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Comment by ixacto | Hacker News Reader

Yes housing is not in accorandce with the construction costs. Essentially you have inflated bureaucracy and artificial supply constraints & zoning (NIMBY) trying to keep the housing prices up.

Houses are just fine in Boise, ID or Albany, NY but so much cheaper than the coasts. This is really frustrating, and I don't see a politicly workable solution. So spend 50% on rent or move to Idaho...

None of this is even considering that we may be able to substantially lower construction costs with prefabricated/3d printed homes/economies of scale.

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Along with the sibling replies, maybe this is just part of the natural cycle of things. People will make Boise the new Austin. Prices will rise, demand for better infrastructure increases, things improve. A generation is raised. Their children move on to the next few smallish cities and bring them up to spec. As a lifelong resident of a city in seemingly permanent decline (St. Louis), it sounds good to me.

In the UK we left it to the free market for the last 30 years and the market completely failed to meet demand.

Admittedly there were some planning constraints but even as those have been lifted the developers continue to make large expensive homes rather than the dense housing we desperately need.

> developers continue to make large expensive homes

Correction - developers continue to make expensive homes. I'm about to move in to a studio in east London for £1400 per month plus utilities, estimated total of £1650 per month. It's a ~40 story residential tower, so from the point of land footprint it's as densely populated as it gets.

Boise is the fastest growing city in the US, with attendant increase in housing cost. Prices aren't completely crazy yet, but my house is worth 65% more than what I paid for it, and is increasing by the year at too large of a rate.

This was a good place to move to, now not so much.

> Prices aren't completely crazy yet, but my house is worth 65% more than what I paid for it, and is increasing by the year at too large of a rate.

Just an anecdote, but in India this rate of growth is expected. People expect their property to fetch double returns in 3-5 years. My parents bought an apartment for ₹1.5M, we lived there for about 7 years and it sold for ~₹6M.

Me and my wife are planning to purchase our own now and we factor this growth expectation into our calculations.

If prices are rising rapidly, speculation occurs distorting supply and demand needs. Then the bubble goes "pop" and the process starts again.

So when prices stop being volatile, will you win or will you lose?

It's not a bubble if the economy is growing at the same or faster rate, though.

It's not a bubble until it is. Supply and demand must be considered besides money supply.

For those who think "real estate" is a sure bet to high returns, we've been there and done that before, even for emerging economies. If you really want to know, look at home rents vs. home purchase prices, those will never lie.

True enough, but is your part of India experiencing much faster growth than the country at large? Because the Indian GDP growth rate seems to be hovering fairly stably around 7%.

I think you're right. My family doesn't stay in one place for more than 7-8 years. We always move to wherever there are better jobs, etc. So my "part" of India is wherever there is most growth.

Are wages increasing at the same rate? Or is the new wealth just flowing to the already rich?

https://m.economictimes.com/jobs/india-to-have-highest-salar...

Average salary increase of 10% sounds like it somewhat answers what you were asking.

Here's another relevant tidbit:

https://www.livemint.com/Money/5wpK2P8H02D3ujDFYHzfBI/Number...

Anecdotally, in my company, an annual salary bump of just 10% is considered a punitive action.

Edit: looks like the wealthy are getting more wealthy and the poor are getting more wealthy, but not as much.

If the economy is growing faster than 6% a year, you probably want to buy some stock!

For sure!

I had a feeling it was just a matter of time before Boise set a course to become the next Austin. One visit 5-6 years ago for a few days to interview at a tech company, and I thought, “Huh, Boise is pretty damn cool.”

In winter, you'll think, "Boise is pretty damn cold."

Boise gets down to around mid-20s (F) in the winter, which isn't that cold. Humidity is also pretty low, so it tends to feel quite crisp.

Isn't Boise going to be similar to SLC in climate? I mean, no huge lake, but it seems like everything else is very similar.

With the exception of last year, my heater only runs 3 months a year, and not very often at that.

Yea. Real people, cool people, people that cared about each other. Now Boise has already become attractive to move to. It's sad. Dread the day when Boise becomes cool. That's when all the phonies and psychopaths show up.

A cursory Google search indicates there are Indian savings accounts that return 7%. That would be a pretty good year in the stock market over here.

Also factor in a nearly 4.5% inflation rate...

IIRC India has a huge cultural preference for storing wealth in gold. Indian banks probably have to pay high rates to attract capital.

Getting 7% isn't that hard in other parts of the developing world that don't have a preference for gold.

It hurts a bit seeing a saving account that has better performance than my risky equities investments.

But those currencies devalue a lot, devalue often. You are making wealth by storing USD cash. Maybe GBP not so much after brexit.

Construction costs for basic structures are already quite low, especially for large new developments with many similar units. More prefabrication could help but it would be a marginal improvement. The real costs are for land acquisition and construction permits.

Id separate houses from land. Its probable that housing as a construction is not that much higher than the cost of bulding it. Land is where prices go up without individual investment.

It'll go up in Idaho, too, when supply dries up. Won't it?

"Move to Boise. There aren't too many people yet!"

> I don't see a politicly workable solution

The workable political solution, IMO, is to the solve the problem at the state or federal level.

Or in other words, just make a law that overrules all of the local restrictions that exist, and tell the NIMBY cities to go suck it.

A city might have enough votes within its own borders to put up these rules and regulations, but they have much less of a chance of outvoting either the state or the nation as a whole.

Who will win an election with that platform? Foreigners and renters do not have the political clout.

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