Northstar1989 t1_iy4gamm wrote
Reply to comment by Hodgkisl in This is the first house 3D-printed from bio-based materials - The new technology could come in at a key moment. by speckz
Exactly.
If there weren't artificial scarcity of housing due to NIMBY Zoning Laws against denser development (which can mean just duplexes and single units built closer together: it doesn't even mean apartments most of the time, although that's often where density SHOULD be) then higher profits would lead to more companies entering the construction business, and more business for existing firms... More housing would be built, and the shortage would wane.
But because of the artificial scarcity of land created by zoning laws, lower construction costs just equate to TEMPORARY profit increases for builders, and no actual increase in construction (because there's nowhere to actually build more homes much of the time, they wait for the rare upcoming or release of undeveloped land...)
Temporary, because eventually the higher profits just lead to land prices going up, once landowners realize they can now sell land (or rather, old houses to be torn down and replaced with newer ones, in many cases) for more money and the builders can now afford it.
Since every homeowner had to buy the home at some point, homeowners don't really profit either, after a small group selling at the right time profits off the small spike in land costs due to cheaper construction, as they're eventually saddled with even more enormous mortgages...
The only group that profits off this in the really long run, are the banks that give out mortgages for ever more expensive homes...
Hodgkisl t1_iy4jssy wrote
Existing home owners can win as well, especially if they desire to leave the desirable cities and move to more rural lower cost areas. Near where I live many retirees from middle class jobs in NYC move here and live like kings off pensions and the value their apartments sold for.
NIMBY are the largest issue in housing costs, the restrictive zoning hurts everyone long term.
Northstar1989 t1_iy4mvm2 wrote
>Near where I live many retirees from middle class jobs in NYC move here and live like kings off pensions and the value their apartments sold for.
Boomers who already helped to pull up the ladder to prosperity behind them (supporting conservative politicians who slashed state support to state universities in the late 70's and early 80's, leading to a nationwide explosion in tuition prices, for instance...)
Do they really need more money?
Or perhaps, we should tax those sales more (Capital Gains taxes apply to home sales, I believe? Hard to recall rn, tired and have Post-Covid Syndrome brain fog) and use the money to incentive local communities to relax their zoning laws instead?
(Was part of Elizabeth Warren's housing plan for if she had been elected, actually: offer grants to communities they can receive for relaxing zoning laws, targeted to the areas with the strongest jobs markets and highest housing prices, as the high prices are a market indicator of a local housing shortage...)
Hodgkisl t1_iy4ogwx wrote
Capital gains does not apply up to 500k if gain for a married couple to primary residence sales if a replacement home is purchased.
Edit: looks like you no longer must buy a new home, any primary residence sale is eligible if you lived in it for 2 years.
Northstar1989 t1_iy4ox3a wrote
If there's a difference in prices, due to moving to a cheaper area?
Hodgkisl t1_iy4pr0u wrote
Please see my edit, you no longer must buy a new home for primary residence sale. I believe you used to have to buy another.
Also fun is with investment property you can 1031 exchange and avoid any amount of capital gains indefinitely.
Northstar1989 t1_iy6z92p wrote
That's.... problematic.
Clearly we need to fix those tax laws so millionaires with 5 investment properties can't avoid taxes forever
Hodgkisl t1_iy7q18z wrote
The 1031 exchange has helped many become rich, its a huge distortion in the real estate market.
Northstar1989 t1_iy4lw82 wrote
>Existing home owners can win as well
Only once, when the construction costs drop.
Eventually the new, higher housing prices (because the drop in construction costs actually leads to an INCREASE in housing prices dur to artificial scarcity. Counterintuitive, I know...) phase into the housing market through homeowners making upgrades to larger homes and first-time buyers.
So, everyone loses in the end except the banks, all due to zoning laws.
Hodgkisl t1_iy4m5f5 wrote
My apologies I was referring to NIMBY laws in general, the rapid rise in home prices can benefit existing owners when they sell and leave the area.
Northstar1989 t1_iy4omm2 wrote
>the rapid rise in home prices can benefit existing owners when they sell and leave the area.
Again, once.
In the long run, even existing owners (who are younger, and still looking to upsize rather than downsize) get screwed, as well as everyone who doesn't currently own a home and rents.
Not coincidentally this latter group is disproportionately poor, brown, and young. All groups conservatives love to screw over.
Northstar1989 t1_iy4mxsr wrote
>Near where I live many retirees from middle class jobs in NYC move here and live like kings off pensions and the value their apartments sold for.
Boomers who already helped to pull up the ladder to prosperity behind them (supporting conservative politicians who slashed state support to state universities in the late 70's and early 80's, leading to a nationwide explosion in tuition prices, for instance...)
Do they really need more money?
Or perhaps, we should tax those sales more (Capital Gains taxes apply to home sales, I believe? Hard to recall rn, tired and have Post-Covid Syndrome brain fog) and use the money to incentive local communities to relax their zoning laws instead?
(Was part of Elizabeth Warren's housing plan for if she had been elected, actually: offer grants to communities they can receive for relaxing zoning laws, targeted to the areas with the strongest jobs markets and highest housing prices, as the high prices are a market indicator of a local housing shortage... Funny how I can remember some random things, but not others...)
vc6vWHzrHvb2PY2LyP6b t1_iy6bw3o wrote
We also need to step out of the "Every American family needs a 2,000+ square foot home with a huge yard" mindset. If we all lived with the same density as NYC and left nature to nature, we'd be much better off as a planet.
That doesn't mean restricting land, it means that the land we already allocate to housing will hold MUCH more housing and costa will ultimately go down.
maretus t1_iy82z9f wrote
The only way to accomplish this on a national scale is through force. So; it won’t happen.
detectiveDollar t1_iyfc5o4 wrote
Part of the problem is that most of what's smaller than 2000+ square feet that's relatively new construction in a decent area with nearby jobs are townhouses with gated communities (at least in my area). Townhouses are great, but they have a steep HOA fee which makes the seemingly affordable mortgage a lot less affordable.
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