
What Happens When Housing is Cheap? - byrneseyeview
http://www.byrneseyeview.com/marketview/what_happens_when_housing_is_c.html
======
nostrademons
I was talking with my mom about this the other day, following the exact same
chain of reasoning, and came up with this:

This housing boom has left a huge number of McMansion developments that will
soon be unsellable at any price, because there are no buyers in their
demographic. The baby-boomers who built them will soon be empty-nesting and
moving to Florida condos. The Millenials that are entering the workforce now
seem to prefer city-living and have no desire to live in a 5000 square foot
monstrosity in the suburbs. The Gen-Xers who are having kids now just don't
have the numbers to fill them.

Meanwhile, firm size is decreasing, more people are working from home, and the
economy is shifting from machine-intensive manufacturing to knowledge-
intensive professional services. If YCombinator is right, the next decade will
see an increasing number of small startups, independent consultants, and
homesourcers. Many of these people are interested in coworking, because it's a
lot less lonely than spending all day at home.

So, my proposal is to buy up whole developments worth of McMansions, convince
the local government to convert the zoning to mixed-use (perhaps they could
create a new "professional" zoning category, for businesses that don't
generate much physical commercial traffic), and then rent them out en-masse to
small firms. Many of the McMansions being built today have 5 (!!) bathrooms,
one per bedroom, so it wouldn't be too complicated to split them up into
apartments with a shared kitchen & common area. People could roll out of bed
and run next door to work. We could partner with ZipCar so that transportation
would be available if yoou wanted to go to the supermarket or out for a
weekend. There'd be community events so you could bond with everyone in the
development and not just your coworkers.

This'd solve a number of problems at once. It eats up the unused housing stock
in the suburbs. It provides an alternative for young urban professionals who
don't want to live in urban areas. It builds on the coworking trend, providing
cozy office space to single professionals or small firms. With gas prices
rising, it'd cut commuting costs to nearly zero. It lowers the trouble of
finding a place to live and an office to work for all your employees, many of
whom are increasingly mobile these days. And it offers a sense of community to
people who are often either increasingly isolated (if they live/work alone) or
increasingly alienated (if they live/work in the city) these days.

Would folks go for an arrangement like this? Personally, I hate the city and
can't stand living without some greenery in my life - but I also hate having
an hour commute and no young people in my area. I'd love an arrangement where
I could walk to work and knew my neighbors. Other opinions?

------
comatose_kid
From the article: "Hypothesis: every boom, ever, leaves behind an
infrastructure for steady, above-average growth in some other industry"

Have you considered the tulip boom that happened in the Netherlands in the
1600s? I'd be curios to find out what industry that helped after it collapsed?

In any case, I doubt that this thesis holds for housing.

~~~
byrneseyeview
My guess is that it helped financial derivatives take off. I've read about
people trading puts and calls on tulips -- and then when that got boring,
trading the same instruments on commodities and stocks at more legitimate
exchanges.

But my timing could be off.

