Moral imperative for a housing crash... and permanent devaluation

[ygolo]

First of all, this is not a prediction. Instead, I'm stating it's a morally good thing for houses to be inexpensive permanently.

Additionally, we live in the current world with the way it is currently incentivized. I am guilty of all the stupidity and immorality as I am argue here. I am a homeowner in the suburbs and own more than I need-a complete hypocrite.

But, I urge that responses that argue that is not in fact morally good for housing to be very inexpensive to use something other than hypocrisy as the counter.

A better version of ourselves practically necessitates that the current version is hypocritical with respect to new ideals.

Benefits
1. Reduced homelessness. When it costs less to give people homes, it takes less to do that. Almost a tautology.
2. Reduced poverty. The vast majority of "wealthy" people have the majority of their "wealth" in their homes. But the main productive value a home is that it provides for people is shelter. The excess beyond shelter(and some comfort), takes land away from farming, forest land, and other means of productive use of space. If the basics were affordable for everyone, the extra, especially if there's little speculative gain in exchangeable value, will be seen as the narcissistic and wasteful flex that it is. All the other things people exchange their money for will gain where housing loses.
3. Reduced pollution. The most wateful way to live is suburbia. Rural areas when cultivated well produce food. Due to density, cities actually have less pollution per capita(and can be reduced further if mix use could create shorter or no commutes), and undeveloped land is great if reforested.

Useful concepts
1. We can see inflation as a list of numbers instead of a single number. I know we're trained by the media to think of it as one abstract number. But in our day to day life, if my wife and I like a particular milk for a combination of health and taste reasons, we're not going to suddenly switch to a substitute. Each thing we regularly buy has it's own change in price. This includes what we pay for shelter. For most people, this means paying either a rent or a mortgage. At one time, when cars were new, they were more expensive than houses. Now houses can go for 10 times what cars go for. Financial experts now call cars "financial napalm" but consider houses part of a diversified portfolio. Interestingly, even though most people don't think of it this way, we pay exponentially less every couple years for transistors (in the form of electronics)
2. Socially sustained exponential decreases in price exist. The most famous of these is known as Moore's law (the exponential decrease in the cost of transistors). But it must be stressed that this is not a law of physics. It is a collective goal sustained by increasing efforts (see Moore's Second Law) in the face of hurdles put up by the laws of physics. They may fail at any point, and people point to evidence it's slowing. There are others, like the exponential drop in cost of sequencing a human genome. Why don't we make collective goals enlisting humanity's creativity to exponentially lower the costs of basic needs like food and shelter?
3. We know how to build vertically. It's out of favor now because density also brings traffic and could potentially strain resources. But these limitations could be designed around. Future cities could be much better than current ones. Suburbia could also become more dense.
4. Mix use land may be more productive. Trump bragged about how he lived and worked in the same building in the Art of the Deal (I am no Trump fan, but I take ideas from everyone). Imagine if the same area is used for power production, green sections for photosynthesis and recreation, housing, shopping, farming, and business...like a city in a building. Would that be possible?
5. NIMBYs. I feel sorry for people named Karen. I'm not sure why that's the name picked for people causing significant inconvenience, if not harm, for others simply to get their whims met. I think a better name would be a NIMBY-which stands for not in my back yard. I understand raising legitimate concerns about various things. But instead of voicing concerns and allowing people to address the plans, often they go into blocking a project mode before the project even takes shape.
6. People make fun of status seekers and speculators in one domain but not others. It's easy to make fun of someone who paid ridiculous amounts of money for a bored Ape NFT, but there are pieces of modern art I don't get either. We make fun of people owning virtual pieces of metaverse real estate, but applaud people getting way more home than they'll ever need in the real world. The difference is the real world extra is eating a lot more resources than the virtual nonsense(even though it eats resources also). I'm not advocating the hype around the metaverse and NFTs. I am pointing out that this stupidity happens already in the real world. Buying exhorbitantly for the status is there for NFTs as well as for the extra of a house. Waisting tons of the world's resources buying because you are hoping for the price to go up happens both with bitcoin as well as with the extra of a house.

 

[Virtual ghost]

For me this is none brainer. The only amorality in cheap but functional housing is when they are so cheap that workers aren't paid enough when they build them or make material for them. Every normal human being needs a home and probably the most things that come with it. Without that you will surely have large scale social-economic disaster when the system starts to wobble enough over time.

 

[Indigo Rodent]

Housing must be a human right and there must be standards of safety and ability to have peace and quiet without others polluting it with noise. Currently living in apartment block. One constantly depends on usually non-existent goodwill of neighbors.

 

[Julius_Van_Der_Beak]

Housing must be a human right and there must be standards of safety and ability to have peace and quiet without others polluting it with noise. Currently living in apartment block. One constantly depends on usually non-existent goodwill of neighbors.

I knew a guy once that was so bothered with noise he wanted to find and set off a nuke in his own neighborhood so there could finally be peace and quiet. He wasn't successful but it scared a lot of people away.


Even as an introvert who appreciates quiet I thought that was extreme.

Also many of the people left hanging around in the neighborhood were neo-nazis. Appreciated the cheap real estate I guess.

 

[ygolo]

Housing must be a human right and there must be standards of safety and ability to have peace and quiet without others polluting it with noise. Currently living in apartment block. One constantly depends on usually non-existent goodwill of neighbors.

I hear a lot of more from my neighbor than I would like, but I've stayed with people in multistory dwellings in other countries where the noise hasn't been a problem. I've also noticed that noise hasn't been an issue in many hotels I've stayed in the US as well.

I didn't think about what makes good sound proofing vs not. It seems a lot of places get it right though.

 

[ygolo]

How can the learning curve become part of the thinking behind housing costs?

The learning curve is a key factor in many of the socially sustained exponential decreases in cost.

There's an old learning curve calculator that's useful for this thought process:

https://web.archive.org/web/20120830021941/http://cost.jsc.nasa.gov/learn.html

You can enter whatever numbers you want (scroll down to see the calculator)

There are many versions of the learning curve that we could use, but the one I am focused on is Wright's law of exponential decrease in cost of the next unit based on the number of units produced.

There is a progress ratio associated with this law.
https://en.m.wikipedia.org/wiki/Experience_curve_effects
There is one published for ship building, which in my mind seems similar to home building. It is about 85%. The world has produced over a billion housing units. The numbers plugged in to the model generate wildly wrong costs.

One could claim that the key component of housing is land which is not subject to learning. But we can build vertically, and thinking out of the box, people can even live on ships.

The reasons for the learning curve given include:

• Labor efficiency: Workers become physically more dexterous. They become mentally more confident and spend less time hesitating, learning, experimenting, or making mistakes. Over time they learn short-cuts and improvements. This applies to all employees and managers, not just those directly involved in production.
• Standardization, specialization, and methods improvements: As processes, parts, and products become more standardized, efficiency tends to increase. When employees specialize in a limited set of tasks, they gain more experience with these tasks and operate at a faster rate.
• Technology-driven learning: Automated production technology and information technology can introduce efficiencies as they are implemented and people learn how to use them efficiently and effectively.
• Better use of equipment: As total production has increased, manufacturing equipment will have been more fully exploited, lowering fully accounted unit costs. In addition, purchase of more productive equipment can be justifiable.
• Changes in the resource mix: As a company acquires experience, it can alter its mix of inputs and thereby become more efficient.
• Product redesign: As the manufacturers and consumers have more experience with the product, they can usually find improvements. This filters through to the manufacturing process. A good example of this is Cadillac's testing of various "bells and whistles" specialty accessories. The ones that did not break became mass-produced in other General Motors products; the ones that didn't stand the test of user "beatings" were discontinued, saving the car company money. As General Motors produced more cars, they learned how to best produce products that work for the least money.
• Network-building and use-cost reductions (network effects): As a product enters more widespread use, the consumer uses it more efficiently because they're familiar with it. One fax machine in the world can do nothing, but if everyone has one, they build an increasingly efficient network of communications. Another example is email accounts; the more there are, the more efficient the network is, the lower everyone's cost per utility of using it.
• Shared experience effects: Experience curve effects are reinforced when two or more products share a common activity or resource. Any efficiency learned from one product can be applied to the other products. (This is related to the principle of least astonishment.)

Ultimately, I think it comes down to expectations and demand.

Imagine if individual transistors, once invented, were given some speculative value as an asset that was expected to appreciate, would we have anything resembling the internet and all the power of computing we see? Or would we have individual artistic bespoke marvels that individual owners keep around as collectors items?

I know people love their homes, but beyond shelter(including warmth a place for your property) for yourself and your loved ones, how much more is needed?

 

[Patches]

I would argue that included in this list (or hand-in-hand with this list) needs to be the imperative that we need to be building more housing. In the US, at least, there are far too many 'veto points' in our legislation that gives NIMBYs the opportunity to shut down housing developments, especially high density housing. Part of the problem causing the inflation of housing prices is that we simply aren't building enough at a sufficient pace.

The homelessness crisis is deeply disturbing, and worsening. Housing people affordably resolves SO many other social problems and ultimately is the cheaper option than dealing with the fallout of having masses of homeless everywhere. I'm fully on board with affordable housing being a necessity for both ethical and practical reasons.

 

[ygolo]

I would argue that included in this list (or hand-in-hand with this list) needs to be the imperative that we need to be building more housing. In the US, at least, there are far too many 'veto points' in our legislation that gives NIMBYs the opportunity to shut down housing developments, especially high density housing. Part of the problem causing the inflation of housing prices is that we simply aren't building enough at a sufficient pace.

The homelessness crisis is deeply disturbing, and worsening. Housing people affordably resolves SO many other social problems and ultimately is the cheaper option than dealing with the fallout of having masses of homeless everywhere. I'm fully on board with affordable housing being a necessity for both ethical and practical reasons.

Yup. Massive supply of affordable housing, especially "starter" homes (even if not single family), is what I was thinking.

For some reason the learning curve isn't there for home supply even though we've been making homes as human beings since ancient times, we're not currently ridiculously efficient at it.

We do flimsy balloon home construction in most of the US, which seems less labor intestive than many other countries (though I suppose Japan has even more disposable housing), but it's still ridiculously expensive.

 

[Virtual ghost]

I would argue that included in this list (or hand-in-hand with this list) needs to be the imperative that we need to be building more housing. In the US, at least, there are far too many 'veto points' in our legislation that gives NIMBYs the opportunity to shut down housing developments, especially high density housing. Part of the problem causing the inflation of housing prices is that we simply aren't building enough at a sufficient pace.

The homelessness crisis is deeply disturbing, and worsening. Housing people affordably resolves SO many other social problems and ultimately is the cheaper option than dealing with the fallout of having masses of homeless everywhere. I'm fully on board with affordable housing being a necessity for both ethical and practical reasons.

From what I have noticed there are huge parts of US that are simply abandoned and in evident disrepair. Therefore fixing that is probably an easy way how to quickly ease this problem. There are whole cities that are half empty at this point.

 

[ceecee]

From what I have noticed there are huge parts of US that are simply abandoned and in evident disrepair. Therefore fixing that is probably an easy way how to quickly ease this problem. There are whole cities that are half empty at this point.

There is SO much space in this country it's obscene. The downside to using those places that are in disrepair or abandoned is that no one wanted to live there for some time or even at all. Environmental reasons, crime, lack of jobs, whatever. There are places in Detroit (I'm there in neighborhoods almost daily) where one street is ok, the next one looks like a bomb hit it. And homeowners pay high property taxes and utility costs. This isn't a party thing. It's certainly not the majority that wants to live like that - they deal with illegal dumping, vacant burned out houses that sit for years attracting crime and rodents, lack of ANY kind of functioning infrastructure (flooding every time it rains, power out for days and weeks due to trees and decaying poles and lines), exorbitant water and sewer charges for extra lots on top of taxes already paid...I can go on and on. And people in rural areas experience the same sort of things but they think they can escape the police state the cities live in. They can't.

The continuation of living in a psychotically individualistic country, with people rationalizing the most selfish possible choices every day is a big reason why this continues. Either that mentality changes or this gets worse than anyone can imagine.

 

[Virtual ghost]

There is SO much space in this country it's obscene. The downside to using those places that are in disrepair or abandoned is that no one wanted to live there for some time or even at all. Environmental reasons, crime, lack of jobs, whatever. There are places in Detroit (I'm there in neighborhoods almost daily) where one street is ok, the next one looks like a bomb hit it. And homeowners pay high property taxes and utility costs. This isn't a party thing. It's certainly not the majority that wants to live like that - they deal with illegal dumping, vacant burned out houses that sit for years attracting crime and rodents, lack of ANY kind of functioning infrastructure (flooding every time it rains, power out for days and weeks due to trees and decaying poles and lines), exorbitant water and sewer charges for extra lots on top of taxes already paid...I can go on and on. And people in rural areas experience the same sort of things but they think they can escape the police state the cities live in. They can't.

The continuation of living in a psychotically individualistic country, with people rationalizing the most selfish possible choices every day is a big reason why this continues. Either that mentality changes or this gets worse than anyone can imagine.

The bold part is what I also include in "repairing the place".
But you are right this requires moral and educational reform as well. This is more complex than just fixing buildings. However there are so many rotten places in US at this point that you don't really need to build that many new places. Just fixing what you have as well as some laws should fix most of the problem. I mean fixing is usually much cheaper if the place isn't beyond repair.

 

[ceecee]

The bold part is what I also include in "repairing the place".
But you are right this requires moral and educational reform as well. This is more complex than just fixing buildings. However there are so many rotten places in US at this point that you don't really need to build that many new places. Just fixing what you have as well as some laws should fix most of the problem. I mean fixing is usually much cheaper if the place isn't beyond repair.

I think you have posted videos from this channel before I would really urge any American to start familiarizing themselves with laws like this. It's been the case for a century.

The video is about a Toronto neighborhood but it's applicable in the US too. Our daughter lives in St. Paul MN and there are still walkable neighborhoods with restaurants, bars, businesses, libraries... on the corner or down the street from her house. And when you visit, there are people out, no matter the time of year. It looks alien to people who have never seen or lived in an older urban area but it's what I would like to see everywhere. Suburbs don't need to be as hellish as they are but people need education on the matter.

 

[Virtual ghost]

I think you have posted videos from this channel before I would really urge any American to start familiarizing themselves with laws like this. It's been the case for a century.

The video is about a Toronto neighborhood but it's applicable in the US too. Our daughter lives in St. Paul MN and there are still walkable neighborhoods with restaurants, bars, businesses, libraries... on the corner or down the street from her house. And when you visit, there are people out, no matter the time of year. It looks alien to people who have never seen or lived in an older urban area but it's what I would like to see everywhere. Suburbs don't need to be as hellish as they are but people need education on the matter.

Yes, I posted some videos from there.

I always knew that there is something physically strange about most of US but I never managed to quite pinpoint it. Until I recently found out that this is pretty awkward city planning.

 

[ygolo]

There is SO much space in this country it's obscene. The downside to using those places that are in disrepair or abandoned is that no one wanted to live there for some time or even at all. Environmental reasons, crime, lack of jobs, whatever. There are places in Detroit (I'm there in neighborhoods almost daily) where one street is ok, the next one looks like a bomb hit it. And homeowners pay high property taxes and utility costs. This isn't a party thing. It's certainly not the majority that wants to live like that - they deal with illegal dumping, vacant burned out houses that sit for years attracting crime and rodents, lack of ANY kind of functioning infrastructure (flooding every time it rains, power out for days and weeks due to trees and decaying poles and lines), exorbitant water and sewer charges for extra lots on top of taxes already paid...I can go on and on. And people in rural areas experience the same sort of things but they think they can escape the police state the cities live in. They can't.

The continuation of living in a psychotically individualistic country, with people rationalizing the most selfish possible choices every day is a big reason why this continues. Either that mentality changes or this gets worse than anyone can imagine.

It's not just in the west. China is notorious for ghost cities, also. It's seen by many wealthy people as just a means to own more property, even if nobody lives there.

China has at least 65 million empty homes — enough to house the population of France. It offers a glimpse into the country's massive housing-market problem.

In the US and Japan, abandoned homes have earned cities the titles of "ghost towns." But China's are different — they're not abandoned, just empty.

www.google.com

I've heard from people that a lot of these new buildings in ghost cities aren't even livable (for example, no plumbing)

It seems like a massive misallocation of resources to simultaneously have people priced out of homes and also having so much undesirable/unlivable space.

 

[Virtual ghost]

Some thoughts on the issue.

 

[The Cat]

America sure seems to love having their homeless. They make such effective object lessons as to why we must obey our masters without question, and not raise too much of a fuss in the work place.

Because in America, you could have anything you wanted, just as long as you could pay for it. If you couldn't pay, or refused to pay, you would remain needful for ever.

 

[ygolo]

There's an interesting article on Houston and San Diego's approaches to homelessness:

Two cities tried to fix homelessness, only one succeeded

Housing First is considered a best practice for addressing homelessness, but where one city succeeded, another still struggles. A surge in pandemic homeless aid will help, but experts say only with strategic planning.

cronkitenews.azpbs.org

San Diego's housing is so expensive that the city probably couldn't even try the permanent solution if it wanted.

The principle shows up in research enough that I feel like it should at least be tried everywhere where problems are bad. Just give money to the poor, and housing to homeless (which now affects people who traditionally wouldn't have counted as poor as well).

 

[ygolo]

I'm always skeptical of people seemingly doing green projects and addressing affordability. If there's one industry that'll exploit good will to gain funding and underdeliver on promises (well meaning or not) it's real estate.

Net Zero Seattle High-Rise Saves on Construction, Builder Says - Environment+Energy Leader

The companies behind a new high-rise apartment building in Seattle hope to prove that constructing a net-zero energy building can be faster and more affordable than traditional building. The building is going up with new technology that makes construction faster, more affordable, and far more...

www.environmentalleader.com

There's nothing in principle that would make this project impossible. It's close to their purported time of occupancy. I do hope this is real, though.

But real estate and energy are talked about in circles as being the most duplicitous sectors of the economy (though the new "web 3" may be the clearest center of fraud). Even if the principal actors were well meaning, one wonders if they'd be able to cut through all the lies and fraud of the industries.

Edit: Despite my cynicism, these are the very type of projects I'd like to see and even participate in. Similar to web 3 and it's ideals, I'd be excited about it if there wasn't hype around these projects(and rampant fraud that goes along with hype even among well meaning actors)

 

[ygolo]

People have been thinking about the lack of collective learning curve in housing before (unsurprisingly):

Where are my damn learning curves?

A phenomenon that shows up repeatedly in a variety of production operations is the learning curve. Essentially, the learning curve (also called the experience curve, or the progress curve) is the observation that production efficiency tends to improve at a fairly regular rate - every doubling of...

constructionphysics.substack.com

The resetting of learning curves happen upon new models...again it makes me think about the creation of bespoke art projects to fulfill a basic human need, rather than providing for people at exponentially lower costs while allowing the individual homeowners to do they homey customization.

 

[Virtual ghost]

In my opinion all of this is among other things linked to the fact that typical American stares to the screen objectively too much. Modern people in general have kinda forgotten how physical reality looks like and how to engage it. While previous generations had more time and opportunity to engage in what is "community maintenance". What kinda made many places livable or affordable. While today many places have rotten to the point that no one wants to live there. Since the community collapsed.