The real housing crisis is one of quantity

The real housing crisis is one of quantity

The REAL housing crisis is that TOO MANY of them are being built every
day, bad mortgages or not. Mindless overpopulation (75 million
annually, worldwide) is treated as natural. Nature is treated as
expendable.

People go about their business, talking about money and investments,
as if the land itself is infinite. They always claim there's "plenty
of land" but won't say relative to what. Unaffected acreage decreases
literally each second.

* images.google . com /images?hl=en&q=human+footprint+map

"Economic growth" means more people and less nature each day, with
money creating a false measure of value in the process. A true housing
"bubble" is an entire round hill covered with them.

Real estate developers use money made from cannibalized land to
cannibalize even more land. The word FINITE is missing from too many
vocabularies.

E.A.

* enough already.tripod . com /

Housing starts are a leading indicator of mindless growth.

Re: The real housing crisis is one of quantity

On Apr 19, 12:29 pm, Enough Already <enough alre...@lycos . com > wrote:
> The REAL housing crisis is that TOO MANY of them are being built every
> day, bad mortgages or not. Mindless overpopulation (75 million
> annually, worldwide) is treated as natural. Nature is treated as
> expendable.
>
> People go about their business, talking about money and investments,
> as if the land itself is infinite. They always claim there's "plenty
> of land" but won't say relative to what. Unaffected acreage decreases
> literally each second.
>
> * images.google . com /images?hl=en&q=human+footprint+map
>
> "Economic growth" means more people and less nature each day, with
> money creating a false measure of value in the process. A true housing
> "bubble" is an entire round hill covered with them.
>
> Real estate developers use money made from cannibalized land to
> cannibalize even more land. The word FINITE is missing from too many
> vocabularies.
>
> E.A.
>
> * enough already.tripod . com /
>
> Housing starts are a leading indicator of mindless growth.

i agree, greed drove the industry and now many houses are sitting
empty, no one to buy and too many people losing homes they had, almost
seems pre-determined to cause this current problem, all seems to be
blamed on the housing market, but there are many other factors
involved, every market has been inflated, oil companies claiming they
are losing money, grocery stores, etc. and yes, too many homes were
built but that is not the economies problem really, the cost of
everything has soared, where will this end? and to what end? and why?

Re: The real housing crisis is one of quantity

Rose wrote:

>
> i agree, greed drove the industry and now many houses are sitting
> empty, no one to buy and too many people losing homes they had, almost
> seems pre-determined to cause this current problem, all seems to be
> blamed on the housing market, but there are many other factors
> involved, every market has been inflated, oil companies claiming they
> are losing money, grocery stores, etc. and yes, too many homes were
> built but that is not the economies problem really, the cost of
> everything has soared, where will this end? and to what end? and why?

It won't end. It is the natural cycle of things. It's a buyer's market
now and in a year or two it'll be a seller's market again. All markets
fluctuate up and down. Sometimes it's severe and sometimes just minor.

--
Art

Re: The real housing crisis is one of quantity

Rose wrote:
> On Apr 19, 12:29 pm, Enough Already <enough alre...@lycos . com > wrote:
>
>>The REAL housing crisis is that TOO MANY of them are being built every
>>day, bad mortgages or not. Mindless overpopulation (75 million
>>annually, worldwide) is treated as natural. Nature is treated as
>>expendable.
>>
>>People go about their business, talking about money and investments,
>>as if the land itself is infinite. They always claim there's "plenty
>>of land" but won't say relative to what. Unaffected acreage decreases
>>literally each second.
>>
>> * images.google . com /images?hl=en&q=human+footprint+map
>>
>>"Economic growth" means more people and less nature each day, with
>>money creating a false measure of value in the process. A true housing
>>"bubble" is an entire round hill covered with them.
>>
>>Real estate developers use money made from cannibalized land to
>>cannibalize even more land. The word FINITE is missing from too many
>>vocabularies.
>>
>>E.A.
>>
>> * enough already.tripod . com /
>>
>>Housing starts are a leading indicator of mindless growth.
>
>
> i agree, greed drove the industry and now many houses are sitting
> empty, no one to buy and too many people losing homes they had, almost
> seems pre-determined to cause this current problem, all seems to be
> blamed on the housing market, but there are many other factors
> involved, every market has been inflated, oil companies claiming they
> are losing money, grocery stores, etc. and yes, too many homes were
> built but that is not the economies problem really, the cost of
> everything has soared, where will this end? and to what end? and why?

The key to understanding the housing bubble is understanding what drives up
land prices. The OP is correct in saying that new construction was over
done. The reason is rising land value, but why did land values double and
redouble since the 1980's?

In our system, the financial sector has no problem creating funds for
inflating land value. In fact, in a rising land market, mortgage lenders
KNOW they can write home purchase checks without ANY real money on hand.
They KNOW that real estate sellers will put ALL the money right back into
buying other land.

Land prices rise because they are rising. All it takes is a small push
like a drop in property taxes, capital gains taxes, or a drop in interest
rates and it's off to the races. The upturn in land prices means this
capital gains opportunity will be reflected in even higher land prices.

And so it goes until everybody is mortgage debted up to their eyeballs. At
this point all it takes is one little bitty ol economic nastiness that
reduces the ability to make those big mortgage payments. A war or a sudden
jump in oil prices works nicely. Then the whole thing comes down with a crash.

Land prices cannot level off smoothly. As soon as they stop rising, they
have to fall and fall hard. This is because a big part of land price is
about the future investment payoff that buyers expect in a rising land
market. No more expected price appreciation, no more price premium.

Mark M.

Re: The real housing crisis is one of quantity

On Sat, 19 Apr 2008 18:59:29 -0500, "Mark M." <markm@techz . net > wrote:


>
>The key to understanding the housing bubble is understanding what drives up
>land prices. The OP is correct in saying that new construction was over
>done. The reason is rising land value, but why did land values double and
>redouble since the 1980's?...

The Shiller home price index shows home prices in the 20 major urban
areas rose a real 21% during the 15 years 1987-2002 -- a tad more than
1% a year.

So much for "double and double again".

This is entirely consistent with Shiller's data showing home price
appreciation barely exceeding inflation, appreciating by about 0.5%
real per year, for the last century.

Which is entirely consistent with USDA/NASS price index of all
farmland in the US, which shows land prices across the great bulk of
the US barely matching inflation, appreciating by about 0.5% real per
year, for the last century.

These indices show land value hasn't doubled even once in the last 100
years, much less gone "double and double again" since the 1980s.

Georgists. ;-)

There's their world and there's ours.

Put your money in land, then do nothing as a landowner but wait for it
to appreciate in value ... and die broke. ;-(

As to the home price boom, it has been *world wide* -- Britain,
France, Spain, Australia, New Zealand, China, all around the globe,
and in several foreign nations it's been much *bigger* than in the US
-- and it has all happened everywhere simultaneously in the last six
years.

So a different explanation is called for, other than repitition of ye
olde fact-free Georgist creed.

Re: The real housing crisis is one of quantity

RogerDodger wrote:
> On Sat, 19 Apr 2008 18:59:29 -0500, "Mark M." <markm@techz . net > wrote:
>
>
>
>>The key to understanding the housing bubble is understanding what drives up
>>land prices. The OP is correct in saying that new construction was over
>>done. The reason is rising land value, but why did land values double and
>>redouble since the 1980's?...
>
>
> The Shiller home price index shows home prices in the 20 major urban
> areas rose a real 21% during the 15 years 1987-2002 -- a tad more than
> 1% a year.
>
> So much for "double and double again".
>
> This is entirely consistent with Shiller's data showing home price
> appreciation barely exceeding inflation, appreciating by about 0.5%
> real per year, for the last century.
>
> Which is entirely consistent with USDA/NASS price index of all
> farmland in the US, which shows land prices across the great bulk of
> the US barely matching inflation, appreciating by about 0.5% real per
> year, for the last century.
>
> These indices show land value hasn't doubled even once in the last 100
> years, much less gone "double and double again" since the 1980s.
>
> Georgists. ;-)
>
> There's their world and there's ours.

Yours and Shiller's? LOL

Real estate price appreciation barely matching inflation? What a joke.

* video.google . com /videoplay?docid=-2757699799528285056

Mark M.

>
> Put your money in land, then do nothing as a landowner but wait for it
> to appreciate in value ... and die broke. ;-(
>
> As to the home price boom, it has been *world wide* -- Britain,
> France, Spain, Australia, New Zealand, China, all around the globe,
> and in several foreign nations it's been much *bigger* than in the US
> -- and it has all happened everywhere simultaneously in the last six
> years.
>
> So a different explanation is called for, other than repitition of ye
> olde fact-free Georgist creed.

Re: The real housing crisis is one of quantity

On Mon, 21 Apr 2008 00:57:24 -0400, RogerDodger <none@not-here.org>
wrote:

>On Sat, 19 Apr 2008 18:59:29 -0500, "Mark M." <markm@techz . net > wrote:
>
>>The key to understanding the housing bubble is understanding what drives up
>>land prices. The OP is correct in saying that new construction was over
>>done. The reason is rising land value, but why did land values double and
>>redouble since the 1980's?...
>
>The Shiller home price index shows home prices in the 20 major urban
>areas rose a real 21% during the 15 years 1987-2002 -- a tad more than
>1% a year.
>
>So much for "double and double again".
>
>This is entirely consistent with Shiller's data showing home price
>appreciation barely exceeding inflation, appreciating by about 0.5%
>real per year, for the last century.

I proved years ago that the Shiller index is designed to hide land
value increases.

See if you can figure out how before I explain it to you. It will be
a good test of your willingness and ability actually to think for a
change. I'm not hopeful.

>Which is entirely consistent with USDA/NASS price index of all
>farmland in the US, which shows land prices across the great bulk of
>the US barely matching inflation, appreciating by about 0.5% real per
>year, for the last century.
>
>These indices show land value hasn't doubled even once in the last 100
>years, much less gone "double and double again" since the 1980s.
>
>Georgists. ;-)

Georgists are at least willing to know the facts.

>There's their world and there's ours.
>
>Put your money in land, then do nothing as a landowner but wait for it
>to appreciate in value ... and die broke. ;-(

LOL! As if everyone reading this doesn't know landowners who have sat
on land and made out like bandits!

>As to the home price boom, it has been *world wide* -- Britain,
>France, Spain, Australia, New Zealand, China, all around the globe,
>and in several foreign nations it's been much *bigger* than in the US
>-- and it has all happened everywhere simultaneously in the last six
>years.

Of course, your claims are all false. Japan had its big land boom in
the 70s and 80s, and has experienced no significant housing price
inflation in the last several years. Certainly there have been
housing booms in a number of countries, but that's simply because the
same factors have been operating, especially cheap credit and
extravagant subsidies to landowning.

>So a different explanation is called for, other than repitition of ye
>olde fact-free Georgist creed.

"Fact-free" would be a good description of a land price index that
shows real land prices not doubling in 100 years.

-- Roy L

Re: The real housing crisis is one of quantity

On Apr 19, 3:29 pm, Enough Already <enough alre...@lycos . com > wrote:
> The REAL housing crisis is that TOO MANY of them are being built every
> day, bad mortgages or not. Mindless overpopulation (75 million
> annually, worldwide) is treated as natural. Nature is treated as
> expendable.
>
> People go about their business, talking about money and investments,
> as if the land itself is infinite. They always claim there's "plenty
> of land" but won't say relative to what. Unaffected acreage decreases
> literally each second.
>
> * images.google . com /images?hl=en&q=human+footprint+map
>
> "Economic growth" means more people and less nature each day, with
> money creating a false measure of value in the process. A true housing
> "bubble" is an entire round hill covered with them.
>
> Real estate developers use money made from cannibalized land to
> cannibalize even more land. The word FINITE is missing from too many
> vocabularies.
>
> E.A.
>
> * enough already.tripod . com /
>
> Housing starts are a leading indicator of mindless growth.

E.A. Enough already. Take your dribble someplace else. You have a
long history is alt.planning.urban. You're a troll. And you're not
even good at that. Stop your cross posting. Better yet, stop your
posting.

Re: The real housing crisis is one of quantity

"Enough Already" <enough_already@lycos . com > wrote in message
news:4a93fe8d-8ba9-437c-bb73-d0ff1cb1238c@q27g2000prf.googlegroups . com ...
> The REAL housing crisis is that TOO MANY of them are being built every
> day, bad mortgages or not. Mindless overpopulation (75 million
> annually, worldwide) is treated as natural. Nature is treated as
> expendable.
>
> People go about their business, talking about money and investments,
> as if the land itself is infinite. They always claim there's "plenty
> of land" but won't say relative to what. Unaffected acreage decreases
> literally each second.
>
> * images.google . com /images?hl=en&q=human+footprint+map
>
> "Economic growth" means more people and less nature each day, with
> money creating a false measure of value in the process. A true housing
> "bubble" is an entire round hill covered with them.
>
> Real estate developers use money made from cannibalized land to
> cannibalize even more land. The word FINITE is missing from too many
> vocabularies.
>
> E.A.
>
> * enough_already.tripod . com /
>
> Housing starts are a leading indicator of mindless growth.

I like the thread so far. Only one stayed in the context you presented.
The other 2 went with the money synopsis thing, went somewhere else instead
of addressing the issues you presented. Kinda like politics.

See if I can even it out 50/50 for now (most won't address overpopulation
anyway, so its for now).

All our big problems are a of an ever increasing population nature. Both
nationwide and world-wide. The economy relies on a contigent of an ever
increasing population as starters. As population slows, the only
alternative is to take more from the current population. As the finite is
understood. Either way, we pay.
--
Dave

Hypocrisy. Big SUV, filament lights on all night. You think your neighbor
should be changiing to compact fluorescent light bulbs and driving the
hybrid.

Re: The real housing crisis is one of quantity

On Apr 19, 10:05 pm, "Dioclese" <NONE> wrote:
> "Enough Already" <enough alre...@lycos . com > wrote in message
>
> news:4a93fe8d-8ba9-437c-bb73-d0ff1cb1238c@q27g2000prf.googlegroups . com ...
>
>
>
>
>
> > The REAL housing crisis is that TOO MANY of them are being built every
> > day, bad mortgages or not. Mindless overpopulation (75 million
> > annually, worldwide) is treated as natural. Nature is treated as
> > expendable.
>
> > People go about their business, talking about money and investments,
> > as if the land itself is infinite. They always claim there's "plenty
> > of land" but won't say relative to what. Unaffected acreage decreases
> > literally each second.
>
> > * images.google . com /images?hl=en&q=human+footprint+map
>
> > "Economic growth" means more people and less nature each day, with
> > money creating a false measure of value in the process. A true housing
> > "bubble" is an entire round hill covered with them.
>
> > Real estate developers use money made from cannibalized land to
> > cannibalize even more land. The word FINITE is missing from too many
> > vocabularies.
>
> > E.A.
>
> > * enough already.tripod . com /
>
> > Housing starts are a leading indicator of mindless growth.
>
> I like the thread so far.  Only one stayed in the context you presented.=

> The other 2 went with the money synopsis thing, went somewhere else instea=
d
> of addressing the issues you presented.  Kinda like politics.
>
> See if I can even it out 50/50 for now (most won't address overpopulation
> anyway, so its for now).
>
> All our big problems are a of an ever increasing population nature.  Bot=
h
> nationwide and world-wide.  The economy relies on a contigent of an ever=

> increasing population as starters.  As population slows, the only
> alternative is to take more from the current population.  As the finite =
is
> understood.  Either way, we pay.
> --
> Dave
>
> Hypocrisy.  Big SUV, filament lights on all night.  You think your nei=
ghbor
> should be changiing to compact fluorescent light bulbs and driving the
> hybrid.- Hide quoted text -
>
> - Show quoted text -

Dave, love your Hypocrisy. Lets add home that consume 80-90% more
than they sould at present. With the progress of the buildign science
we should soon be able to easly get the net consumption to Zero.

Yes I do practice what I preach. I drive a hybrid, my electric bill
has been a -$100 each of the last 6 years (yes that is a minus). My
highest gas bill las winter was around $80 and that is at $1.49 a
therm (CCF). My house is a modest 1,500 sq ft for two people. Each
year I do another project to reduce our usage. Since the house is
built it gets harder to fix the rest of the items. In new
construction it would have beed easy and inexpensice to fix.

Andy

Think, Whole House Performance, it is the right thing to do....

Re: The real housing crisis is one of quantity

On Apr 19, 2:29 pm, Enough Already <enough alre...@lycos . com > wrote:
> The REAL housing crisis is that TOO MANY of them are being built every
> day, bad mortgages or not. Mindless overpopulation (75 million
> annually, worldwide) is treated as natural. Nature is treated as
> expendable.

What housing crisis are you writing about?

Your Malthus style arguments never did reflect reality. Many European
countries aren't having a reproductive rate that is sufficient to
sustain their population.

--
Ron

Re: The real housing crisis is one of quantity


"Enough Already" <enough_already@lycos . com > wrote in message
news:4a93fe8d-8ba9-437c-bb73-d0ff1cb1238c@q27g2000prf.googlegroups . com ...
> The REAL housing crisis is that TOO MANY of them are being built every
> day..

Depends which country you are in.

Here in the UK we can't build houses fast enough. The government won't
release land for building, so prices are sky high and people need to borrow
a large multiple of their salary to afford one. Agricultural land (without
permission to build a house) sells for perhaps $20,000 a UK acre compared to
perhaps $2,000,000 an acre for land with permission to build houses.

Re: The real housing crisis is one of quantity

On Apr 19, 3:29 pm, Enough Already <enough alre...@lycos . com > wrote:
> The REAL housing crisis is that TOO MANY of them are being built every
> day, bad mortgages or not.

I disagree.

It's not how many
but what type of housing.
It's part of a built in market inefficiency
There are plenty of houses for the very rich.
However, there are very few options for the working poor.
Because there is a higher profit to be made making housing for the
very rich
all the builders made houses for the very rich.
Because there is a very low propfit for making housing for the working
poor
all the builders avoid making housing for the average working stiff.
Unfortunately this led to a glut of overpriced homes
because the world doesn't have enough rich people
and a lack of affordable homes
for the average working family....
this environment encourages/forces average family into a
housing market where they must +buy up+ to afford housing
often forcing them to extend their credit to buy a
place to live...this inturn creates a financial market
full of risky instruments. All it takes is inflationary pressures
or a a recession to cause these risky instruments to fail
en mass. -

Re: The real housing crisis is one of quantity

Can you support your points below, or are you just throwing out you opinion?

"drydem" <walter_lee@my-deja . com > wrote in message
news:00774819-a011-4312-92c8-8e564e14e876@a23g2000hsc.googlegroups . com ...
On Apr 19, 3:29 pm, Enough Already <enough_alre...@lycos . com > wrote:
> The REAL housing crisis is that TOO MANY of them are being built every
> day, bad mortgages or not.

I disagree.

It's not how many
but what type of housing.
It's part of a built in market inefficiency
There are plenty of houses for the very rich.
However, there are very few options for the working poor.
Because there is a higher profit to be made making housing for the
very rich
all the builders made houses for the very rich.
Because there is a very low propfit for making housing for the working
poor
all the builders avoid making housing for the average working stiff.
Unfortunately this led to a glut of overpriced homes
because the world doesn't have enough rich people
and a lack of affordable homes
for the average working family....
this environment encourages/forces average family into a
housing market where they must +buy up+ to afford housing
often forcing them to extend their credit to buy a
place to live...this inturn creates a financial market
full of risky instruments. All it takes is inflationary pressures
or a a recession to cause these risky instruments to fail
en mass. -

Re: The real housing crisis is one of quantity

On Apr 21, 8:03 pm, "Matt W. Barrow" <mbar...@performancehomes . com >
wrote:
> Can you support your points below, or are you just throwing out you opinio=
n?
>

Oh no!
I hope you don't think I'm ranting... (9 9)

My points are an empircal observation. I'm involved in
urban planning and local governing affairs

I occassionally testify at government hearings as well....


Locally builders have been able to opt out of building
affordable housing units ( until recently) by paying into
Affordable housing Fund. Developers could make much
more money by just opting out of building affording
housing units. However, the fund generated by this opt out
fee has never been enough for the local government to build
any new affordable housing projects/complexes ( especially with
rising land prices and higher construction cost). Since new
affordable housing units are now even more costlier to make
than in the past -- builders when they do make them also
can only make a few of them. Thus there hasn't been much
in additional affordable housing construction in my county
for about 20 years. Only recently the law was revised such that
builder/developers are now required to build Moderatedly Priced
Dwelling Units (MPDUs) and may NOT opt out -- but since
new construction permits has gone bust - this might
be a case of closing the barn door after the cows
have left.


At the local level, I've also witnessed
residents from local communities resist the inclusion
of MPDUs near their communities because they fear it would
decrease the value of their homes.


The lack of new affordable housing construction would not be
such a severe problem if it weren't for the lost of current
affordable
housing. The currently the bulk of affordable housing consist
of local apartment complexes but the current housing/real estate trend
has been of the conversion of these apartments ( which have
affordable rents) to luxury condos (which require a large amount of
capital but have high monthy fees) . So you not only have the
failure to create an adequate supply of new affordable housing
units but you have the lost of existing affordable housing units.
Luxury condos provide a higher profit margin than affordable
co-ops - So Co-ops are not very popular here. One of the
initiatives being advocated recently here is to stop the loss
of older affordable housing units by using the affordable housing
fund to buying apartments that provide affordable housing units
that would otherwise be converted into condoniums.


While housing cost have dropped - they are still very high
especially when considering the interest being charge
on the mortgage. It seems to me that the people
who have (re)financed their homes in my region in
the last 3 years who are mainly at risk with respect
to this currently troubling financial climate. I've heard
that atleast some of the current troubles have to do
with loans generated by mortgage brokers and
the lack of verification( of financial data by) financial
institutions. The main reason for this financial subterfuge
is to make a mortgage/home affordable (or appear to
be more affordable ).


I've notice in my community that most of the
housing assistance has gone to single parent families,
e.g. a mom with atleast one child. I've also notice that
many households in my locale ( the Washington DC
Metro Areas ) often solve the demand for higher
housing cost by having multiple earners.





> "drydem" <walter ...@my-deja . com > wrote in message
>
> news:00774819-a011-4312-92c8-8e564e14e876@a23g2000hsc.googlegroups . com ...
> On Apr 19, 3:29 pm, Enough Already <enough alre...@lycos . com > wrote:
>
> > The REAL housing crisis is that TOO MANY of them are being built every
> > day, bad mortgages or not.
>
> I disagree.
>
> It's not how many
> but what type of housing.
> It's part of a built in  market inefficiency
> There are plenty of houses for the very rich.
> However, there are very few options for the working poor.
> Because there is a higher profit to be made making housing for the
> very rich
>   all the builders made houses for the very rich.
> Because there is a very low propfit for making housing for the working
> poor
>   all the builders avoid making housing for the average working stiff.
> Unfortunately this led to a glut of overpriced homes
>     because the world doesn't have  enough rich people
>  and a lack of affordable homes
>      for the average working family....
> this environment encourages/forces average family  into a
>    housing market where they must +buy up+ to afford housing
>   often forcing them to extend their credit to buy a
>     place to live...this inturn creates a financial market
> full of risky instruments. All it takes is inflationary pressures
> or a a recession to cause these risky instruments to fail
> en mass. -