The U.S. Needs More Housing Than Almost Anyone Can Imagine

[dansus021]

If the US the country that we all consider as the superpower needs more housing what about the other country, just saying.

I am not from the US but I am recently browsing about housing prices that for me and everybody else is insane is a million dollars to purchase a small apartment in New York City and there is some youtube show how much the price for monthly rent the $500 is for couple of meter damnnnn

[el kaka22]

I have to say it is not even all about "building" a house but more about how real estate became an investment for way too many people. The reality is that you could pay 20% of a house, and get the 80% with a loan and that loan will be a paid back by the renters on your home.

There are many examples where you buy a house, pay 800 per month and you rent it out for 1000 dollars per month so you make even a small profit, which means if you put it aside, that is another payment every 4 months, if one person stays for about 5 years, they pay 6-7 years of loans basically, and that's great for home owners. This resulted with people having multiple houses, and it is not about scarcity in general, it is scarcity in the market, all the house on sale gets sold very quickly for this profitable reason.

[franky1]

I have to say it is not even all about "building" a house but more about how real estate became an investment for way too many people.

its more like a select amount of people own more then a dozen properties each, all vacant and used just for investment

there is enough housing but its just that the prices went up too fast in previous years meaning they either have to correct back down fast. or stagnate for years until real value catches up

[DrBeer]

If the US the country that we all consider as the superpower needs more housing what about the other country, just saying.

I am not from the US but I am recently browsing about housing prices that for me and everybody else is insane is a million dollars to purchase a small apartment in New York City and there is some youtube show how much the price for monthly rent the $500 is for couple of meters damnnnn

Tell me - but besides New York, there are no other cities in the USA that are acceptable for life? You still look at the center of Tokyo, or Paris, or Berlin ... Or ROME .. Or Monaco? Or the Vatican... Or Zurich? You will be surprised - but there, too, real estate prices are not 10.000 dollars / euros for a cozy apartment!....
Why ? Well, because the capitals / financial centers, and it is always expensive there. But I'll tell you a secret - just don't tell anyone you can live in other cities, yeah!
Why doesn't Warsaw or Prague suit you? Beautiful European cities! Or like Helsinki? Or like Covilhã in Portugal? Or the lovely Italian cities of southern Italy? And this is just a drop in the bucket of thousands of other beautiful cities!!! And if you want to live in Manhattan in New York - save money

[franky1]

people are not paying a premium for city living due to lack of housing

there are many apartment blocks with vacant apartments.
they pay a premium to not have to commute for an hour in the morning and an hour in the evening

yes they can save themselves alot of money living outside the city. but its time thats a premium

imagine your a city worker. earning $500k a year
where of your 12 hours of awake life 2 hours of it is spent/wasted in commuting (16%)
if you can bring that down to just 30 mins (1/4th) wouldnt that be worth maybe 10% of your income
so $50k on a 20 year mortgage is $1m

broadly speaking paying ~$1m on a city home over 20 years means you get 90 minutes of spare time to relax and enjoy life

time is money and money is time

no point earning $500k if you got no spare time to enjoy it. might aswell keep $450k and enjoy 90minutes of freetime to enjoy your homelife each day

[Maximo Spohn]

Not only in the United States, but anywhere in the world when your salary does not match your local prices, you have no ability to buy a house. You may choose to take out a loan, then it will be your stress for decades to come. Some people choose to rent a house for life, while others choose to put pressure on themselves. There is no way, this is your own choice. It is possible to have a side hustle outside of your regular job. Otherwise, the rich will become richer and richer, and the money of the poor will flow to the rich.

[rokok lokal]

In my opinion, the best way to prevent a real estate crash is to provide incentives for more affordable housing in the US. This could be done through tax breaks for development, or lowering the cost of land by lowering property taxes while increasing infrastructure funding. There are also other ways, such as increasing density in large cities to create more housing units. But at the same time it's not just about building new houses and apartments, of course you also need to pay attention to the quality of these houses and apartments.

[Mauser]

Due to the exorbitant cost, alternative options like living in a tiny house or inside a vehicle like camper or van are becoming more popular mainstream options. Perhaps that is the segment of the market to invest in as it could very well be the fastest growing.

I noticed the growing number of videos on youtube over the last 12-18 months, of people living in boats, vans and tiny of grid cabins. There is a growing number of people who try to break the cycle of ever rising real estate prices, and there is also a huge demand of ordinary people to find out about these topics. These videos have millions of views from people all around the world. I think most of the western countries face the same problem like in the USA. More housing is needed because more people are singles and live alone, or in smaller families. And the housing is concentrating on a few large cities which offer the best employment option. People are not willing to commute long distances anymore and rather pay higher rent prices to live in trendy new area. The main issue I see in my country is that old houses and office buildings needs to be converted in apartments, also large apartments will be split into two smaller apartments as they can get more money for them. And this process takes many years, the whole housing situation can't be fixed within 2-3 years.

[franky1]

Due to the exorbitant cost, alternative options like living in a tiny house or inside a vehicle like camper or van are becoming more popular mainstream options. Perhaps that is the segment of the market to invest in as it could very well be the fastest growing.

I noticed the growing number of videos on youtube over the last 12-18 months, of people living in boats, vans and tiny of grid cabins. There is a growing number of people who try to break the cycle of ever rising real estate prices,

what i notice. is people see a house for $100k
take out a $130k mortgage
get the house + a 'nomad' mobile home

and then rent out their home for a premium above mortgage. so that they get their mortgage paid(by someone else(the renter)) and get some passive income from the premium

but hey if other people wanna sell their home and buy a van and then spend all that house sell income vacationing. thats on them
if i was them they should have done the smart plan. use the real estate game to get gains

[hugeblack]

I do not know, but the solution in such cases may be to have service real estate with small areas that are owned by funds managed by the state. These real estate aims for housing directly and away from speculation, while the rest of the real estate belongs to economic activities in terms of speculation and achieving a return from it.
Singapore almost succeeded in solving this problem, I had read somewhere the details of their plan.

[DaveF]

here in the UK
buying just a apartment in the mid city of london can be £1m+
yet 1 hour train commute someone can get a house of bigger liiving space for £200k

the price of the commute if done 5 days a week for 20 years is way way way way less than £200k combined. meaning a saving for £600k

yep all-in you can have a nice size countryside house with good views and quiet living and commute to work in london knowing your only 1 hour away. all for $400k on a 20year mortgage.. or pay 1 million and still be 20 minutes from workplace

You are loosing time and time = money
5 days a week x 48 weeks a year (52 weeks - vacation and holidays) = 240 days
240 days x 2 hours a day = 480 hours a year
480 hours x 20 years = 9600 hours there is a cost to that.

I am not figuring in the time it takes you to get from your house to the train station. Since from one side of a city to another also takes time.

At least here in the US living in a place like NYC also means you don't need a car for the most part. And with things like zipcar if you do need to go somewhere one is available. So you save on cost of owning a car and insurance and such.

Some people like the city, others like the country, but in the end you have to do what works for you.

... And as you said, people effectively being locked out of big cities like San Francisco and NYC isn't a new thing at all.  It's been that way since before I was born and I seriously doubt it's going to change....                                                    

Yup, I remember back in the mid 70s how people were saying that NYC is too expensive for people to live there and it's crime filled and everyone is leaving and it's going to go bankrupt and so on.

I put it into the category of when people say "It's to crowded, nobody goes there"

Fixed it- The U.S. Needs More Affordable Housing Than Almost Anyone Can Imagine.  It's more of an affordability issue than a inventory issue, esp in cities and suburbs.  The situation is so dire that folks are working 40+ hours/week and more than one job and still cannot afford.

It's also a matter of generating headlines.
Within an hour train ride of NYC housing is still expensive. Bump that up to a 90 minute train ride it really starts to drop. A lot. Like a whole lot.
But as I posted above time = money that is an extra 200+ hours a year on the train. (30 minutes extra each way = 5 hours a week = 225+ hours a year) and the longer the train ride the more expensive it is. But saying you can still be a short(ish) train ride away and have a nice place as franky1 said, does not generate the clicks on the headlines.

On the other hand salaries in NYC are way above what other places pay and finding work is easier. Case in point I have a friend of a friend who just got fired from twitter. Single no ties to be here. Got a job offer from another big tech company, could stay here in NYC and make about 5% more then he was getting at Twitter OR move to SF and make about 10% more OR move to Texas and take a 20% pay cut.

Yeah, he is staying here. With 20% cut in TX he would probably be in about the same financially possibly a bit better BUT and this is a big BUT said other tech company is the ONLY major employer for about a two hour drive. So if it does not work out he is screwed. The new job implodes here in NY there are enough other places to work. Someplace (and I really did forget the name of the town) on the TX / OK border for tech the options are a lot more limited.

-Dave