What do you mean by this? That housing prices went up or down? I would assume you mean gentrification and the prices went up, which woudl increase the value of any local with property. I would consider that a good thing, not horrible. And what do you mean by vice versa, the local housing prices hurt the software companies?
Software/Digital isn’t going anywhere. The dot-com bust didn’t stop the internet.
Even if the jobs created ends up being just half of the estimate, most localities should benefit from the increased economic activities that many jobs will stimulate.
It’s kinda funny, we always talk about how we need to create jobs in America, Amazon is talking about realistically creating 25k of them, and now we’re talking about if that’s a bad thing…
Lol, I mean, do we want companies to create jobs here or not?
NIMBY - not in my back yard…
Absolutely we do.
I don’t see any major issues in trying to think ahead of an unintended consequences though. Cause and effect and all that. Science bitches!
[quote=“Drew1411, post:61, topic:235715, full:true”]
What do you mean by this? That housing prices went up or down? I would assume you mean gentrification and the prices went up, which woudl increase the value of any local with property. I would consider that a good thing, not horrible. And what do you mean by vice versa, the local housing prices hurt the software companies?[/quote]
It’s not a good thing when house prices increase to 4-5x the national average (at bare minimum) and wages don’t increase to compensate.
The housing market in Silicon Valley is only affordable to the few tens of thousands that have benefited from the massive salary paid by the tech companies. The millions who are left out of it are seeing monster rent that makes it increasingly difficult to even rent apartments.
You would average about $2,600 just to rent a two-bed, one-bath apartment here,and that would be dilapidated.
From what I understand, Seattle is headed the same way.
The problem I see is that software companies tend to create such massive income disparities in the region that whatever benefits they may have brought with their arrival is negated by the negative impacts said income disparity causes.
No, but it did slow it down temporarily. I think you need occasional speed-bumps. Though I think the
It is for current house owners.
Silicon Valley, San Fran, and California in general are not great models of how the market works elsewhere. Rental prices will go up, but the degree depends on a lot of things.
I don’t disagree, but Amazon would need more than a speed-bump to knock it off course.
lol, of course. I just think it’s a funny conondrum.
It’s a good thing. If somehow governments could keep from pissing tax dollars into private business it would be a great thing.
@magick and @Drew1411, talking about housing prices.
If we could predict Amazon’s location, it would be a good time to buy a rental property or two and flip them.
I don’t think they will choose a CA/ West Coast location. This is a pretty interesting article. Check out the locations of the bubbles. For those of us already living with sky high housing.
Analysis by an economist friend of mine…
While the author’s explanation of high urban housing prices is wrong (he claims it’s a bubble caused primarily by evil real estate speculators), his DATA presentation is first rate – quite informative. Note that 3 of the 4 worst major cities for housing are in CA. The author’s “bubble” theory ignores the supply factor. In CA it’s very difficult to build more housing. Most of the problem emanates from state and local government anti-housing laws (there’s plenty of land for building). For example, for most years this decade, the CITY of Houston has issued more home building permits than the entire STATE of California (39 million people – 1/8 of the nation’s population).
Moreover, huge housing fees (tens of thousands of dollars) are imposed for building a home – by far the highest in the nation (most states don’t charge ANY such fees).
All this results in more people leaving CA for other states than moving here FROM other states (“net domestic migration”). Since 1992 we’ve lost a NET FOUR MILLION PEOPLE to other states. I say again – NET. Our population is growing at half the rate of Texas (immigration, births and longer life expectancies are the factors fueling CA growth), and yet our housing prices soar.
[quote=“Drew1411, post:66, topic:235715, full:true”]
It is for current house owners.[/quote]
I’m not sure.
If your house price went up, then that probably means that the entire neighborhood’s price has gone up as well.
Ergo, you cannot really sell your house for a profit unless you plan on moving to somewhere cheaper. Having your house appreciate in value doesn’t seem to be much of benefit in a practical sense unless you bought the house with the goal of flipping it.
Now, if you got into talking about pulling money out of your house… Maybe? It seems to be an incredibly risky move in my uneducated mind though.
[quote=“Drew1411, post:66, topic:235715, full:true”]
Silicon Valley, San Fran, and California in general are not great models of how the market works elsewhere. Rental prices will go up, but the degree depends on a lot of things.[/quote]
Maybe, but my argument is that the massive wealth increase to a select tens of thousands has a negative impact to the local region itself. The kind of massive wealth increase that comes with software tech companies would appear to be outside of conventional market practices.
I wasn’t referring to Amazon the company itself, but the software companies in general.
Edit- Why is it that only the last quote I have work but the earlier ones don’t? I’ve been seeing this happen with all of my posts quoting people lately.
Fuck the so-called liberal cities and their housing laws.
My parents wanted to change a useless family room that our old house has into an actual room when they were renovating it, among other things The city required them to place two possible avenues of exit. That is, the actual door itself and a window large enough to be used as an exit in an emergency.
This took them way out of budget, and so they scrapped the idea of the full-fledged renovation entirely. They just made do with a face-lift.
I can understand the point behind it, but it gets to what pisses me off about liberals these days.
Yes, it’s great to have X and Y. Most of us cannot afford to have X and Y. There are prohibitively expensive reasons why X and Y cannot be achieved in a practical manner. In this case, it was ripping down the entire wall to make space for two fucking windows large enough to be used as an exit.
You know what the worst part was? The house was constructed in the early 60s or some such, so none of the rooms actually fulfilled the above criteria. IIRC, we would have been flagged by the city inspectors if they came out to view the property as required during a full-fledged renovation.
@anon50325502 - I understand why you’d ask the question, and my reply is the same as beans’ reply. Of course we want jobs for all around the nation. The question is, as a resident of a given region (that’s generally doing pretty well right now) with a potentially very large employer coming, how strong are the pros for the region versus the cons. If all other things are held constant, more jobs are great; but as we all know, “all other things held constant” is not how life works, and I’m trying to feel out what the potential cons that I may not have thought of are, or how legitimate the concerns I do have actually may be (ie the explosion in housing prices - I already own a home, so I’m safe here, but IDK just how real that effect is or how it would translate to my region, so I appreciate some guys talking about it).
Of course, like I said in my follow up to Beans, it’s just a funny conundrum is all.
If you were buying a house in cash and moved within the same neighborhood there would be no gain or loss, but almost nobody does that outside of investment properties.
If I have a house that is worth $500k, you would usually put 20% down, or $100k. If the house value goes up to $600k, I now have $200k of value if I sold it, and could afford to buy a house for $1M if I chose to invest all my gains into an upgraded home. I could also move within the same neighborhood with $120k down and cash out with $80k. Obviously I’m ignoring closing costs for this simple example.
I don’t think you are making the argument where it is beneficial for housing prices to fall for a house owner, as they would owe more money, but if you followed the logic that increasing housing prices hurts that is where it leads. I disagree, as I think it is beneficial for the house owner to have a more valuable asset that they own. They could use the additional money in countless ways.
I think it is not as clear cut as that. It clearly benefits some, and would not be beneficial to others. That seems to always be the case with gentrification.
To take your argument further, are you against all businesses moving to a city and bringing jobs or when you mention tech companies is it the wealth disparity that you see to be the main issue?
I’ve had this issue as well, i usually edit the post and mess with the quote text, but I haven’t exactly figured it out.
There’s also people (like out in CA) that use their houses as ATMs via cash out refinances. Sure it creates a bubble, but you just make sure you’re not the one holding it when it pops. Ezpz.
I think it depends on why the market increased and what you do with that money. In this situation, a company like Amazon relocating is going to bring stable jobs, not a bubble. It is much different when the price increase is due to wall street investors and banks having specific interest rates, that can change quickly.
Obviously things got carried away in 07/08 with the confidence in how low risk such a tactic is. Most people aren’t good at understand risk though and bet everything on it, and when they found out the promise their realtor told the about housing prices always ascending didn’t come true they didn’t have much to fall back on.
I was more commenting on one of the benefits people see re: increasing house values. Pretty much everything you said I agree with.
You’re right. Even if there are good reasons to refinance and use house appreciation to your advantage, people will screw it up. Anyone who is betting a significant amount of their net worth on one market is setting themselves up regardless of what market that is.
If anyone reading this thread were to take anything away from it, I’d hope it’d be this. Fuckin’ A right Drew.
Law of averages man. Average American has no business doing something like a constant refi to micro manage their debt. I see it at work literally every day. Total shitshow.
And the funny part is only the ground level guys will REEEEALLY feel the pain. Big guys will just get bailed out again. Imo the housing industry is the only industry that truly is too big to fail (and has legit risk of failing).