
Zoom towns and the new housing market for the two Americas - jelliclesfarm
https://www.npr.org/sections/money/2020/09/08/909680016/zoom-towns-and-the-new-housing-market-for-the-2-americas
======
Merrill
The disassociation of how you make your living and where you live will have
interesting long-term social consequences.

Until recently, most people have had to live where they made their living.
Farmers lived on farms. Workers lived near mines, mills, factories and offices
in which they worked. Even rich people lived in the cities where their
businesses and investments were located, at least until the late 1800s when
rail commuting to nearby suburbs allowed them to live in more pleasant
surroundings. Even so, the wealthy continued to identify with their cities,
participated in civic life, indulged in philanthropy, and were reasonably
concerned about their city's quality of life.

In the 1960s, jet travel became cheap and frequent for the wealthy. The really
rich became detached from the cities and moved to enclaves of wealth in
Newport, Carmel, Palm Springs, Palm Beach, etc. from which they could reach
cities occasionally, but from which they could safely ignore urban problems.
The urban cores declined, in part, because the wealthy no longer cared.

Information technology enables a whole new slice of the population to detach
where they live from where they make their living. Their political and social
interests will shift to where they live, and they will abandon where they make
their living.

~~~
claydavisss
For almost all of human history, people have "worked from home". The workplace
as a distinct separate space from the home is only about a couple of centuries
old.

------
zachware
This will all depend what % of employers stay with their current remote
structure. It’ll be somewhere between 1% of 80/90%.

The point is that we’re making long-term decisions based on short-term
problems. Specifically this week JP Morgan asked its traders to return to the
office.

You can counter this with examples like Facebook opening an office in Austin
some years ago because that’s where the talent had moved. Similar in Boulder.

There will certainly be some % of employers who keep remote-first. And another
scenario where they are forced to or the employees decide they love their
lifestyle (which is likely). In the latter employers are either forced to
adopt it or or the employees just leave or in some concentrations big
companies start building offices in a distributed way.

We’re severely limiting our job choices if we stay remote but most employers
don’t.

Before when we go off and buy houses or sign long-term leases we should really
just wait this out until the Spring or whenever the virus is neutralized.

~~~
xivzgrev
exactly this. i'm pretty surprised at the number of people buying homes in far
out locations, like this "new normal" is going to be the "new normal" ongoing.
I don't buy it (yet). There are a few companies that have bought in, and if
you work there then at least you're set for a bit. But people only stay at a
tech job for a few years typically - what happens when you want to switch
companies?

~~~
cactus2093
It's certainly possible that people have taken a liking to remote work and
decided it's the right move for themselves. Whether in 5 years remote work is
much more prevalent than it was in Feb 2020 or about the same doesn't
necessarily affect your own individual decision making.

~~~
shajznnckfke
If you’re used to receiving BigCo pay and bought a mansion in a remote
vacation hotspot, you could be in for a rude awakening if you find other
remote jobs pay half as much and your employer knows that and stops giving you
refreshes.

~~~
wtracy
This.

The FAANG crowd is used to pulling down $100k-$150k. Developer jobs that are
advertised as remote from day one tend to be closer to $50k-$70k.

(These numbers are based on a combination of rumors and job board postings, so
no, I don't have a source to cite.)

~~~
rabidrat
Erm, in my experience (20 years, good but not a superstar) the numbers are 2x
that. My last BigCo offer was $300k total comp and jobs with smaller companies
(all remote) were around $120-150k. One startup offered me $190k to work
remote (but I would have been the only remote worker).

That said, I agree that your average non-FAANG job pays about half of FAANG.
Although this is true regardless of remote-ness.

~~~
tolbish
You are getting those offers because of your 20 years of experience, not
because remote work is inherently lucrative. Most people with 10 or fewer
years of experience are used to seeing remote-only offers of less than $100k.

~~~
_t0du
I have less than 20 years experience (less than 10 even) and I have
gotten/seen a bunch of offers/jobs/etc with remote-only or remote-first over
100k

~~~
tolbish
Do you believe your experience is common, or that you are an outlier?

~~~
_t0du
It's less me, and more the experience of myself, my close friends and
professional colleagues. But as with everything, I would assume it's a mix of
both.

~~~
tolbish
Can you speak more about these experiences? Are these colleagues from average
or elite schools? FAANG type backgrounds or typical corp resumes?

~~~
_t0du
No, we're all pretty average people. Mediocre colleges with mediocre degrees
and mediocre working histories.

------
davidw
I am really curious about this trend myself.

I live in a town - Bend, Oregon - that already had a lot of remote workers. It
also has a housing affordability problem that is getting rapidly worse.

I'm also curious about the "non-zoom" towns and what the dynamics might look
like there. Bend was already fairly well-known, but there are tons of former
mining/logging/ranch towns throughout the west that have access to a lot of
fun stuff to do in the outdoors, but are still relatively cheap because they
aren't "on the radar".

I facilitate a local YIMBY group here in Bend, but it's an uphill battle. A
town of 100K people can enact some good policies (and we have), but if even 1K
people from the bay area decided to move here, that would massively change our
housing market.

Perhaps moving onwards into the 'next hot spots' is what will keep happening?
But that still leaves people in service jobs that can't be remote and don't
earn as much as all the remote workers in a really bad spot. Who's going to
teach their kids? Take care of them in the hospitals? Fight fires?

I wrote about it here: [https://journal.dedasys.com/2018/07/27/fight-or-
flight-yimby...](https://journal.dedasys.com/2018/07/27/fight-or-flight-
yimbys-and-the-exodus-to-smaller-towns/)

~~~
war1025
> A town of 100K people

I know it doesn't really mean anything, but it always just seems peculiar to
me when people refer to places with tens or hundreds of thousands of residents
as "towns"

I guess mainly because the general consensus is that a "town" is smaller than
a "city".

The "town" I grew up in had about 3k residents. To us, the place a half hour
away with the big box stores where we'd do our shopping was the "city". It had
all of 30k people.

Then again, that was 10x the size of where we lived.

~~~
deanCommie
It all depends on what you're used to.

I was born in a City of 6 million people.

I then moved to a City of 2 million people. It feels small by comparison.

To me a "city" is a place with an opera house, multiple museums, multiple
options for every type of good international cuisines, shops open in the
evening, and a transit system beyond bus (tram, or metro/subway).

I lived for a couple of years in a place that was the capital of a European
nation, but was only about 600,000 people, and had "only" 3 Ramen restaurants.
It felt like a town to me, not a city.

So yeah, I basically feel like every place below 1MM is a town.

In a city, I should to be able to (though I never have, and never will) streak
naked down the street during rush hour, and for it to be a non-event. The
European capital I lived in that thinks it's a city once had a frontpage story
in the daily newspaper with the headline "Man on <street name> gets on all
fours and barks like a dog at passerbys". That's not a city to me.

3k residents I would call a village.

~~~
profile53
It’s interesting how different everyone’s perspective is on this — it hadn’t
crossed my mind before.

My parents grew up in a town of one thousand people. There was a small bakery
in the town and we had a leg up on all the other towns because we __had a post
office __. If I ever misbehaved and did something I wasn’t supposed to, my
parents knew before I even made it home because all of the residents knew each
other and could call my parents to tell on me.

Anything smaller than that was a village.

Later, I moved to a city of about 300,000 people. There were multiple big box
stores and, as you said, shops and restaurants open late into the night. That
city was surrounded by suburbia. That was a big city in my eyes.

Now, I live in a city of about 50,000 people and I guess that’s what a normal
city looks like in my eyes. It has a few restaurants, a few somewhat
culturally distinct areas, and a college and university.

When I visited New York City, I would have characterized it as a metropolis,
not just another city.

Going back, I think the defining characteristic for a city is that it’s large
enough not to keep everything in your head. You don’t know everyone or
everything in the city anymore, so you’re forced to make subdivisions. It’s
not “the bakery next to the Jones’s up the street” but instead it’s
downtown/uptown/Westside/Eastside.

~~~
deanCommie
That makes sense too!

I think by most people's definitions yours is closer to the standard. My wife
did not grow up in the 6MM city like I did but towns of 70,000, 500,000, and
3,000 respectively, and she thinks my "It's not a city unless it's over 1MM
people" take is the highpoint of douchey elitist snobbery.

I think that "keep everything in your head" is a reasonable cutting off point.
Despite me scoffing at that "only 3 ramen restaurants" city I lived in, it's
not like i know and have been to every restaurant in the place. A town you
probably would be able to go to each one if you wanted to after a year.

------
dontremeber
> Many Americans — especially 30-somethings who remain employed — are ditching
> their tiny rental apartments in hip districts of expensive cities and moving
> to buy houses in more affordable cities or the burbs...

I suppose I fall into this category but even houses in the burbs seem more
expensive than they should be. I’m specifically looking at up and coming
towns, not any random burb but buying a house that’s literally 2-3X what it
sold for 3-5 years ago is hard to justify. I really want to finally purchase
something but I’m worried the market will fall out from under itself in a year
or two after COVID financial aftermath settles down and I end up way
underwater.

EDIT: typo

~~~
randycupertino
I was thinking that the high-end vacation towns of the affluent would be a
pretty good investment bet, because even when remote work isn't popular there
still is high end demand for vacationers. Think places like Jackson Hole,
Aspen, Maui, Nantucket, Newport RI, Hilton Head, Scottsdale, etc... could see
places like that retaining their value no matter what happens.

~~~
shajznnckfke
Some of those places you listed crashed hard after 2008 and others didn’t. I
think there are trends in vacation destinations that can cause speculation.
Also, many of the the buyers are leveraging wealth from equities that is more
variable than the salaries the average homeowner uses. If there’s a prolonged
stock market drop during a recession, many may be forced to liquidate when
buyers are fewer and poorer (you’d prefer not to sell anything in a downturn,
but the vacation home might be the first to go). I saw people take huge losses
on vacation properties after 2008.

------
ultimoo
Right now, being a landlord in SF is looking pretty grim given that tech
workers who used to rent are fleeing in droves and those that are not are
negotiating their rents. I wonder whether this trend will reverse in the next
1-3 years or this is the new permanent dynamic of the SF rental market.

~~~
vmception
The midatlantic region is filled with cities that are carcasses of an
industrial era that doesn't exist anymore.

It's not "doom and gloom" to say that when there are examples of it happening
before.

San Francisco's tax base is leaving. What do you think is going to happen?

Rent wise, San Francisco will just be Anytown, USA with a little bit of
scarcity due to plethora of rent control and old tenants with grandfathered in
low property tax due to state law.

City better balance its budget.

~~~
dmode
I moved to SF in 2009 and there were very few tech companies in town and it
was in the middle of recession. Even then good places had a bidding war. If
you read this Bay Area housing market report[1], you will see that it still
showing strength in SFH market. My guess is SF will continue to do fine

[1] [https://www.bayareamarketreports.com/trend/san-francisco-
hom...](https://www.bayareamarketreports.com/trend/san-francisco-home-prices-
market-trends-news)

~~~
vmception
I can't believe you are still trusting real estate agents and mortgage
underwriters when half of the market signals are completely missing.....

yes, _to them_ it seems like a lot of business

evictions and foreclosures have barely started in San Francisco and will be
completely backlogged

nationwide: a few hundred thousand people playing around with low interests
rates, millions of people pending default

like I said, scarcity and views will continue to help San Francisco prices as
it has for the last 170 years, but it can also become like those midatlantic
satires of civilization.

~~~
dmode
I don't know what are data sources to look for real estate demand other than
real estate transactions. Anyways, that's not the broader point I am making.
The broader point I am making is that it was a thriving City with or without
tech and continue to be one. The Golden Gate bridge, GG park, the ocean, the
bay, the museums, the charming hills, and train cars is not going to vanish
when all tech workers leave. I fell in love with SF even before I started
working in SF.

~~~
baskire
I actually think rent going down in sf will open up a lot of opportunities
that wasn’t possible due to cost.

So much culture left sf to Oakland due to cost. As SF rent gets cheaper, I
suspect we’ll see art, food, and activism jobs come back.

------
chrisseaton
I think a lot of people living in cities think there's only two options -
living in an apartment downtown in a megacity, and living in a car-bound
wasteland suburb.

But there's a third option - towns.

I know you have them in the US! I've been to a few of them. Walkable towns
with coffee shops, restaurants, bars, culture, dating. You can even find a few
in the Bay Area if you don't want to look too far.

Isn't the small town an icon of American living? Why are people so incredibly
snobby about it?

~~~
ssequeira
What are some examples of Bay Area towns? It seems like everyone in my friend
circle in tech lives in San Francisco and puts up (or used to) with the long
commute.

~~~
ghaff
Quite a few of the towns in the South Bay have walkable cores: Mountain View,
Palo Alto, San Mateo...

You also have smaller cities all over the country.

Now, you get into truly small towns in places like New England and there
really isn't a lot in the town center and it's unlikely you'll be living
walking distance from it.

~~~
renewiltord
No way, man. You have to pay like $1.5 mil for a home in Palo Alto and
Mountain View. You do all that and you get a glorified suburb. No way. The
city is like 400x as city life for like 1.1x the price.

~~~
refurb
I would be shocked if one could find a liveable single family home in Palo
Alto or Mountain View for $1.5M.

Last I looked empty lots went for that much.

~~~
swimfar
By home, do you mean house? Sub-million dollar homes show up all the time in
Mountain View, even before Covid. Thinking anything less than a house is
unlivable for a family is not the norm in most other parts of the world.

~~~
refurb
I assumed you meant "single family home", but yes, you can find sub-$1M
apartments.

------
almost_usual
You’re also living in a prime wildfire area in Truckee. There’s too much fuel
in the Sierras as it is, it’ll burn sooner or later.

~~~
epistasis
The picture of a house they show nestled in the trees is incredibly dangerous,
incredibly resource intrnsive, and just ecologically unsound.

We need to be building massive amounts of housing in city centers to let as
many people live in them that would like to. Instead we lock down any new
construction in cities, which requires the least amount of infrastructure and
environmental damage, and instead let pretty much anybody build in
ecologically disastrous ways.

California is ruled at the local level, where decisions like this are made, by
an older generation of conservatives that have convinced themselves that their
personal pastoral aesthetic preferences of cars and suburbs and low density
sprawl that consumes vast amounts of wilderness is somehow conservationist.
It’s a massive problem!

~~~
pbourke
> We need to be building massive amounts of housing in city centers to let as
> many people live in them that would like to.

All else being equal, Americans will choose to live in a detached house on a
1/2 acre lot with an SUV or pickup in the driveway.

~~~
epistasis
This is simply untrue. Some people will, but this sort of “everybody who
doesn’t want what I want is lying to themselves” is elitism that destroys
people’s chances to live th way they prefer.

The higher cost of living in cities is pretty strong evidence that city living
is under supplied compared to suburban living.

~~~
Gibbon1
You can argue back and forth whether people in flyover country hate the idea
of living in dense housing or not. But if you peruse city and county planning
documents you find that most places it's completely illegal to build
greenfield projects with urban density. Instead of being able to build 25-35
units an acre you're allowed 3-4. And no mixed use allowed.

Seems to me the answer is people don't get a choice a most places. Would
people outside of old dense cities want to live in a walkable mixed use
development? We have no idea because those have been banned since before WWII.

------
yalogin
I wonder how sustainable this is. Part of this is obviously going to remain
but I can see a big swing in the other direction saying employees and groups
need to be together to generate the feeling of a team and that remote work
doesn't give you that.

~~~
dcolkitt
That’s likely true. But it's probably cheaper to fly the entire company and
their families to a ski resort every quarter, then it is to pay for Bay Area
cost-of-living and office space.

------
fortran77
We're "fantasizing" about relocating from Silicon Valley for our USA home (we
spend about 5 months/year overseas) but we've always thought it would be
foolish to stay in California because of the tax situation. If you could live
anywhere, a more tax friendly / less income-hostile state would be a good
idea. (However, if your employer is in CA, good luck not having California try
to collect anyway. They even are proposing a "wealth tax" that would apply
retroactively to people who left in the past 10 years!)

------
cjonas
I live in western Wyoming and the market (which was already pretty bad) has
been flooded by people trying to just get away from the city.

Winter will certainly spit the "softer" folks out, but it will be interesting
to see what sticks.

To the point about making less for remote work... You don't need 200k to have
a very high QOL in most these places (assuming you value an outdoor
lifestyle).

I would personally take a 50% pay cut before I'd consider moving to the city
for a 50% raise.

------
jamestimmins
"Still over 7% of active mortgages are in forbearance,"

This seems incredibly concerning, and could suggest an especially hard market
in the coming months/year.

------
jdhn
Ah, Truckee. Really, NPR should've lumped Western Nevada into the article as
well. I left Nevada in the mid 2010's, but housing prices were well above
their Recession lows. Now I look at houses in that area on Trulia, and the
prices just seem to go forever upwards. Scenic mountain views + no income tax
on the Nevada side + remote work + Tesla moving in = housing boom.

------
ponker
I think the concept of a “Zoom town” is important vs a “Zoom hamlet.” It’s a
lot easier to work with a remote 50 person engineering team than 50 remote
engineers, because you can just interface with the head of the group and
his/her direct reports. So I think long term 2nd tier cities will get
engineering hubs but the fully remote concept will remain niche.

------
Ericson2314
Talking about house prices, saying something about less supply, but not fully
comparing the volume of sales is IMO very misleading.

------
iwonderwhy
Curious what will happen to prices in these zoom towns once people return to
office work? Wouldn't it be more prudent to shop around in areas where we know
people will return in a year or two?

~~~
asdff
Probably depends whether or not there is a ski resort nearby to sustain
property values. reasonably convenient lots to the resort would eventually all
be infilled, at which point prices would surge exponentially. Otherwise it's
an overpriced mountain lodge, and mountain lodge supply increases
exponentially.

------
rhacker
So a pandemic hits and everyone screaming NIMBY is suddenly moving out?

------
jtdev
Can we stop referring to anything video conference related as “zoom”?

------
blueyes
Can we please call these bed-Zoom communities? ;)

------
alex_g
"Many Americans — especially 30-somethings who remain employed — are ditching
their tiny rental apartments in hip districts of expensive cities and moving
to buy houses in more affordable cities or the burbs for a life of shopping at
Home Depot and spending their Friday nights eating mozzarella sticks at
Applebee's."

oof, that's a savage take for NPR.

~~~
almost_usual
Who cares about NPR elitism. Why shame people for doing what they want.

Hell, the Buffalo Wild Wings in Daly City has a more diverse crowd than any
bar or restaurant in SF.

~~~
katzgrau
Honestly, BWW had the best tap lineup in my area for a long time, which has no
shortage of trendy bars.

~~~
rconti
The first time I walked into a BWW (maybe 10 or 15 years ago) my eyes opened
wide when I saw all the taps.

My excitement wore off when I realized that it was literally all budweiser
products and most of them had the exact same thing.

~~~
katzgrau
Ah yea. Good beers took a while to come to my area (maybe 5-10 years ago). I'm
guessing other parts of the country might have been a little different,
especially as Big Beer tried to catch the craft wave and smaller breweries
didn't have any distribution yet. Maybe it's different now in most areas
(hopefully)

------
the_cat_kittles
in case it is not obvious, the housing market, and real estate in general is
the front line of a very real class war. it is very effectively bifurcating
the population, as this article describes. i find this really upsetting and
immoral, but im sure other people will interpret the same thing differently.

