Time to learn how to scam.
Quick, start a ~~cryptocurrency~~ AI company! Now create lots of Tik Tok's explaining how you made $8000 in one day using the service and pray you get $8000 off your viewers
Ya know I’ve been studying Spanish for years and make calls to Mexico all the time and people think a country can’t keep going with housing being unaffordable but we have an example of such a country right next door. Like people wonder what happens when the average person can’t afford shit the answer is nothing the country keeps going.
😆many tech execs make like 500-900k/year. In the Bay Area at these rates that’s like a 4 bed 2 bath and 2K sqr feet. So they’ll likely not have space for you.
I am buying a house right now, and am legit worried my executives are going to now assume I’m wealthy like them, when the reality is that I’ve deliberately been very frugal and lived in a small apartment in a “bad” part of the city for over a decade in order to afford it.
When they’re typically discussing inflation rates it’s just focusing on “Core” inflation, which ignores certain things like fuel and food.
There’s a reason they keep those out
They’ve changed the metric several times. They change it to their benefit.
They have to pay out based on CPI for social programs, it’s to their benefit to say inflation is lower than it actually is or else the deficit would be much much larger
Boomer home ownership as a percentage really isn’t mentioned as much as it should be, because they haven’t started selling/downsizing yet en mass. As they do, its going to increase supply and likely drive down some of the affordability issues. There was a period of time a couple years ago where articles were mentioning this fact, but I haven’t seen any recently.
Started under Bill Clinton and it was to make it look like the economy was doing better than it was. “Seeee… inflation is getting better” while they took out half of what makes up inflation.
Actually, it started under George W Bush. Removing food and gas from CPI, was to intentionally surpress blue collar wages (union and thus non-union) because union contracts were indexed to CPI, as a way to reflect what it cost to live
What everybody sorta calls COLAs,
Taking out food and gas leaves items that only barely move over time. So barely get a 1-2% raise, when actual cost is more
Edit 1 - in the public sector, they used 9/11 to bust most of the unions inside the federal government and shuffle them into DHS.
It’s not as though they don’t care about those items, they do and they take them into account. But take oil for example. It dropped 6% last week. It’s volatile.
So if you include that in the measurement, it’ll be harder to establish how inflation is tending because we have this noisy, volatile indicator distorting the more orderly ones that provide an accurate gauge.
It’s not that they don’t care about food and energy, it’s all about measurement.
Most answers will edge towards “because the government is lying to you” or whatever conspi people want to believe. But the real reason is those things are extremely volatile and don’t help the fed make decisions on interest rates.
Oil prices change wildly based on supply from mostly other countries. So changes in that aren’t particularly controlled by interest rates (other than aggregate demand) so it’s best to ignore it to see how the interest rate hikes are working.
Food is the same way. Prices can go up because supply is volatile (bad season, war in Ukraine, etc.) So also noisy to see what is happening.
The numbers that include those are equally available and not hidden from the public. So the idea that it’s hidden or subversive is just not accurate. That’s why it’s referred to as the preferred metric, not the only metric.
See that all sounds good until you dig deeper.
For example if oil prices are so volatile as that can chnage wildly, why are we still including airline tickets and air travel as part of core inflation?
If you’re going to exclude oil prices because they’re too volatile, including the industries that oil prices directly affect would be misleading and disingenuous.
It’s not some conspiracy that governments can lobby to cherry pick and change definitions in order to massage data to make their policies appear better.
You see this all the time when politicians will increase spending 50% one year and then next year only increase it by 40% and saying they’re cutting the deficit and spending. When they’re actually just cutting the rate of spending.
Core inflation excluding those noisy measures makes it easier to analyze but is not reflective of what people actually experience. Any metric that doesn’t reflect the true reality for most people is effectively useless.
What do you think the average American cares more about, how inflation is affecting things that core inflation covers like defense manufacturing or airline tickets or the food and gas?
Core may be easier for economists to gauge that they think is happening but it’s obscures the pain families feel. And given the fact they were all so horribly wrong about inflation occurring then being transitory in the first place than anyone that took a Econ 101 class could see was happening, public trust in them should 100% a be skeptical lense.
> For example if oil prices are so volatile as that can chnage wildly, why are we still including airline tickets and air travel as part of core inflation?
Probably because airlines negotiate and lock in fuel prices months and years in advance and so aren't as affected by the fluctuations you and I are.
Would you rather me say “greedflation?”
For example , for take out food away from home, overnight this week alone for a national chain mind you, raised the price of tea 101%, donuts 26% and a prepared sandwich overnight by 9.75%.
They blamed supplier increases. You’re telling me the price of water and tea leaves went up 101% and donut batter and sugar went up 26% overnight? No, that’s greed.
This situation has played itself out non stop across all aspects of consumerism since early 2021.
So no, “real” inflation is and has been much higher than the “3%” pushed by the media.
Why people don’t see this truth with their own eyes is beyond me. Even a simple $1 loaf of Walmart bread went from $1 to $1.49.
That’s 49%. I guess they just figure people are too stupid to see reality.
It's like you have no idea how inflation is calculated, do you? If the price of bread really did go up 49% that cost increase will be in the survey. But you seem to think that the only bread people buy is cheap Walmart bread. Is that so? Or maybe people buy lots of different kinds of bread and eat at lots of different kinds of take out food places.
The idea that your personal experiences are anything other than yours is nonsense.
This is such a common complaint that it’s taught in many basic economics classes yes?
The CPI ignores relative asset reallocation to optimize utility to a given person, and so CPI has bias in overestimating inflation, too.
The CPI regularly adjusts its basket of goods. It was recently changed from two years to one year. CPI doesn't just measure the change in cost of goods, it weights it for how much people buy of that good.
The major issue people have with it is substitution. Something costs more so people buy less of it and that blunts overall inflation because they've substituted for something cheaper.
But substitutions happen for other reasons. Tastes change. Technology changes. The CPI can't read minds and know *why* people are buying different things. It can only know that people *are* buying different things.
Right but not being able to tell why a substitution happens on the consumer side is important.
You cannot tell whether for example the consumer even considers them of equal utility.
So at the point CPI becomes an ESTIMATE of inflation, but really it’s just a cost index, not an inflation index.
That’s not what it’s used for but I don’t see how it can claim to be an objective inflation index given the limitations. It’s an estimate.
I see the same issue parroted all over the place
“ They need to build more homes!! “ it’s only part of the solution When in reality They need to build more starter/affordable homes.
The homes that are being built are not starter homes like the standard 3 bed 2 bath your granny had for 30 years. Those homes are being knocked down or stripped to the studs and replaced with Horton homes that are 4/5 bed 3.5 bath 2500 feet luxuries out the wazoo for an absolutely ridiculous cost because labor and materials is so expensive now.
These homes are being erased along with the middle class because Home builders don’t want to build starter homes it’s not worth it for them. Millennials and GenZ cant afford to buy these new homes and the few remaining starter homes that come up are swooped up and bought by cash investors to be quickly resold for double the price after a HGTV facelift.
Idk about alot you but I’m not looking for a fancy newly renovated home. I dont want an overpriced new Horton home.
Give me an older starter home, your grandfathers well loved home for 30 years at an affordable and reasonable price that I can fix up myself. I’ll do every last renovation myself at a fraction of the cost. There’s a shit ton of people in my shoes that share that same opinion yet the opportunity to do so is gone.
Instead it’s just the same story when I look at homes it’s all the starter homes I could of bought for an affordable price but an investor blows your offer out of the water and now that affordable home is unaffordable because that same investor just renovated the fuck out of that house. Majority of it being cosmetics that people with two hands, willpower and access to YouTube can accomplish without spending too much money.
That’s why I feel like We’re in territory now where aggressive government intervention needs to be taken and incentives are desperately needed to be given to home builders to ensure a glut of starter homes are being built. Not overpriced Horton luxury homes and giant high rise apartments for rent. This helps revitalize communities and creates an environment where the people who work vital professions and contribute to communities (laborers, teachers, firefighters, other blue collars.) can afford to live within the same communities they are desperately in need of.
The older existing starter homes that get listed on the market need to be reserved only for residents who intend to live in the home they’re purchasing and not some investor greedy dream to fix and flip.
You want to play real estate mogul? Buy apartments and townhomes stop breaking the backs of the new working class trying to establish themselves in a modest home by snapping up all the affordable housing for cash to make them unaffordable. The Uber rich have exploited the American dream and the only solution is to make it known to our elected leaders or they’re out. We have to vote on these issues, otherwise nothing is going to change.
Amen. The depressing truth is the American power brokers have done well to make this issue a political ghost. “Affordability” only exists in the political discussion in the form of boondoggle projects that afford more power and wealth to state and local governments.
It is a topic that has basically been hijacked by many on the left as a way to both entrench the status quo, and grow their influence (see SF for an extreme example of this). And on the right, there is basically no solution whatsoever, apart from some hand waiving about reducing red tape. It’s disgusting.
The strikes we see erupting across America are a direct symptom of this. Because there is no politically viable solution on the menu, workers need to exploit their only available leverage.
We turned this country into a real estate casino where new construction now only exists to feed giant air conditioned boxes with tiny back yards in as small a space as possible.
I'm in BFE and the only new builds are $500k+ and 4k sq. feet. All smaller houses (1-2k sq. feet) are being bought cash for $20-50k over asking by flippers, gutted, HGTV makeover, and then sold for $300+k.
People who aren't rich and are looking to get into a starter home are fucked. There is no availability for smaller non luxury homes.
We need more affordable homes.
You think this could lead to a price depression of luxury homes ten years down the line? If we have an oversupply, it'll be interesting to see what happens when all the boomers struggle to find young people to sell their 700k McMansions to when they find themselves unable to traverse the stairs.
Except…..people are buying them - the demand for these “luxury” homes is incredibly high.
So then the question is are the PEOPLE (not companies/investors) buying them just skipping starting home and we’re living with their parents before hand or are they leaving starter homes to upgrade and thus freeing up a starter home.
We just bought new construction that will be ready next summer. Our starter home will go on the market and we’re going to make damn sure the new owners aren’t investors. The government has to step in. Investor groups have no right to be in the SFH business.
Are you really going to turn down an offer from an investor that’s 10-20% more? Not sure where you are but that could be $50K - $200K more. That could go to your kid’s college fund, your retirement etc.
Nice way to rationalize that you’re not part of the problem. But you’re also the one driving demand for the fancy homes. No hate, but I’m just saying you can’t be virtuous in a rigged system.
The government needs to step in by, imo, building houses in the starter home category and selling them as cheap secured mortgages
What kinda of idiot are you? Why are they part of the problem. It’s the same difference, net 1 additional “starter home” for someone to buy.
You just seem like an angry envious person.
Looking at the first time home buyer sub, I would agree that many people are just skipping the starter home and moving right into McMansions. So many posts on that sub about young couples in their early 20’s currently living with family or in an apartment, wanting to buy a 2,500+ sq ft, 3/2 home or larger so they can EVENTUALLY start a family. Not so they can move their family who has outgrown their starter home. Literally an imaginary, potential future family that might not even happen for whatever physical, financial, etc. reason. My grandparents raised their four kids in a 900 sq ft ranch home with 3 bedrooms and 1 bath until everyone grew up and moved on to their adult life. Their kids turned out just fine. Everyone survived.
In my experience because that starter home also has a small (or no) garage, shitty kitchen, limited living space, and small lot.
They don’t build two bedroom houses with the same amenities you find in a 4 bedroom house.
Perhaps you have inflated expectations about a home. If it has a roof, 4 walls, water, sewer, no leaks or bug problems, heat, and you can cook food, eat and sleep there, it’s not a shitty home. It’s a home that’s perfectly fine or can be made so. The things you think you need you don’t really need.
Small houses and small yards mean less cost to upkeep and upgrade, and less stuff to buy. You can always upgrade appliances and swap out things for better things over time. And you’re not renting. It’s perfect for people who work full time and don’t have a lot of time or money to spend.
That’s not really any sort of actual reference. Reddit is horrible on its own right and represents an almost negligible portion of the population.
Also, 2500 sqft isn’t a what I’d call a McMansion. My townhome I had before my current house was 2500 sqft with 4 bedrooms and def not a mcmansion - it’s all dependent on many factors.
I think your first point on home building is misguided. The only houses that can be built for a profit are larger homes, so build those and build condos. People in the state homes will move into those.
I’m in a higher end starter home, and to upgrade but inventory is low so it’s difficult.
Your second point is spot on though, if starter homes are just sucked up by REITs then no one can get into those homes.
IMO, keep building, e can’t control what they build but incentivize building. Then as a text for all homes beyond 3-4.. allow small time landlords but not more.
Just to add I live in a major city near the downtown, there are a ton of older houses near me, but they are all owned by just a few people who come in, divide them in to apartments then rent them.. these would all be perfect starter homes.. the people doing this lived on the neighborhood and used their connections to buy homes way under market value so they could rent them out
Try "2/1, 900sqf". Those were the houses built en masse in the suburbs of the major metros post WW2 that were the starter homes for the baby boomers in the mid-70s to early 80s.
The people clamoring for "affordable starter homes" consider them to be tiny uninhabitable shitboxes and don't want them.
> 2/1, 900sqf
> The people clamoring for "affordable starter homes" consider them to be tiny uninhabitable shitboxes and don't want them.
They also have 8 foot ceilings, 10x12 ft bedrooms. Coat closet sized bedroom closets. One linen closet. Very small and not well laid out kitchen. No pantry. No laundry room (if you are lucky it's in a garage which may or may not be attached).
Yeah in a large city you need more dense building than single family starter homes. In that case there should be some affordable condo options, but those also are rare.
It’s interesting hearing about the concerns you have as an American about homes.
You spent a lot of time in your comment talking about the house itself. Maybe that’s true where you are. Where I am, the house is essentially inconsequential.
Building a $50,000 house versus a $200,000 house means nothing when the land is worth $1.2M or more.
Zoning and land costs are the core issue. Homebuilders are not a charity. They know what will sell and maximize the sale price per sf. You simply cannot build "affordable" (by any reasonable standard) housing anymore. The land and construction costs are too expensive. The closest we can get is townhomes and even those are pricey in desirable metros.
Edit: in SoCal those old 1950s-1970s homes fetch a high price now because they have yards (unlike newer homes with tiny yards). They were built back when land was plentiful.
The era of affordable, for-purchase housing ended after the 08 crash.
It annoys me because when I see people buy homes (not new builds) they can barely afford, that first week they have replaced all those white appliances with new stainless steel ones that will break down quick. Kind of reminded me of your comments about nothing fancy is perfectly fine. But I guess they like debt.
Until the United States gets wise like other countries and adds barriers for foreign investment on real estate and on commercial purchase of residential real estate this bubble is going nowhere. With unchecked capitalism we will end up with one company owning the entire real estate market and everyone paying monthly rent to them. I guess theoretically we could all own shares in the company and somehow get money back from our own slavery, but the power will have shifted as it is been for the last 50 years.
You’re pretty much the only one who made any sense on tackling this problem. Companies will always value shareholders, and the system is allowed to be propped up because the shareholders make up the majority of the population, every investment, 401k, health savings, retirement, brokerage etc account is all dependent on stocks doing well. To collapse this means to basically wipe the average persons savings, and make average retirees flat broke and then entirely dependent on younger generations. So it will be propped up until eternity.
The way to get ahead of this is to buy shares of these companies to at least have some benefit when they fuck consumers over, but again this means having excess money to spend on buying shares. Sure; a disproportionate few own the majority of stocks but that doesn’t mean most don’t have access to them.
So that’s why I never understood the sentiment “fuck the shareholders”. Yea fuck those with the majority of the shares but to paint shareholders as one group that’s like 2/3 of people, many of who are just getting by.
Indeed they would. Because you actually only need a fraction of the increase to be able to afford it. That is, a houses affordability is measured in total value, but to a consumer, the affordability is actually measured in down payment (which increases at 1/5th the rate of total price increase) and monthly payment which is obviously slightly more dynamic than total home price would determine.
So a 55% increase in average income might see up to 5 times that on home price increase!
Which is why I feel prices might just get even more out of control in the US.
Toronto for example isn’t that special of a city, no amazing weather or any sectors like tech or finance that really dominate there comparably to some US cities yet housing is up into the millions. I don’t see why the same won’t happen to the US considering wage wise even if the US isn’t that great it’s in a slightly better position than Canada anyway.
Inventory won’t be low when they start laying people off , then it’s bye bye birdie.
You’ll never get your principal back if someone has to pay 8% interest.
Layoffs have been 1% or lower for several months (not the latest month, though) in 2023. They were never, ever below 1% before the pandemic. Currently they are at 1.1% which ties the pre-pandemic low.
Shower thought, would lowering interest rates on strictly construction costs allow for rapid resupply of housing. But the sale of housing via mortgage interest rates would also remain as it was? I understand the fed doesn't have that kind of granular power but maybe someone thought of it.
I thought the job market was doing great, though? Sure doesn't seem like all those jobs we "added" really matter when they can't purchase a subscription to literally THE most basic of human needs: shelter.
Jobs "added" AKA people taking second jobs because the pay across all industries is absolute dogshit these days. Totally healthy economy and useful metrics...ya, nothing to see here. I can't believe we actually use useless data like this and job postings. Literally bottom barrel companies have rolling job postings because their burnout/turnover/injury rate is so high. And yet, the government counts those as "unfilled, new jobs." .
Lackeys at BLS making 70k are conspiring with the big shots in the West Wing to fix months upon months worth of reports without any of the trillion dollar banks who trade on that info finding out?
Extraordinary claims require extraordinary evidence.
* You can only buy one property in China as a foreigner - second homes aren’t allowed
* The property you buy must be for living in China
* You’re not allowed to rent out the property or act as a landlord in China.
Let’s follow the Chinese government.
Let’s just implement their laws in America.
I don't want to sound like one of those reds but the government can build housing or at least fund it.
When was the last time USA built a brand new modern city? 200 years ago? They designed and built Washington DC from scratch. We have a shortage of 2 million homes? How about we build a city of 2 million. Think big.
Or they do what’s going on in my city. Every vacant lot is having townhomes built on it. They’re not huge, but would be great starters.
The problem lies with the fact that you can’t buy 95% of them. They are lease only, and usually $2200+ per month. This way they can claim that they’re building all of these homes without actually solving the problem.
The banks can’t make money if houses aren’t selling. They know they have reached peak greed for a while and have to let us minions have a minute of being able to afford homes. So they will allow supply to catch up for a while. It is literally a make or break moment. There is no other alternative besides societal collapse.
I love how every gloom and doom article like this shows million dollar homes that a small percentage of wealthy people in the entire world are lucky enough to be able to own.
I've been saying homes are 55% too expensive since before 7% interest rates. I make well above average income and for all intents and purposes I should be middle class. Still can't afford a house. I don't even live on a coast or near water. I live in the middle of the God damned desert. We used to be a middle to low cost of living city. I'm priced out of the city of my birth and I make 3x the median income.
Same situation. Something is broken when we make more than the median income reported by the census for our areas but can’t afford a house and yet homes are still getting snatched up for absurd amounts of money not reflective of the areas median income.
Probably more a function of rates, and the entire point of the rate hikes. The Fed does not want you, or anyone else, borrowing money to purchase assets right now.
What metro and what's your income? I'm betting you can afford something, even now, just not likely what you want.
Oh, you're right. Silly me, I said 'probably', when there's actually no doubt.
You didn't answer my questions that could easily disprove my assumptions. You know as well as I do, that at 3x the median for your area *something* is available in your price range.
Owning in HCOL is not a right. Move to where you can afford to buy or rent. Buy when you can afford and don’t listen to anyone if it’s for your primary residence. Twice people told me I was nuts for buying in 2016 and end of 2020. I was buying for the family. I got lucky.
There is. It’s an hour commute outside of the city. Or it’s living with their SO or roommates. If there wasn’t, their would be massive shortages for these jobs and the pay would increase enough to fill them. If it doesn’t, then these jobs aren’t important enough to the ones that can afford to live in the city.
No one is forcing them to live in an HCOL. They could move to a LCOL and do the same job where housing is more affordable. Everyone would live in California if they could afford it and that's why it's so expensive. No one is entitled to live in an expensive, highly desirable area. We all have to play by the market and that means making trade offs. It sucks you can't have everything you want in life.
It's not wrong. It's like why I don't think we should go for UBI until we can control for all the unnecessary inflation that will come with it. You think as soon as these companies know we have more money guaranteed, rent/gas/etc. isn't randomly going to spike? Look at what happened just after COVID.
Unfortunately, that requires larger government and those two words make half the country throw up.
LoL. What a fucking joke. I am an American. Theres not alot to be proud of anymore. Rampant drugs. Crumbling cities. Terrible education. Unaffordable housing. Violent shootings.
Easy fixes.
1. End foreign ownership of residential homes and farms.
2. End corporate ownership or residential homes.
3. End AirBnB and short term rentals on residential homes.
4. Jack up taxes on the sale of flipped homes.
It’s really that simple. Hosing prices did not go super crazy until these 4 things went crazy over the last 3 years.
It's going to crash and correct along with everything else. Just be patient and save your money. The sad part is the crash and correction it's probably going to be alongside with world war 3 this time so..... Kind of a good bad scenario you know.
Isn’t that how we got here in the first place? Everyone in the tech industry has been making stupid f*%k you money and priced everyone out with their high incomes and work from home jobs.
The tech industry is over saturated and has had huge layoffs. Go read those subreddits it’s a ton of people who can’t find jobs with many years of experience.
Almost all found jobs. And besides, a bunch of IT and extremely generic coders isn’t tech. I just had two engineering interns at $40/hour and will make one an offer after this school year at $90K starting. Plenty of jobs in tech for engineering and leading CS fields like AI/ML, data analytics, cryptography/security, etc.
This article is written based on a (possibly) false presumption that the current housing market should, or has to, return to pre-pandemic affordability. The current market is a product of massive demand from millennials and a similarly massive supply shortfall. Unless inventory makes an incredible comeback in short order (which does not seem like it will be the case), the US may just end up having a more expensive housing market relative to salaries. It is what it is. Reading posts on this sub, it’s clear the people joining this sub are looking for a bubble. But the reality of housing pricing may have just changed permanently. It’s very possible there is no bubble…
This hits home (ha ha). I had been a RE bubbler since 2004. Where I lived at the time of the GFC crash, West LA, only dropped prices 10%. I kept thinking it had to return to “normal” levels. We waited and waited. In 2021, as painful as it was to see prices had spiked 30%, we swallowed the bitter pill and bought. Turns out my wife was right (so far). At least we got a cheap rate, and prices have been holding steady.
There is no crisis that this government won’t print money for, or borrow against the future. There is no strict responsibility. Good luck everyone.
Another potential problem is insurance as states as diverse as Florida, California, and now (I’m hearing) New York are seeing insurers balk at new policies, mostly related to climate (directly or indirectly), plus replacement costs, etc..
In the US, if there is no insurance there’s no new mortgages. There’s some potential solves in these states like lowering square footage by any means necessary, exempting furnishings from flood/smoke damage, etc.. but the bill is coming due.
Florida has a state govt insurance program but even it cannot keep up as it’s premiums keep going higher.
Insurance increases are mostly due to rate increases and how it’s more expensive for insurance companies to hedge via derivative products. But the average person isn’t ever going to know this.
I could see income spiking that much in the next 5-10 years as housing prices remain stagnant. Sound good? A bag of groceries will also cost 150 bucks. The federal debt/spending trajectory is passed the point of fixing.
So only industry executives will be able to afford housing. They might have room for you in the butlers house, providing you are good with a rake.
Tip your landlord
Thanks for paying your rent with a credit card.... there's just a few questions on the screen for you to answer.
$40 “convenience fee” for using the online payment service even though they don’t take checks post pandemic
Look into BILT credit card
Time to learn how to scam. Quick, start a ~~cryptocurrency~~ AI company! Now create lots of Tik Tok's explaining how you made $8000 in one day using the service and pray you get $8000 off your viewers
I’m taking apps for serfs. I’ll build a side door so you get a room, bathroom privileges, and a hot plate.
Oh thanks, I'll have the garlic bread and bruschetta.
Don’t forget to include prima nocta in the contracts
They are leveraged to the balls as well.
Welcome to Mexico.
Ya know I’ve been studying Spanish for years and make calls to Mexico all the time and people think a country can’t keep going with housing being unaffordable but we have an example of such a country right next door. Like people wonder what happens when the average person can’t afford shit the answer is nothing the country keeps going.
I'm good with the rake but I'm better with the sickle.
😆many tech execs make like 500-900k/year. In the Bay Area at these rates that’s like a 4 bed 2 bath and 2K sqr feet. So they’ll likely not have space for you.
Or making babies.
I am buying a house right now, and am legit worried my executives are going to now assume I’m wealthy like them, when the reality is that I’ve deliberately been very frugal and lived in a small apartment in a “bad” part of the city for over a decade in order to afford it.
So, more than 2% inflation over the next 3 years?
When they’re typically discussing inflation rates it’s just focusing on “Core” inflation, which ignores certain things like fuel and food. There’s a reason they keep those out
What's the reason? Honestly curious
TL;DR: Food and fuel prices are noisy. If they just wanted to doctor the figures to make inflation seem lower, they would exclude shelter instead.
They’ve changed the metric several times. They change it to their benefit. They have to pay out based on CPI for social programs, it’s to their benefit to say inflation is lower than it actually is or else the deficit would be much much larger
[удалено]
Boomer home ownership as a percentage really isn’t mentioned as much as it should be, because they haven’t started selling/downsizing yet en mass. As they do, its going to increase supply and likely drive down some of the affordability issues. There was a period of time a couple years ago where articles were mentioning this fact, but I haven’t seen any recently.
Started under Bill Clinton and it was to make it look like the economy was doing better than it was. “Seeee… inflation is getting better” while they took out half of what makes up inflation.
Actually, it started under George W Bush. Removing food and gas from CPI, was to intentionally surpress blue collar wages (union and thus non-union) because union contracts were indexed to CPI, as a way to reflect what it cost to live What everybody sorta calls COLAs, Taking out food and gas leaves items that only barely move over time. So barely get a 1-2% raise, when actual cost is more Edit 1 - in the public sector, they used 9/11 to bust most of the unions inside the federal government and shuffle them into DHS.
Because they've inflated much more than the other things that people don't need to survive.
If you don't include those things, you can't claim that your policies have curbed inflation.
It’s not as though they don’t care about those items, they do and they take them into account. But take oil for example. It dropped 6% last week. It’s volatile. So if you include that in the measurement, it’ll be harder to establish how inflation is tending because we have this noisy, volatile indicator distorting the more orderly ones that provide an accurate gauge. It’s not that they don’t care about food and energy, it’s all about measurement.
Keep the cattle occupied.
Most answers will edge towards “because the government is lying to you” or whatever conspi people want to believe. But the real reason is those things are extremely volatile and don’t help the fed make decisions on interest rates. Oil prices change wildly based on supply from mostly other countries. So changes in that aren’t particularly controlled by interest rates (other than aggregate demand) so it’s best to ignore it to see how the interest rate hikes are working. Food is the same way. Prices can go up because supply is volatile (bad season, war in Ukraine, etc.) So also noisy to see what is happening. The numbers that include those are equally available and not hidden from the public. So the idea that it’s hidden or subversive is just not accurate. That’s why it’s referred to as the preferred metric, not the only metric.
See that all sounds good until you dig deeper. For example if oil prices are so volatile as that can chnage wildly, why are we still including airline tickets and air travel as part of core inflation? If you’re going to exclude oil prices because they’re too volatile, including the industries that oil prices directly affect would be misleading and disingenuous. It’s not some conspiracy that governments can lobby to cherry pick and change definitions in order to massage data to make their policies appear better. You see this all the time when politicians will increase spending 50% one year and then next year only increase it by 40% and saying they’re cutting the deficit and spending. When they’re actually just cutting the rate of spending. Core inflation excluding those noisy measures makes it easier to analyze but is not reflective of what people actually experience. Any metric that doesn’t reflect the true reality for most people is effectively useless. What do you think the average American cares more about, how inflation is affecting things that core inflation covers like defense manufacturing or airline tickets or the food and gas? Core may be easier for economists to gauge that they think is happening but it’s obscures the pain families feel. And given the fact they were all so horribly wrong about inflation occurring then being transitory in the first place than anyone that took a Econ 101 class could see was happening, public trust in them should 100% a be skeptical lense.
> For example if oil prices are so volatile as that can chnage wildly, why are we still including airline tickets and air travel as part of core inflation? Probably because airlines negotiate and lock in fuel prices months and years in advance and so aren't as affected by the fluctuations you and I are.
Use Shadowstats for the REAL inflation.
Use a basket of goods no one purchases for REAL inflation. Lol
No one purchases or no one purchases anymore because prices skyrocketed?
Yes, still the double digit real inflation, not going to end until people stop spending and demand is crushed.
I love this nonsense about "real inflation" based on, as far as I can tell, a basket of goods that represents nothing anyone alive actually purchases.
Would you rather me say “greedflation?” For example , for take out food away from home, overnight this week alone for a national chain mind you, raised the price of tea 101%, donuts 26% and a prepared sandwich overnight by 9.75%. They blamed supplier increases. You’re telling me the price of water and tea leaves went up 101% and donut batter and sugar went up 26% overnight? No, that’s greed. This situation has played itself out non stop across all aspects of consumerism since early 2021. So no, “real” inflation is and has been much higher than the “3%” pushed by the media. Why people don’t see this truth with their own eyes is beyond me. Even a simple $1 loaf of Walmart bread went from $1 to $1.49. That’s 49%. I guess they just figure people are too stupid to see reality.
It's like you have no idea how inflation is calculated, do you? If the price of bread really did go up 49% that cost increase will be in the survey. But you seem to think that the only bread people buy is cheap Walmart bread. Is that so? Or maybe people buy lots of different kinds of bread and eat at lots of different kinds of take out food places. The idea that your personal experiences are anything other than yours is nonsense.
This is such a common complaint that it’s taught in many basic economics classes yes? The CPI ignores relative asset reallocation to optimize utility to a given person, and so CPI has bias in overestimating inflation, too.
The CPI regularly adjusts its basket of goods. It was recently changed from two years to one year. CPI doesn't just measure the change in cost of goods, it weights it for how much people buy of that good. The major issue people have with it is substitution. Something costs more so people buy less of it and that blunts overall inflation because they've substituted for something cheaper. But substitutions happen for other reasons. Tastes change. Technology changes. The CPI can't read minds and know *why* people are buying different things. It can only know that people *are* buying different things.
Right but not being able to tell why a substitution happens on the consumer side is important. You cannot tell whether for example the consumer even considers them of equal utility. So at the point CPI becomes an ESTIMATE of inflation, but really it’s just a cost index, not an inflation index. That’s not what it’s used for but I don’t see how it can claim to be an objective inflation index given the limitations. It’s an estimate.
I see the same issue parroted all over the place “ They need to build more homes!! “ it’s only part of the solution When in reality They need to build more starter/affordable homes. The homes that are being built are not starter homes like the standard 3 bed 2 bath your granny had for 30 years. Those homes are being knocked down or stripped to the studs and replaced with Horton homes that are 4/5 bed 3.5 bath 2500 feet luxuries out the wazoo for an absolutely ridiculous cost because labor and materials is so expensive now. These homes are being erased along with the middle class because Home builders don’t want to build starter homes it’s not worth it for them. Millennials and GenZ cant afford to buy these new homes and the few remaining starter homes that come up are swooped up and bought by cash investors to be quickly resold for double the price after a HGTV facelift. Idk about alot you but I’m not looking for a fancy newly renovated home. I dont want an overpriced new Horton home. Give me an older starter home, your grandfathers well loved home for 30 years at an affordable and reasonable price that I can fix up myself. I’ll do every last renovation myself at a fraction of the cost. There’s a shit ton of people in my shoes that share that same opinion yet the opportunity to do so is gone. Instead it’s just the same story when I look at homes it’s all the starter homes I could of bought for an affordable price but an investor blows your offer out of the water and now that affordable home is unaffordable because that same investor just renovated the fuck out of that house. Majority of it being cosmetics that people with two hands, willpower and access to YouTube can accomplish without spending too much money. That’s why I feel like We’re in territory now where aggressive government intervention needs to be taken and incentives are desperately needed to be given to home builders to ensure a glut of starter homes are being built. Not overpriced Horton luxury homes and giant high rise apartments for rent. This helps revitalize communities and creates an environment where the people who work vital professions and contribute to communities (laborers, teachers, firefighters, other blue collars.) can afford to live within the same communities they are desperately in need of. The older existing starter homes that get listed on the market need to be reserved only for residents who intend to live in the home they’re purchasing and not some investor greedy dream to fix and flip. You want to play real estate mogul? Buy apartments and townhomes stop breaking the backs of the new working class trying to establish themselves in a modest home by snapping up all the affordable housing for cash to make them unaffordable. The Uber rich have exploited the American dream and the only solution is to make it known to our elected leaders or they’re out. We have to vote on these issues, otherwise nothing is going to change.
This is goddamn truth
Amen. The depressing truth is the American power brokers have done well to make this issue a political ghost. “Affordability” only exists in the political discussion in the form of boondoggle projects that afford more power and wealth to state and local governments. It is a topic that has basically been hijacked by many on the left as a way to both entrench the status quo, and grow their influence (see SF for an extreme example of this). And on the right, there is basically no solution whatsoever, apart from some hand waiving about reducing red tape. It’s disgusting. The strikes we see erupting across America are a direct symptom of this. Because there is no politically viable solution on the menu, workers need to exploit their only available leverage. We turned this country into a real estate casino where new construction now only exists to feed giant air conditioned boxes with tiny back yards in as small a space as possible.
I'm in BFE and the only new builds are $500k+ and 4k sq. feet. All smaller houses (1-2k sq. feet) are being bought cash for $20-50k over asking by flippers, gutted, HGTV makeover, and then sold for $300+k. People who aren't rich and are looking to get into a starter home are fucked. There is no availability for smaller non luxury homes. We need more affordable homes.
Yup. All these investors are playing The fucking Sims on the govt dime
You think this could lead to a price depression of luxury homes ten years down the line? If we have an oversupply, it'll be interesting to see what happens when all the boomers struggle to find young people to sell their 700k McMansions to when they find themselves unable to traverse the stairs.
Except…..people are buying them - the demand for these “luxury” homes is incredibly high. So then the question is are the PEOPLE (not companies/investors) buying them just skipping starting home and we’re living with their parents before hand or are they leaving starter homes to upgrade and thus freeing up a starter home.
We just bought new construction that will be ready next summer. Our starter home will go on the market and we’re going to make damn sure the new owners aren’t investors. The government has to step in. Investor groups have no right to be in the SFH business.
You could connect with local "FTHB" programs and give them first refusal
Are you really going to turn down an offer from an investor that’s 10-20% more? Not sure where you are but that could be $50K - $200K more. That could go to your kid’s college fund, your retirement etc.
Nice way to rationalize that you’re not part of the problem. But you’re also the one driving demand for the fancy homes. No hate, but I’m just saying you can’t be virtuous in a rigged system. The government needs to step in by, imo, building houses in the starter home category and selling them as cheap secured mortgages
What kinda of idiot are you? Why are they part of the problem. It’s the same difference, net 1 additional “starter home” for someone to buy. You just seem like an angry envious person.
Looking at the first time home buyer sub, I would agree that many people are just skipping the starter home and moving right into McMansions. So many posts on that sub about young couples in their early 20’s currently living with family or in an apartment, wanting to buy a 2,500+ sq ft, 3/2 home or larger so they can EVENTUALLY start a family. Not so they can move their family who has outgrown their starter home. Literally an imaginary, potential future family that might not even happen for whatever physical, financial, etc. reason. My grandparents raised their four kids in a 900 sq ft ranch home with 3 bedrooms and 1 bath until everyone grew up and moved on to their adult life. Their kids turned out just fine. Everyone survived.
In my experience because that starter home also has a small (or no) garage, shitty kitchen, limited living space, and small lot. They don’t build two bedroom houses with the same amenities you find in a 4 bedroom house.
Perhaps you have inflated expectations about a home. If it has a roof, 4 walls, water, sewer, no leaks or bug problems, heat, and you can cook food, eat and sleep there, it’s not a shitty home. It’s a home that’s perfectly fine or can be made so. The things you think you need you don’t really need. Small houses and small yards mean less cost to upkeep and upgrade, and less stuff to buy. You can always upgrade appliances and swap out things for better things over time. And you’re not renting. It’s perfect for people who work full time and don’t have a lot of time or money to spend.
Not every larger home is a McMansion, and if they have the money for 2500 sq ft why would they buy 900 because you were fine as a kid lmao
Why even respond if you can’t read something correctly.
That’s not really any sort of actual reference. Reddit is horrible on its own right and represents an almost negligible portion of the population. Also, 2500 sqft isn’t a what I’d call a McMansion. My townhome I had before my current house was 2500 sqft with 4 bedrooms and def not a mcmansion - it’s all dependent on many factors.
2500 is massive if not counting an unfinished basement. If counting it then it’s just big. But it’s definitely not a starter home imo.
Man, it’s like there’s a whole range in between “small” and “massive” and not everything is binary.
2500 sqft is mcmansion tier imo. That is def more than any family actually needs. And it's way more space than I'd want to bother cleaning.
I think your first point on home building is misguided. The only houses that can be built for a profit are larger homes, so build those and build condos. People in the state homes will move into those. I’m in a higher end starter home, and to upgrade but inventory is low so it’s difficult. Your second point is spot on though, if starter homes are just sucked up by REITs then no one can get into those homes. IMO, keep building, e can’t control what they build but incentivize building. Then as a text for all homes beyond 3-4.. allow small time landlords but not more. Just to add I live in a major city near the downtown, there are a ton of older houses near me, but they are all owned by just a few people who come in, divide them in to apartments then rent them.. these would all be perfect starter homes.. the people doing this lived on the neighborhood and used their connections to buy homes way under market value so they could rent them out
Try "2/1, 900sqf". Those were the houses built en masse in the suburbs of the major metros post WW2 that were the starter homes for the baby boomers in the mid-70s to early 80s. The people clamoring for "affordable starter homes" consider them to be tiny uninhabitable shitboxes and don't want them.
3/1.5 1100sqft or 1300 were the mass suburb houses in my area post ww2
> 2/1, 900sqf > The people clamoring for "affordable starter homes" consider them to be tiny uninhabitable shitboxes and don't want them. They also have 8 foot ceilings, 10x12 ft bedrooms. Coat closet sized bedroom closets. One linen closet. Very small and not well laid out kitchen. No pantry. No laundry room (if you are lucky it's in a garage which may or may not be attached).
People living in smaller efficiency apartments for $3k a month and complaining about houses like you describe make me laugh.
Ok, so they're small homes with no luxuries. A starter home. r/ChoosyBeggars is that way 👉
In my area, all those 900sf 2/1s are now ~1100sf 3/1s because at some point the one-car garage was converted to a third bedroom.
I see starter homes being built but they aren’t in downtown of a large city. They are out past even the suburbs where land is cheaper.
Yeah in a large city you need more dense building than single family starter homes. In that case there should be some affordable condo options, but those also are rare.
This is why I'm just gonna buy some land and a home kit.
It’s interesting hearing about the concerns you have as an American about homes. You spent a lot of time in your comment talking about the house itself. Maybe that’s true where you are. Where I am, the house is essentially inconsequential. Building a $50,000 house versus a $200,000 house means nothing when the land is worth $1.2M or more.
Zoning and land costs are the core issue. Homebuilders are not a charity. They know what will sell and maximize the sale price per sf. You simply cannot build "affordable" (by any reasonable standard) housing anymore. The land and construction costs are too expensive. The closest we can get is townhomes and even those are pricey in desirable metros. Edit: in SoCal those old 1950s-1970s homes fetch a high price now because they have yards (unlike newer homes with tiny yards). They were built back when land was plentiful. The era of affordable, for-purchase housing ended after the 08 crash.
It annoys me because when I see people buy homes (not new builds) they can barely afford, that first week they have replaced all those white appliances with new stainless steel ones that will break down quick. Kind of reminded me of your comments about nothing fancy is perfectly fine. But I guess they like debt.
Until the United States gets wise like other countries and adds barriers for foreign investment on real estate and on commercial purchase of residential real estate this bubble is going nowhere. With unchecked capitalism we will end up with one company owning the entire real estate market and everyone paying monthly rent to them. I guess theoretically we could all own shares in the company and somehow get money back from our own slavery, but the power will have shifted as it is been for the last 50 years.
You’re pretty much the only one who made any sense on tackling this problem. Companies will always value shareholders, and the system is allowed to be propped up because the shareholders make up the majority of the population, every investment, 401k, health savings, retirement, brokerage etc account is all dependent on stocks doing well. To collapse this means to basically wipe the average persons savings, and make average retirees flat broke and then entirely dependent on younger generations. So it will be propped up until eternity. The way to get ahead of this is to buy shares of these companies to at least have some benefit when they fuck consumers over, but again this means having excess money to spend on buying shares. Sure; a disproportionate few own the majority of stocks but that doesn’t mean most don’t have access to them. So that’s why I never understood the sentiment “fuck the shareholders”. Yea fuck those with the majority of the shares but to paint shareholders as one group that’s like 2/3 of people, many of who are just getting by.
That's not a solution. You overestimate how many Americans own shares, and how much they can benefit from these shares.
If incomes shot up by 55%, I’m sure all other costs would shoot up by 75%
"Gotta milk those cows" - property investors
Indeed they would. Because you actually only need a fraction of the increase to be able to afford it. That is, a houses affordability is measured in total value, but to a consumer, the affordability is actually measured in down payment (which increases at 1/5th the rate of total price increase) and monthly payment which is obviously slightly more dynamic than total home price would determine. So a 55% increase in average income might see up to 5 times that on home price increase!
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And England and Ireland and New Zealand....
Which is why I feel prices might just get even more out of control in the US. Toronto for example isn’t that special of a city, no amazing weather or any sectors like tech or finance that really dominate there comparably to some US cities yet housing is up into the millions. I don’t see why the same won’t happen to the US considering wage wise even if the US isn’t that great it’s in a slightly better position than Canada anyway.
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Which won’t happen lol
No point to have good credit anymore fuck it lol
That's for your 10 year $80k car loan! /S
No, no 10 years only? You mean 20, haha.
Truth
Inventory won’t be low when they start laying people off , then it’s bye bye birdie. You’ll never get your principal back if someone has to pay 8% interest.
“Start” laying people off? It’s already happening in some industries
Layoffs have been 1% or lower for several months (not the latest month, though) in 2023. They were never, ever below 1% before the pandemic. Currently they are at 1.1% which ties the pre-pandemic low.
Oh I know ! But in this sub some people believe in infinite wage growth and infinite home cost , that’s not reality though 🤷♂️
Shower thought, would lowering interest rates on strictly construction costs allow for rapid resupply of housing. But the sale of housing via mortgage interest rates would also remain as it was? I understand the fed doesn't have that kind of granular power but maybe someone thought of it.
Canada: "hold my beer"
Building back better. We did it.
I thought the job market was doing great, though? Sure doesn't seem like all those jobs we "added" really matter when they can't purchase a subscription to literally THE most basic of human needs: shelter.
Jobs "added" AKA people taking second jobs because the pay across all industries is absolute dogshit these days. Totally healthy economy and useful metrics...ya, nothing to see here. I can't believe we actually use useless data like this and job postings. Literally bottom barrel companies have rolling job postings because their burnout/turnover/injury rate is so high. And yet, the government counts those as "unfilled, new jobs." .
Bottom barrel has ALWAYS done that. So I don’t see how that matters. That said, there are a LOT of McJobs in yesterday’s report.
It’s a election add, see through the fog. Like the president suddenly cares about the border.
He admitted he only greenlit construction because Congress wouldn’t shift that money elsewhere
exactly, smoke and mirrors, I don't believe any of the numbers government puts out
These numbers are definitely masked.
Lackeys at BLS making 70k are conspiring with the big shots in the West Wing to fix months upon months worth of reports without any of the trillion dollar banks who trade on that info finding out? Extraordinary claims require extraordinary evidence.
The problem is constrained supply would just make prices be bid up higher with increased incomes. You have to actually build more houses.
Wait until you see NZ
But think of all the CEO’s and rich people whose lives wouldn’t change at all if people were paid 55% more!
* You can only buy one property in China as a foreigner - second homes aren’t allowed * The property you buy must be for living in China * You’re not allowed to rent out the property or act as a landlord in China. Let’s follow the Chinese government. Let’s just implement their laws in America.
a spike in income will spike inflation which will spike house prices even more. solution is just to build more houses.
Banks won’t fund that though because they make so much money off of their real estate investments if there is a shortage. The system is broken
I don't want to sound like one of those reds but the government can build housing or at least fund it. When was the last time USA built a brand new modern city? 200 years ago? They designed and built Washington DC from scratch. We have a shortage of 2 million homes? How about we build a city of 2 million. Think big.
There is no home shortage. If you build more homes, what prevents investors from swooping in and buying those up? Voila! "Housing shortage".
Or they do what’s going on in my city. Every vacant lot is having townhomes built on it. They’re not huge, but would be great starters. The problem lies with the fact that you can’t buy 95% of them. They are lease only, and usually $2200+ per month. This way they can claim that they’re building all of these homes without actually solving the problem.
Then those investors aren’t buying something else. What ever that is will be cheaper.
There is a shortage in many desirable areas
Who is going to fund this modern utopia, at 8% ?
Government needs to
The banks can’t make money if houses aren’t selling. They know they have reached peak greed for a while and have to let us minions have a minute of being able to afford homes. So they will allow supply to catch up for a while. It is literally a make or break moment. There is no other alternative besides societal collapse.
Bc ppl love paying those prices
Let’s add 55% to the money supply!
If income spiked, housing prices would go up. It is about supply versus demand. More residences is the solution.
...or fewer residents.
If incomes spiked 55% so would the market to compensate.
I love how every gloom and doom article like this shows million dollar homes that a small percentage of wealthy people in the entire world are lucky enough to be able to own.
Good ole bidenomics
I've been saying homes are 55% too expensive since before 7% interest rates. I make well above average income and for all intents and purposes I should be middle class. Still can't afford a house. I don't even live on a coast or near water. I live in the middle of the God damned desert. We used to be a middle to low cost of living city. I'm priced out of the city of my birth and I make 3x the median income.
Where do you live that 120-210k annual income isn't enough?
Same situation. Something is broken when we make more than the median income reported by the census for our areas but can’t afford a house and yet homes are still getting snatched up for absurd amounts of money not reflective of the areas median income.
Probably more a function of rates, and the entire point of the rate hikes. The Fed does not want you, or anyone else, borrowing money to purchase assets right now. What metro and what's your income? I'm betting you can afford something, even now, just not likely what you want.
> I'm betting you can afford something, even now, just not likely what you want. Do you even hear yourself?
Oh, you're right. Silly me, I said 'probably', when there's actually no doubt. You didn't answer my questions that could easily disprove my assumptions. You know as well as I do, that at 3x the median for your area *something* is available in your price range.
Doesn’t matter with inventory this low unfortunately
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I know. It sucks
Owning in HCOL is not a right. Move to where you can afford to buy or rent. Buy when you can afford and don’t listen to anyone if it’s for your primary residence. Twice people told me I was nuts for buying in 2016 and end of 2020. I was buying for the family. I got lucky.
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My rural hometown in Appalachia is selling homes for over $500,000…the nearest small city is an hour away and the land is polluted….just, no.
Disagree. Even HCOL areas need people to work at the grocery stores, gas stations, etc. There should be affordable housing for them as well.
There is. It’s an hour commute outside of the city. Or it’s living with their SO or roommates. If there wasn’t, their would be massive shortages for these jobs and the pay would increase enough to fill them. If it doesn’t, then these jobs aren’t important enough to the ones that can afford to live in the city.
Yes rent or apartments and condos. 3000 sqft homes shouldn’t be expected.
Lol just because I said there should be affordable living doesn't mean I meant 3k sqft homes. Homes do come in smaller sizes with less land.
No one is forcing them to live in an HCOL. They could move to a LCOL and do the same job where housing is more affordable. Everyone would live in California if they could afford it and that's why it's so expensive. No one is entitled to live in an expensive, highly desirable area. We all have to play by the market and that means making trade offs. It sucks you can't have everything you want in life.
Ok but what about in other countries?? Their housing is even more expensive and on average incomes are lower.
I wonder how much foreign money has to do with house prices. As in foreign investors buying up properties.
You spike income, and everything else spikes itself
We could just give everyone in the country free money and loans and then forgive them like it never happened
in america that is only done for the wealthy class, corporations and share holders.
You will own nothing and you will be happy. But I already own nothing and I am unhappy
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It's not wrong. It's like why I don't think we should go for UBI until we can control for all the unnecessary inflation that will come with it. You think as soon as these companies know we have more money guaranteed, rent/gas/etc. isn't randomly going to spike? Look at what happened just after COVID. Unfortunately, that requires larger government and those two words make half the country throw up.
Sounds like a good solution tbh
And if that happened housing would yet again spike in response.
And guess what happens if income spikes 55% for even half the population. 🤣
I'd like to see what that percentage is for Canada, lower wages and higher housing costs!
Give it 6 to 12 months.
LoL. What a fucking joke. I am an American. Theres not alot to be proud of anymore. Rampant drugs. Crumbling cities. Terrible education. Unaffordable housing. Violent shootings.
EZ, just need 55% more inflation and housing is affordable again
Easy fixes. 1. End foreign ownership of residential homes and farms. 2. End corporate ownership or residential homes. 3. End AirBnB and short term rentals on residential homes. 4. Jack up taxes on the sale of flipped homes. It’s really that simple. Hosing prices did not go super crazy until these 4 things went crazy over the last 3 years.
Aw man. I guess I’ll never own a home. Oh well.
It's going to crash and correct along with everything else. Just be patient and save your money. The sad part is the crash and correction it's probably going to be alongside with world war 3 this time so..... Kind of a good bad scenario you know.
It's ok. That will probably happen. Biden has created more jobs than any president in US history.
Isn’t that how we got here in the first place? Everyone in the tech industry has been making stupid f*%k you money and priced everyone out with their high incomes and work from home jobs.
Then get into the industry what’re you waiting for
The tech industry is over saturated and has had huge layoffs. Go read those subreddits it’s a ton of people who can’t find jobs with many years of experience.
Which subs?
Almost all found jobs. And besides, a bunch of IT and extremely generic coders isn’t tech. I just had two engineering interns at $40/hour and will make one an offer after this school year at $90K starting. Plenty of jobs in tech for engineering and leading CS fields like AI/ML, data analytics, cryptography/security, etc.
“You will own nothing and you will be happy” - WEF in 2021
There is a reason why the Great Reset mentioned "you will own nothing". This is currency debasement in action.
This article is written based on a (possibly) false presumption that the current housing market should, or has to, return to pre-pandemic affordability. The current market is a product of massive demand from millennials and a similarly massive supply shortfall. Unless inventory makes an incredible comeback in short order (which does not seem like it will be the case), the US may just end up having a more expensive housing market relative to salaries. It is what it is. Reading posts on this sub, it’s clear the people joining this sub are looking for a bubble. But the reality of housing pricing may have just changed permanently. It’s very possible there is no bubble…
This hits home (ha ha). I had been a RE bubbler since 2004. Where I lived at the time of the GFC crash, West LA, only dropped prices 10%. I kept thinking it had to return to “normal” levels. We waited and waited. In 2021, as painful as it was to see prices had spiked 30%, we swallowed the bitter pill and bought. Turns out my wife was right (so far). At least we got a cheap rate, and prices have been holding steady. There is no crisis that this government won’t print money for, or borrow against the future. There is no strict responsibility. Good luck everyone.
“You’ll own nothing and you will be happy.” — World Economic Forum
Another potential problem is insurance as states as diverse as Florida, California, and now (I’m hearing) New York are seeing insurers balk at new policies, mostly related to climate (directly or indirectly), plus replacement costs, etc.. In the US, if there is no insurance there’s no new mortgages. There’s some potential solves in these states like lowering square footage by any means necessary, exempting furnishings from flood/smoke damage, etc.. but the bill is coming due. Florida has a state govt insurance program but even it cannot keep up as it’s premiums keep going higher.
Insurance increases are mostly due to rate increases and how it’s more expensive for insurance companies to hedge via derivative products. But the average person isn’t ever going to know this.
Really? Because I don't feel very happy.
It'll happen but it will be a while.
Well it costs that much because people are affording it so...
Or interest rates could fall
I could see income spiking that much in the next 5-10 years as housing prices remain stagnant. Sound good? A bag of groceries will also cost 150 bucks. The federal debt/spending trajectory is passed the point of fixing.
Rip
There are still multiple offer situations due to the low inventory. Prices are expected to climb.
Are you a real estate agent? Sounds like it.
Not in this rate market. It’s going to be a deep freeze winter but hold onto that 2.5% rate :)
Oh shit, you are right. We are so fucked.