have just become a joke. 300k+ for a twice burned down shed posing as a house in a flood zone and in the worst towns. It’s absolutely asinine…
No. Expensive housing is a genie in a bottle.
Once sufficient people have purchased a house at the high price, it would be in their interest for prices to remain high. Corporate entities that buy up houses will actively lobby to make sure housing prices stay high, and the average Joe who paid that much for a house will be happy it stays that way.
I’m not so sure. Large lobbies have greater economic power than us average people, but they aren’t strong enough to defy macroeconomic trends. There are many factors that could turn and cause prices to collapse, we just don’t know when or if they will occur.
The only factors that can cause the collapse of a captured market are regulation, total market collapse, or revolution.
Total market collapse is very broad.
No, at least not in countries (e.g., the USA) that rely on the state to micromanage every aspect of zoning, and which therefore allow NIMBYs to derail progress at every possible step.
In a better world we would draft new laws to throw out our entire zoning system, and start over with something much more flexible at the state or national level- ideally based on the approach Japan uses, which defaults to mixed-use for every building and makes NIMBYism structurally impossible.
I think zoning is a related and secondary issue, but so long as the housing market is a market, and a few people have almost all the money, all zoning changes can do for housing prices is temporarily alleviate the problem. People with money are always looking for places to park their capital and collect rent. There’s no better vessel for that than real estate.
Obviously, we need to gut literally every aspect of American urban planning for a million other reasons too, but on this specific issue, I think it’s second order.
Not only no, but you better get a burial plot while you can afford it.
Just throw me in the trash!
I can’t speak to other markets but in California, the housing bubble is in part supported by investment from around the world. Chinese and Russian nouveau rich are buying homes in CA because it’s a safe place to keep their money relative to their other options. They might even just leave them empty and watch them appreciate. It’s disgusting, when people are struggling like hell just to live.
Perhaps the state could regulate this and ban international purchases or empty homes but I highly doubt it since the horse has left the barn decades ago and this would deeply impact many rich people, and those people have influence. It would also tank the home values of many average Americans, which would be deeply unpopular as many of those folks are banking on taking that value with them to Mexico or Ecuador to retire on. So this regulation would be bad for the rich and unpopular at large. It would help the young and the poor, the two chronically underrepresented groups.
So unless we can change the entire world order, I don’t see this wholly going away. Can we make it better? I think so. We need more supply, and it needs to be high density and low cost. Those are not insurmountable. But right now, private developers and the government don’t have what it takes to do anything.
I know someone who works for a low income housing non profit and they manage 8 big apartment buildings that their non profit built or bought and they operate them as homes for low income people. They are funded by philanthropists large and small as well as some public money.
If we could find a way to direct more money to such things, we could make a real impact. Perhaps a wealth tax that goes directly to such housing.
But even then, it’s like MediCal - it will only help those in abject poverty. It wont help my cousin who is making $125k and still can’t afford to buy a home. Middle class will never get help, basically, and this is why you see them moving elsewhere.
I know parking lot minimums make it hell for new stores to be built, but does it also affect mid- and high-rises? Because that would fucking suck if that’s another reason it’s hard to make affordable housing.
Want prices to drop?
Stop buying houses.
Eventually the bubble will burst.
The economy will be shit for a few years. And Eventually things will return to normal.
Gee, I never thought about all these houses that I was buying without a second thought! Damn, no wonder the prices are going up like crazy!
Sarcasm aside, a lot of real estate is being bought by rich assholes and companies that keep rolling debt on top of debt and using their owned property as collateral for getting more loans and keep the ball rolling. This was the case in 80s Japan and is the current case of USA (almost like a repeat of 2008) and China. If the previous bursts are anything to go by, prices won’t go down.
No. Stop hoping and take the houses instead.
