Well, they're doing something right when a median home costs $272k compared to the $1.5m one needs to live in the Bay Area growing up here.
You can get a house for $75k (median) if you want in Gary Indiana. I'm not sure how lower housing prices can be directly correlated with "doing things more right".
it's a bit like someone arguing that Land Rovers are bad cars because they are built poorly, and then someone else coming in and saying well at least they don't cost the amount that a lamborghini costs, they must be doing something right. and then a third person coming into that argument and saying "well, actually you can't use price because a bicycle costs 200$ and that doesn't mean a bicycle is better than a Land Rover based on price alone" ...the point they're driving could be correct, but the comparison is apples to oranges. you can't compare bicycles to cars to drive the point, just like i wouldn't use Gary to make the argument that low prices does not mean a thriving city. a better argument would be to use something that is comparable to a Land Rover (Houston) like say, a car that is within 10-20k range that does the job but is still largely a piece of crap to argue your point that price alone doesn't dictate success.
There are tons of places with very cheap housing and no jobs. Nobody moves there except maybe a few teleworkers looking to optimize hard for surplus or people with other reasons to go there like family ties.
* Economy comes and goes with natural resource boom bust cycle.
* America's most obese city
* A huge sprawl with bad traffic and poor public transportation
There are other cities that match some of those qualities that I don't much care for, but I can see why a lot of people wouldn't mind and go for the cheap housing there as a decent trade off.
But in my original comment, my only point was that you can't judge how great a city is based on how cheap its real estate is (and the correlation often goes the opposite way).
I think you're imagining all Houston real estate as cheap/affordable, when in reality the city has lots of extremely expensive real estate. It just also has affordable housing due to widespread construction of townhomes, apartments, and condos. Something like Gary just isn't comparable.
I wonder what sinking into the Gulf of Mexico is going to do for property values.
I'm not sure how the criteria are different, the above is looking at big cities. The other list seems to have a bunch of small cities (e.g. Jackson MS). The difference could also be in study year. Neither list is very surprising to me.
> * A huge sprawl with bad traffic and poor public transportation There are only a few cities in the U.S. that have good public transportation and while it's really nice it's also super expensive to live there.
Look there is no reason to live in Houston if you're rich. It's much nicer to live in a prettier city with great public transit and driving distance from some amazing natural features.
But if you're not rich and you want to be able to raise a family, own a house, and experience nice entertainment on 50k a year, Houston is a wonderful city.
Are you kidding? Its easily worth twice that. Wait until I show you the upgrades, new paint and wall to wall carpet. The bathroom's been renovated with new fixtures, and that is genuine imported Mexican tile. You'd be a fool to pass on this. Just think of the possibilities.
The 9 county area of the Bay Area is 7000 square miles... and that includes a lot of land that you can't reasonably build a city on.
If you take the land area of the cities in the Bay Area ( https://en.wikipedia.org/wiki/List_of_cities_and_towns_in_th... ) and sum them all up, you've got something on the order of 1,600 square miles.
The land constraints within the Bay Area contribute significantly to the price of a house.
Pave every single square foot of the nine counties that make up the Bay Area including Marin, Sonoma, and Napa... and you're still 3,000 square miles short of the greater Huston area.
That said, Tokyo, which is a wonderful city to live in, and on more earthquake prone land, has 14 million people on 5,194 square miles: https://en.wikipedia.org/wiki/Tokyo.
To me, human homes is one of the most worthy uses of land.
Of course, it would be nice if you could keep everything you're doing right and bring housing prices down (largely by building more of it). But on the whole real-estate being valuable is generally a positive sign.
On the flip side, the cheapest houses you could find for awhile (maybe still?) were in detroit, that's not a sign that Detroit was doing well - but that demand had plummeted to literally 0 because it was doing so poorly.
For instance: nice homes in very low demand areas may sell for large amounts of money and only have a single offer.
One is that we're really talking about demand from people who can afford it. All the demand in the world from people living on minimum wage won't drive house prices up so they aren't really "counted" in my analysis. There's not really a way to fix this issue with the data, but I'd argue that demand from reasonably rich people is still a good sign. Indeed, rich people are the most mobile and able to move away from a shitty place to live.
The other is that the quality of the home matters (a lot). Which is completely true, but the cheap shitty homes in the bay area are still demanding these prices, so I'm not sure it really applies to the concrete situation being discussed even though it is an issue with my general argument. You could maybe try and find "comparable" homes in different places to try and account for that, but I have no doubt doing so would open you up to issues with bias (intentional or otherwise).
These houses and the areas they occupy (i.e Beverly Hills, Park Ave ) are an extreme edge case, and don't exist in the same housing market as normal houses.
Above a certain very high price percentile, there are always very few buyers and sellers, and they are all paying a high premium for things like high physical security.
I think you have used circular reasoning here. The price is ultimately governed by supply and demand. They are expensive because more people demand them than the supply available for sale. There are many reasons why demand can exceed supply, like development restrictions, difficult building environments.
That's no different in a pretty rural area or in a place like the bay area. The extremely pretty and expensive rural areas (think luxury ski towns) control housing development even more strictly than expensive cities. The bottom line is desirability, which manifests as demand.
And, if you're paying $1M+ for a house in the rural plains, it's probably far bigger than the typical house, because the land is very cheap.
You may have a piece of property that only one person in the world wants to live on, but if you get a single buyer willing to give you a million bucks, you have a million dollar property.
Meanwhile, 100 people might want to live in a particular property in a ghetto, but none of them have a million dollars to bid on it. The price will only raise to the maximum amount that the buying pool can afford. More demand doesn't result in higher prices, it results in homelessness and/or people moving to alternate markets.
My point is that $1.5m prices are not a signal that a ton of people want to live in a particular place. It's a signal that people who can obtain $1.5 million dollar loans want to purchase there, and that the demand satisfies the motivated supply. That's it.
I don't know where you are referring to but there is reams of historical data that demonstrates that more demand without an increase in supply leads to all 3 of those.
> My point is that $1.5m prices are not a signal that a ton of people want to live in a particular place.
Yes, and $1.5M in isolation is a meaningless number and not a signal of anything at all without describing what exactly it buys you.
What does signal desirability is the trend line in property prices in a given area and the relative price of equivalent properties in different areas.
That is, sure, houses are cheap for now. But that doesn't mean you will have a place worth living in, given time.
13 million people living in the Los Angeles basin seem to disagree.
So the ability to sustain/tolerate sprawl seems far higher than we expect.
https://cdn.nar.realtor/sites/default/files/documents/metro-...