The post housing crash housing boom was almost entirely the result of the federal government--which has made, guaranteed, or bought significantly more than half the residential mortgages since 2008--deciding there should be a housing boom. If it is indeed coming to an end it is because the federal government collectively has decided not to double down and keep the party going.
This isn't the weather or even the price of gold. This is policy choices by government officials and should reported that way.
I'm not saying (in this post) that it is a good thing or bad thing, but it's what is actually going on and that's what newspapers ought to report.
The government responded to the crisis with fiscal austerity and massive levels of QE. If you wanted to enrich the FIRE sector and screw working class people that would be exactly how to do it.
If you look at inflation by sector instead of focusing on nominal and ignoring everything else, you find asset bubbles on stocks, bonds, and real estate, no wage growth and low rates of nominal inflation.
Austerity: difficult economic conditions created by government measures to reduce public expenditure.
> Federal Spending was increasing modestly, year on year, in the mid 2000s. But it jumped by $700 billion a year in the Great Recession to bail out the banks and provide “stimulus.” Since the recession federal spending held steady at about $3.6 trillion per year for a few years, before resuming growth in 2015.
Viewed from a GDP perspective, federal spending was steady at about 19 percent GDP in the mid 2000s and then jumped, in the Great Recession to almost 25 percent GDP. But in the subsequent economic recovery federal spending has steadily declined as a percent of GDP down to about 20 percent in 2014. But in 2015 federal spending started to increase as a percent of GDP.
The federal government never cut public expenditure. It went up considerably due to the stimulus and was magnified in terms of percentage of gdp due to drop in gdp. Over the years following the crisis the expenditures dropped as a percentage of gdp from the new elevated rate due to gdp growth, but saying there was austerity by the federal government is not true
> Total US Government Spending, federal, state and local, was increasing briskly, year on year, in the mid 2000s from $4.4 trillion in 2005 to $6 trillion in the depths of the Great Recession in 2009. For several years after the end of the recession total government spending leveled out at $6 trillion. But in 2015 spending started to increase again. per year.
Viewed from a GDP perspective, total government spending was steady at about 33 percent GDP in the mid 2000s and then jumped, in the Great Recession, to 41 percent GDP. But in the subsequent economic recovery total government spending has steadily declined as a percent of GDP down to about 34 percent GDP in 2015.
Maybe, but there was no austerity. There was a freeze in total spending in absolute terms and inflation was practically zero so real terms as well. The years prior to the crisis spending grew in absolute terms as th economy grew so spending stayed at the elevated rate
State budgets are utterly imploding under public debt obligations. To claim there was austerity in the US is comical. The lack of meaningful budget tightening now is going to cause actual austerity eventually though.
The Federal Reserve (which orchestrates interest rates to manage inflation and achieve full employment [two of its mandates]) is not (edit: a branch) of the US government, and does not set government policy.
Edit: This is incorrect. The Board Of Governors who set interest rates is a part of the federal govrnment as an agency (accountable to Congress), the individual Federal Reserve Banks are not.
> The Federal Reserve (which orchestrates interest rates to manage inflation and achieve full employment [two of its mandates]) is not part of the US government
Yes, it is. It's established by US statute, its board of governors is appointed by the President, and its personnel are paid by the US government. It is not considered part of any of the usual three branches of the US government (legislative, executive, judicial), but that doesn't mean it's not part of the US government.
To be fair you are both right. The board of directors is appointed by government officials and the bank was established by the Federal Reserve Act.
The bank is also privately owned and not by any government. I learned this because a technology director at the Dallas bank works with me in our side job.
> The bank is also privately owned and not by any government.
Each of the Federal Reserve banks is structured on paper as a private corporation, yes. But the US government effectively controls what they do; the private corporations do not exercise any of the normal functions of ownership that other private corporations do.
Have you ever worked for the federal government? My part time job is military. The government in that case really controls what we do. At the federal reserve they aren't regulated as a federal employer or a federal agency.
While it is technically true that the Fed is privately owned, it's not how it runs in actuality. The Fed chairman meets with presidents regularly, and many other politicians. The president also nominates the Chair of the Fed. So hardly independent [1].
The Board of Governors of the Federal Reserve System is a policy making arm of the United States Federal Government. It was created by and can be abolished by or have any of its functions changed or decisions overruled by statute, it's members are officers of the United States within the meaning of Article II, section 2, clause 2 of the US Constitution appointed by the President of the United States by and with the consent of the Senate.
Please stop spreading this nonsense. You may as well be telling people that they don't have to pay taxes because of the yellow fringes on flags in court houses.
The Federal Reserve banks are not one in the same as the Board of Governors of the Federal Reserve System. That's why they have different names. It's Board of Governors that determines the interest rate. It is a policy making part of the federal government.
> The Federal Reserve System is supervised by the Board of Governors. Located in Washington, D.C., the Board is a federal government agency consisting of seven members appointed by the President of the United States and confirmed by the U.S. Senate. The Board has about 1,850 employees.
I have updated both of my comments in this thread. Thanks for pointing out my misunderstanding between the Federal Reserve’s Board Of Governors and the Federal Reserve Bank entities they oversee.
it's not political, it's just got a board entirely appointed by the president with consent of the senate and has a congressional mandate to do stuff...
Of course it's been predicted. Economists have predicted 9 of the last 7 recessions.
But besides that, the Fed doing exactly what is was chartered to do and constantly issues press releases about is not a shocking revelation of hetereodox economics.
The Fed isn't doing exactly what it was chartered to do--it has had a dual mandate since 1977 that complicates its purpose. Regardless, the problem in this system seems more attributable to fractional reserve banking, which is force multiplier on the effects of central banks.
Doesn't surprise me, younger millenials won't have a home to sell and will thus have a hard time affording a home in an inflated market. Compounded with the fact that median wages haven't increased that much the last 30 years. Prices have to fall for that group to afford a home.
I really feel like this is it. Debt was introduced to parents of millennials. But it took some time to become institutionalized. Now millennials are in debt right as they get out of college. No matter what college you leave, you can have debt if your parents didn’t pay for your tuition. On top of that, wages have been stagnant. Then there is the credit card debt that is very easy to accumulate is you aren’t careful with the money that you do have. This younger generation is too busy paying off their debt. Then they are expected to save 5 years worth of salary to pay for house down payment so they can get a mortgage for 30 years. It’s possible to make it happen but it requires a lot more effort than it did for our parents or grandparents.
Even as a DINK millennial couple with a combined low six figure income a home purchase feels like a poor investment. Not only the down-payment of $100k+ but the property tax increases and then having to pay that mortgage for 30 years. Since we expect mobility and a certain level of future uncertainty it just doesn’t make sense for us and many more of our generation to tie ourselves to such and expensive geographic anchor.
The "NK" part of your "DINK" is probably influencing your decision on whether it's a worthy decision to buy a home.
As a "DI3K", a house makes a ton of sense. We need space, we need a place for five people to live, and we need a house in an area where the schools are going to be great for the next 18 years. We don't need mobility as far as relocation goes, because it just doesn't make sense in our life choices right now. I mean, it's certainly possible, but I've seen second-hand what moving from town to town every 6 months does to a 7-year-old.
I'm not mad that our property (as far from the coasts as possible) has increased in value ~$50-80K, either.
Don't forget shorter mortgage commitments are available (And a much better deal when you can swing them).
A lot of working professionals don't want the hassle of also being landlords, particularly remote landlords. If your tenant has a habitability issue, it's your problem. If they don't pay rent and you have to evict them, it's your problem. If they trash the place, it's your problem.
If you pay a property manager 10% to make it their problem, the economics of paying a mortgage on a home you're no longer living in and renting it out become significantly more questionable - particularly in some place like the Bay Area, where mortgage payments are already often more than you would pay to rent the equivalent dwelling.
If you are lucky you can get money from renting. If you were unlucky and had a house in the rust belt and jobs disappeared then few people could buy or rent your house. So people can get trapped. At least you can expunge your mortgage debt with bankruptcy. Not being able to expunge education debt is what's holding our economy down.
Other (less fair) ways of doing it include requiring a co-signer or allocating some assets as escrow. Although, like healthcare, the problem is probably the cost not the financing.
I think the OP meant “make their last tuition payment to the university”, in other words, they’ve fully taken on the debt of education and are about to graduate.
Dallas median wage is $63.8k in 2016, median home prices closer to $230 to $250 depending on which town (some significantly higher). That is about 4x income, following your heuristic we should expect the median to fall a bit?
I don't like this X-Salary rule. It assumes no other large notes, which is more of what mortgage underwriters are caring about (debt-to-income ratios).
Not having two student loan payments and a couple unnecessarily-high car payments (a couple well-to-do millennials surely make possible) could certainly push your mortgage affordability much higher than someone straddle with that debt (but completely able to pay and maintain it).
Builders keep building homes, home prices keep going up. In order for people to buy the newly built homes, you need to keep adding people capable of affording the inflated housing prices to the market. As you stated, millennial's (and many others) cannot afford it due to stagnant wages and student loan debt. They also cant afford the insane rents in many cities so ~23% of them live at home with their parents.
Eventually there are a ton of empty houses on the market without buyers, sellers are forced to lower their prices. People in upside down mortgages cannot sell as housing prices are lowered and foreclose, further dragging down the price. Market crashes. People with capital swoop in and buy up houses to rent out, driving up rent further as they can set the price.
This collapse will be slightly quicker than the last as the market is not as propped up with sub prime style loans. If salaries don't keep up with inflation a crash is inevitable. Deck is stacked against people without a strong financial base (upper middle class parents) but hey, they can stay on their parents health insurance for longer now, so that's nice.
The story here is quite different - only a 19% increase, and much more unstable over the years. Most of the increase happened before 2000. Almost no change since then.
I ran across an interesting proposal that one of the reasons for poor wage growth is health insurance costs -
Health Care and Other Benefit Costs
As nonwage benefits are beefed up by U.S. employers, such as expanded paid leave and performance-based bonuses, fewer dollars in their total rewards budgets may be available for salary increases.
But health care benefit costs are a prime suspect.
"The rise of health-care costs is the most important reason wages have not increased more for U.S. workers," Nobel economics laureate Edward C. Prescott and Lee E. Ohanian of the Center for the Advanced Study in Economic Efficiency at Arizona State University, wrote in the Wall Street Journal in 2018. "The extra compensation is swallowed up by health-insurance premiums."
A new white paper provides evidence that "the rising values of fringe benefits, such as health insurance, may have offset potential wage gains for middle-income workers" despite falling unemployment. The authors, Jeff Larrimore of the Federal Reserve and David Splinter of the congressional Joint Committee on Taxation, contend that when factoring in the cost of health coverage, "total compensation may be higher than previously believed, also implying that employer-sponsored health insurance benefits may represent a larger share of employee compensation."
Economics columnist Robert J. Samuelson wrote in the Washington Post:
The problem is plain: We'd all like both cheaper health insurance and higher wages, but the way the health-care system is operating today, we might get neither. As insurance premiums get more expensive, inflation-adjusted ("real") wages will continue to stagnate or decline.
1. Every idiotic meme about how goods X, Y, and Z have more than doubled in price while [real] wages haven't. I'm torn between thinking the meme creators are completely clueless or epic trolls.
2. There is a substantial linkage between nominal wages and nominal inflation, especially for limited, competitively bid goods (like housing).
Mortgage rates in the US have (AFAIK) usually a variable interest rate.
That means that it's sufficient for the lower income tiers (relative to the house value) to have a few months of high interest rates (in a time frame of 15-25 years) in order to lose the house.
Buying at the current rates is risky, while the risk of rising rates in 1988 was much lower. Factoring that in should change your conclusion.
("Yes and") There's also very little rate benefit to adjustable mortgages right now, so it's quite sensible to take a fixed rate mortgage. When I bought my first house (in 1996), I recall that fixed rate mortgages were several points higher than adjustable rate mortgages during their fixed portion. In cases like that, it made for an actual decision.
With both fixed rates and ARMs having roughly the same initial rates, there's little reason to choose adjustable.
I am quite convinced it would be possible to build a pleasantly-looking development of $25,000 sale-value housing at 50 or 70 miles away from the urbanized area and connect it with a fast transit rail to the main urbanization. Empty land should be cheap. Buyers should be plentiful. The reason why this does not happen, is because the bureaucracy prevents it. There seems to be a strong political necessity to make accommodation unaffordable. It is a deliberate policy, of which homelessness is just an unimportant byproduct. It is your risk and fear of becoming homeless that keeps the system afloat. These dangers enslave you to your employer and to the banksters. Be a good slave!
You describe the history of American suburban sprawl, ignored the fact that it's wholly unsistainable (as documented in may articles posted here, suburbs go bankrupt in 50-100 years when the maintenance bills and bond payments come due, unless they can force cities to subsidize them), and ignored the fact that is already exists all over the nation.
$25,000 can EASILY be spent, and triple that, just on getting well water, septic and electrical services to a rural property. I could buy 20 acres in Okanogan county WA right now for $18,000 but it'll be at the end of a dirt road, with no sewer, no water, and looking at $30k to extend grid electrical to it (or build a $20k off-grid photovoltaic system).
I'm guessing from your comment that you've never actually done the budget on what it costs to turn "cheap" land into somewhere you can build a nice residence.
Just built a 1680 square foot house on agricultural land. Septic was $18,000. Water well was $10,000. Electric company charged $3000 to bring a line out 400 feet from the road. Gas line cost even more to bring out.
And in many places consider that a road which is passable by a light duty 4x4 or pickup in summer, due to snow, may be snowmobile or snow cat access only in winter. Unless you pave the access road and have it plowed.
Look on Zillow, in really small places like Omak you may also need to telephone real estate agents. The way they do business there is like 15 years ago.
Presumably they're talking about a transit-oriented housing subdivision with hundreds of houses all centered around a train station. With that sort of arrangement, you'd have economies of scale on the utility hookups.
But other problems remain, like getting the train service.
Assuming a below average construction cost of $100 per square foot, $25k would let you build 250 square feet of housing. Not many people would be happy with that amount of space, and that doesn't leave any money for land acquisition, constructing any of the other infrastructure needed to support the house, or constructing the rail transportation.
Maybe it can't be done in the US, for various cultural, bureaucratic, and legal reasons, but it has been done successfully in other parts of the world.
I think if this was the case, wealthier people would swoop in and buy them up by the dozen, then rent them out for triple their mortgage. They would all be sold in bulk before the builder broke ground. Capitalism is very kind to those who already have capital.
I just built a home. One thing I noticed: Some builders are really stupid about reading the market and knowing what people are willing to pay. They load homes up with luxury features and then wonder why their homes sit vacant.
My builder has a vacant home in my neighborhood. He ran Ethernet to all rooms, and put in other silly features, and just couldn't comprehend why his price was too high.
> He ran Ethernet to all rooms, and put in other silly features
Isn't this normal by now?
My house is only a few years old but wasn't particularly expensive. When I bought it, it was already wired up with ethernet - I just had to replace the wall plates (they were RJ11 outlets instead of RJ45) and hook up an ethernet switch.
From what I've seen of other homes, it appears to be common for electricians to use ethernet for phone lines. Why wouldn't you? The difference in material costs is neglegable.
Why should this significantly increase the cost of a new home? Re-wiring an old home is annoying, but I don't see any reason why it should cost much for a new home.
Because 90% of non-tech people don't like wires. Nobody runs ethernet cables to all their devices. They don't want to have to worry about an Ethernet switch in the basement or a closet. Having a Wi-Fi router/cable modem in the bedroom is the most they want to worry about. With wireless networking they can have their devices wherever they want, without extra wires.
The number of people that don't even have a real Wifi router and just use the POS combination modem/router that Comcast provides (and charges a frankly usurious rental fee for) them bears this out.
In my country new built houses must have both Ethernet cat5 and coaxial TV cable run to every room. The wall plate can be rj11 however. The cost at build time is negligible.
> Ethernet to all rooms, and put in other silly features
I feel wired ethernet is essential. 2.4GHz is saturated and 5.8GHz has trouble penetrating certain rooms. I'm lucky that my 10yo condo has Cat5 wiring to telephone jacks in each room. Rather than an expensive wire run I just punch in new jacks.
What boggles my mind is poorly designed designer kitchens, bathrooms, and closets. Like adding granite countertops and a built in espresso maker suddenly means luxury. Our old apartment has less square footage yet felt 2x as large.
So would I, since wired networking is my jam. But I get the point the GP is making. The pool of potential buyers who would appreciate the value of that additional investment is small and (presumably) only getting smaller with time.
Anecdote: I realized how out of the mainstream I was when recently viewing a video produced by a high-profile gamer on Youtube showing off the specifications of his desktop gaming rig via Windows Task Manager. Yes, he had gobs of memory, many cores, and dual RTXs. But what caught my eye was that the network chart showed he was using wireless networking. On a desktop PC with two RTX 2080s. It make me laugh a bit; it made me cry a bit.
To reiterate: the point of my anecdote was to point out how out of touch I am. Sure, wireless gaming is fine.
Still, for me, I can't fathom investing the kind of money this fellow had on a gaming rig to then pair it with wireless networking. The scenario in brief: On one hand, I've opted for a blistering no-compromises frame rate, but on the other, I am tolerating a few more milliseconds of lag. Does not compute.
I remember enjoying the analysis that Riot did comparing wireless and wired gaming [1]. The chart showing the percentage of players using wired versus wireless at each of their ranking tiers is especially interesting.
In my home, I use Ubiquiti UniFi wireless access points. Comparing my workstation (wired) with my laptop (wireless, situated about 10 feet from an access point), pings to Google are delayed ~1.5ms by wireless with a few more random hiccups. Is that a big deal? No, not really for me. But then, I don't really game nor do I have dual RTX 2080s.
It's fine on bandwidth, but I learned for whatever reason it sucks for network filesystems... 15mbps powerline links absolutely kicked the pants off N900 for SMB performance.
How expensive is Ethernet to all rooms? That decision strikes me as a no brainer for any newly built house. Even if no one actually wants Ethernet in all rooms, it guarantees that Ethernet is present in the particular room(s) that the eventual buyer will want it in. And it will still be present in the particular room(s) that the next buyer will want it in. In contrast, if a room is missing Ethernet, it would be far more expensive to add it in after the fact.
Well, either my general contractor was an idiot and paid too much, or more than $200 a run.
Everything adds up, and when you realize that your kids are going to watch moves on their tablets, you quickly realize that money is better spent on something else.
I just ran ethernet and CATV cables to where the TVs go.
In 5 years, Ethernet outlets in homes will be like telephone outlets are today: a relic of a prior generation. I don't know anyone under age 50 who still has a landline phone. The next generation of home buyers won't know what an Ethernet cable is. Everything will be wireless. Apple doesn't even have Ethernet ports on their laptops anymore.
Wired connections are still needed for some professionals, and as we shift to more remote work (think remotely operating robots), the need for reliable network connections will increase.
Perhaps more importantly, wireless still connects to a wired router which needs to be somewhere in the house (unless we switch to more long-distance wireless, which I don't see happening anytime soon without both technical and political advances).
In my house, a major upgrade we did was install 3 additional access points, and we still have dead zones in one area because there was no Ethernet port (it would be 2, but one was a bedroom, so we ran a wire along the wall. Ugly, but bedrooms need wifi).
You are certainly correct that most people won't need Ethernet ports in every room
In the long term, it seems decently likely that the (unlicensed) spectrum will be too crowded for reliable wireless service of any kind. Urbanization and electronic communication are both on the rise; the usable bandwidth that physics has to offer isn't unlimited.
Ethernet to all rooms is really cheap, like one box of cat5e ($85), some $3 faceplates and $1.50 keystone jacks from monoprice. Assuming he did the typical builder thing of putting a steel box in the wall between two studs somewhere. Plus cost of low voltage installer labor to staple it to wood before the drywall is done, and maybe a $20 patch panel in the in-wall box. And a $9 punchdown tool. I've seen this done by installers who are actually illiterate and everything still passed 1000baseT qualification tests just fine.
Most construction materials are cheap. Especially at contractor rates. Labor is the expensive part. If you're a contractor you've got to have an hourly rate that covers your business expenses and pays you well. If it takes even just 20 hours of work to run all the Ethernet that's probably about $1500 added to the top line. Added a dozen features like that to a home and you're at $15,000-$20,000 higher asking price to make it worth your while.
20 hours for just Ethernet? That doesn't pass the sniff test. It seems like something that would be done concurrently with wiring the house, certainly with wiring coax. Even wiring an entire house should take a few hours at most when drywall isn't installed yet.
Not sure. I've never done it but two long days doesn't seem that crazy to me. Even without drywall up, you're up on a ladder for parts, you gotta hang boxes, you gotta bore a bunch of holes, you gotta do the punching. It adds up. Between planning, routing, testing and the time it adds to drywalling I think it could be more. But again, I've never done it so I don't know for sure. I've just strung a fair amount of Romex which takes longer than you'd expect.
Older Millenial here. Bought my house while prices were still low in late 2013. Cashed out in March of this year.
Thought it was crazy it was bubbling like this again. Time will tell if that was dumb or smart but I did pay off all my debt including student loans...
I personally think a crash is coming soonish. But that's just my gut.
Almost everyone thinks a crash is coming. There has never been a crash where almost everyone has seen it coming. Therefore there will not be a crash at least in the near future. Prices might pullback but it won't be a crash.
In order for a market (that's reasonably distributed) to move in a direction, there needs to be some level of consensus. If everyone thinks there will be a crash, then there will be a crash, because everyone will sell.
It's called the Black Swan fallacy. Ironically, it's what happened with the recession and housing crisis in 2008, except back then it was "the housing market isn't a bubble, people will never default on their mortgages en masse".
> As mortgage rates rise, buyers increasingly look for less-expensive homes.
File that under “duh”. Home buyers want to get the best house they can afford based on a given monthly payment amount, and as interest rates rise, the home price that you can afford for the same monthly payment decreases. Which gives rise to high interest rates actually being a good thing for prospective home buyers: you end up with lower home prices across the board and eventually you’ll be able to refinance into a lower rate.
I wonder if WSJ was chasing Bloomberg? Or if this phenomenon isn't really as strong nationwide as is being implied, but is mostly only in certain parts of Texas?
"Some home builders are so desperate to attract interest they are offering agents the chance to win Louis Vuitton handbags or Super Bowl tickets with round-trip airfare, if their clients buy a home."
If you'll humor the anecdote for what it is: I worked as a consultant business partner to real estate agencies and property management groups for a few years out of college (friend and I started a handyman company, grew it, sold it, became consultants), the phrase 'serious conflicts of interests' could unironically be adopted, publicly as an industry wide motto for the real estate profession and I don't think a soul would blink.
It is, but incentives for the buyer's agent are already messed up. They want to close the deal, they don't really care about the price because the bump in their commission for a few extra thousand is nothing compared to the risk of not closing. Buyers will talk up their clients and seller will talk theirs down.
It's not as crazy as it seems. Usually the best thing to do is compromise to close, since the Buyer wants the house and the Seller wants to sell it. Buyers and sellers often overestimate the other side's patience and wear it to the bone, then lose a home/sale pointlessly. Presumably everybody is in contract because they want to do the deal, and agents work to make that happen. Agents do have a fiduciary relationship with their clients, but if you enter into a real estate transaction don't be surprised if the people involved act as if you are serious about it and it's in your best interest to actually close.
That said, of course there is a group of agents who sweep problems under the rug to close. In my experience, there is a higher than average amount of agents like this among the top producers. But the group is not that big.
This sounds exactly like a narrative used to justify an ongoing conflict of interest.
For any piece of real estate, there's basically a price at which it would sell itself. People hire a real estate agent because they believe the agent will work to sell for more than that base price.
In my experience, both real estate agents represent the buyer as it is the buyer who is supplying the money. Your closing attorney is the professional more likely to represent your interests.
There is a reason why 90% of homes placed on the market without an agent don't sell and wind up being listed with an agent. I think you overestimate the average person's capacity to navigate a transaction without losing a ton of money. I once thought more like you do, but have seen too many cases where people were just not capable of much of anything without a lot of help. Those people would be destroyed on the open market without an advocate, and every professional advocate will require payment. Agents earn about 1.5% per side once brokers take their commission. They are usually worth the money.
I believe one of the first few chapters of the four-hour workweek talk about this exact conflict of interest. Blew my mind when I first read it many years ago.
The buyer's agent is supposed to act in the best interest of the buyer. It's tough to say that's always the case when the buyer paying a bit more rather than walking away would actually help the buyer's agent earn more. Normally there are pre-negotiated commission rates the buyer's agent would receive.
To ensure you've got someone who is truly on your side as the buyer, maybe it'd make sense for your agent to be paid for services as consumed. E.g. $50 for doing a private showing, $200 for putting together the first offer and $70 for subsequent offers.
Why would you even have a buyer's agent? In Australia, the seller has an agent (often on commission) to arrange ads and conduct opens. Buyers visit and then make an offer if they wish. A buyer's agent would be quite rare - maybe only for very, very expensive properties.
Does the buyer's agent in the US handle the role of a conveyancer in sorting paperwork of the final sale?
US estate agent fees are absurd too. Standard seems to be 5-6% split between the buyer’s and seller’s agents (both paid by seller) - almost $100K on the median San Francisco home.
maybe it'd make sense for your agent to be paid for services as consumed
I've actually heard/read of a few boutique style agencies taking this approach in LA. Will dig around the history and update this post if I find the blog post talking about it.
There's also free WSJ via the Read Across The Aisle browser plugin and iOS app. It's a side project of mine, and there's no data monitoring or monetization. http://www.readacrosstheaisle.com
Why does HN allow intentional bypass of paywalls? It’s no different than providing links to pirated software. On the one hand, we complain about aggressive advertising while simultaneously doing everything possible to ensure publications don’t earn any money.
It isn't quite the same, because these publications do offer their content for free... to the Google indexer. So they're kind of trying to have it both ways.
That said, I agree with the broader point: if you value something that has a price on it then you really ought to pay for it at some point. You can object to anything you want ("there are still ads!", "why can't I pay per article?"), but it's all besides the point. There is a price attached and you can pay it or not pay it, but refusing to pay while still consuming it isn't really defensible, beyond "I can do it and you can't stop me".
Fair point. I'm not really sure it's a comparison worth exploring too deeply as there are just too many differences. For instance, what's the pirated program equivalent of viewing just one article?
I think (hope?) most people here would agree that a hack providing you with a full WSJ subscription would be inappropriate. But many are fine with a single article. Perhaps that's hypocritical, I dunno.
If the reviewer normally reviews free games, and it was sent to the reviewer with a stated MSRP of $0, then it is misleading to try to charge everyone else after they read the review.
I think this is a fair question. I think the reaction would be different if e.g. a link to a cracked copy was added to every post about a piece of software.
Things have also cooled off in the Palo Alto area. I've seen houses dropped by $400k in the last few months, typically from nearly $2.5M to a bit under $2M. At first I thought it was just to get a bidding war started, but the homes then sold for not much over the lowered price.
This is still a far cry from "affordable", but it's a change of pace from the last six years.
I've toured a couple of houses in Palo Alto in the past month. The agents were practically begging us to make an offer below asking price. I thought it was really weird. Of course, even then the prices would still be about double what I would consider reasonable.
I'm curious to see how much things soften after people do their 2018 taxes next year and realize the magnitude of the impact of not being able to deduct property taxes anymore. (In CA, the $10k cap is eaten up by state income taxes, at least for anyone who has enough money to purchase a home.)
It is a mix. Housing prices have been going up by about 20% for a while except for this year. 1% interest rate increase is more or less equal to price going up 20% in terms of monthly payment. Add lack of salt, and it falls behind.
Valley real estate is insane. The houses are old, tiny and probably full of health hazards(lead, asbestos). The infrastructure is crap. The whole area is earthquake prone. You'd think the smart folks in the area would stay out of the market...but after looking at rentals over the last month I'm starting to understand why people still buy. I think it's stupid...but I understand their perspective.
A wild thought - How much of this is caused by H1B visa restrictions and higher visa rejection rates? Dallas, and Texas in general, is home to the fourth largest Indian population in US. I reckon that these high paid tech people are abstaining from purchasing any real estate owing to the uncertainity in their existence here.
IDK, looks kind of like supply and demand starting to balance out in an area where that's allowed to happen. Mostly through sprawl, rather than other, denser types of development, but it is allowed.
I believe we are seeing normal corrections in the housing market which has been overheated due to low interest rates. It is not some big conspiracy by the government and it is not a big collapse as some are making it out to be.
1/8th of a percent on a 30 year mortgage equals 80 dollars more per month on a 500k home, over 30 years, that is 28 grand more you are paying. The mortgage rates went from low 3% to high 5%, now even at 6%, in a matter of a few years. Of course this will cool the market a bit, people can do the math that much more in interest is hundreds of thousands.
This is very different from the 2008 crisis where people that had no business owning homes were defaulting on their loans. This is just supply and demand, standard capitalism. Home prices will come down a bit and they will start selling more homes.
This isn't the weather or even the price of gold. This is policy choices by government officials and should reported that way.
I'm not saying (in this post) that it is a good thing or bad thing, but it's what is actually going on and that's what newspapers ought to report.