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Comment by rootusrootus | Hacker News Reader

With such little regulation, I would have guessed housing supply would be really great and prices quite affordable. But the Houston metro area is barely below the national median for house prices.

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> But the Houston metro area is barely below the national median for house prices.

That seems unsurprising, and not sure it's a good metric. Houston is certainly much cheaper than, for example, Austin, and my guess is that it is considerably cheaper than similar sized metros.

I can't find it right now, but I remember reading an article from a few years back that basically called Houston the best city to live if you are poor. That is, don't just look at median prices, but Houston actually has a ton of affordable housing that is simply non-existent (or highly restricted in stupid lottery games) in other cities.

This is mostly accurate from what I've seen, but if you were willing to go as far out from the Austin city center as Houston's natural sprawl goes, you would probably get comparable home prices.

This is a very good point that often gets overlooked. Empty lots in desirable inner loop Houston neighborhoods cost $1M. That's not really any different from Austin.

Every large city has a desirable neighborhood with million dollar lots. But if you look at # of houses within 15 minutes of downtown that cost less than 200k. Houston is one of few that's still affordable.

This is a fun off the cuff guess but if you look at a Zillow it's not true. Houses the same distance from the center of town are significantly more expensive in Austin. Everyone I know who moved from Houston to Austin moved twice as far from downtown and paid twice as much to do it.

Interesting! I stand corrected

If you pick Zillow and look at houses under 200k you see a huge difference comparing Houston and Austin.

The issue is that living is actually a combination of housing + transportation. Looked through that lens, the large sprawl of Houston is less affordable.

The average cost of owning a car in the US is $10,728, according to AAA. It’s not easy at all to be car free in most of America. https://www.nerdwallet.com/article/loans/auto-loans/total-co...

Poorer folks are probably not looking at average car ownership costs. They're probably going to buy cheap/crappy cars, which means it's probably reasonable to live in Houston. Of course, then there's the reality that a cheap car is much more likely to need significant repair, which could either cripple a poor person in constant need of the car, or bankrupt the person, and fuel is generally more expensive as efficiency is lower.

Houston‘s sprawl pushes up transportation costs so poor people might have a cheaper car but they are paying more in gas and maintenance. And of course average people care about affordability not just the poor.

But does the low housing cost make up for the transportation cost?

I think the parent commenter did everyone a massive disservice by breaking housing and transportation into two separate categories since they're fungible with each other the same way time and money are.

Housing and commuting costs play off each other.

Working 3 jobs requires limiting transportation time to have enough remianing time to work multiple jobs. This makes Houston disruptively unaffordable for the working poor in a way that’s less obvious if you look at them combined.

It also makes maintenance time for their cars that much more difficult to schedule around.

> Poorer folks are probably not looking at average car ownership costs

That’s part of a vicious cycle down. Rent or mortgage checks are visible so people minimize that and then accept a long commute. People who buy cars based on the monthly payment often pay high interest. A farther commute means hundred of hours a year sitting in bumper to bumper traffic. A drive that’s half an hour on the weekend can inflate to an hour during rush hour. Way too many people consider housing+transportation as separate budget categories.

Also, a farther commute means higher consumption of whatever fuel you’re using, which also hits the pocketbook.

I haven't looked at the numbers but a popular and growing city being below median price?! Surely that is exceptional, probably unique for the USA or anywhere for that matter.

I've read that Houston isn't regulation free per se. Zoning was mostly replaced with neighbor associations of one sort or another which are just as restrictive with regard to dense development.

I wonder what the scale involved is, and if compared to say Boston, the neighbor associations overlay roughly onto the suburb towns that all have highly customized regulations.

It depends on the area. Most go back to when the area was developed, some of them were voted into an association (eg historic heights), others are simply drawn at class lines (river oaks is entirely an association). The lines are really arbitrary. My house has a very minimal neighborhood restriction (no commercial front businesses) while my neighbors a few blocks away are required to maintain sidewalks, upkeep of yard, etc. Condos and townhomes obviously have HOAs as well. I believe a complete tear down is the only way to part ways with a deed restriction (which is why historic homes being remodeled are sometimes razed in the middle of the night)

Draw a radius outside of Boston/Cambridge for an hour drive (not in rush hour traffic--where many of the jobs are anyway) and there are many housing prices that are pretty reasonable. Not depressed ex-steel city in the Midwest reasonable but $300K for a single family home reasonable. And this gets into pretty rural areas without a lot of regulations. Of course, many especially closer in towns are much more regulated.

They were affordable-ish... I don't have insight into the market, other than we're building like crazy and it's still not enough: https://www.houstonpublicmedia.org/articles/housing/2022/10/...

I suspect some of this is market moves (e.g. people moving into apartments during COVID, and business relocations: https://www.houstonpublicmedia.org/articles/news/business/20...).

New York, New York – 8,467,513 - 450k

Los Angeles, California – 3,849,297 - 710k

Chicago, Illinois – 2,696,555 - 252k

Houston, Texas – 2,288,250 - 192k

Phoenix, Arizona – 1,624,569 - 308k

Philadelphia, Pennsylvania – 1,576,251 - 240k

San Antonio, Texas – 1,451,853 - 175k

San Diego, California – 1,381,611 - 620k

Dallas, Texas – 1,288,457 - 225k

San Jose, California – 983,489 - 1,160k

Compared to a town with 100k people in Wisconsin Houston doesn't look very affordable. But compared to the top 10 largest cities in the US it looks pretty good.

[0] - https://www.kiplinger.com/article/real-estate/t010-c000-s002...

Well, nearly every metro went off the rails in terms of availability/affordability since the pandemic. For many years Houston was much more affordable than the national average. 2010 seems to have been the inflection point. See the first House Price Index graph here:

https://www.understandinghouston.org/topic/housing/home-affo...

Being below the national median is great for a large, growing metro.

Check every other large, economically booming metro area and see what their housing prices are in comparison. I know the last time I checked, Dallas was substantially more expensive, and that city seems like the most obvious comparison to make.

Even without traditional zoning, housing supply is somewhat land constrained, since building further up gets more and more expensive as you go higher. It still helps to be able to build higher, but it's not a panacea that will solve all housing cost problems.

I don’t think that’s right, https://www.realestatewitch.com/25-most-affordable-cities-fo...

This lists Houston as 19th on affordability and a price of $247,000

I would expect the YOLO housing and environment approach to never be about equality and affordability. I would expect it to be a signal that NIMBYism is through the roof and that they have the regulatory power to inflate prices.

I’m always shocked that people think supply is the issue…

People will live in the best place they can afford. This means prices will always be driven by the income level of people in the area.

If you suddenly built more housing in SF. You’ll actually just get more people who can afford to live in SF moving there. That’ll drive the prices right back to where they were.

Demand would have to drop, while you expand supply. Remove tech jobs from SF and demand will drop, lowering prices. If enough external people don’t wish to move there and you’re building, then prices drop.

Effectively, demand always massively outstrips supply for living accommodations

As a thought exercise: imagine it was $100/month to live in a 3Bed, 2Br house in Houston. You’d have 100m people want to move there.

Keep moving that number up, at some point you’ll get supply and demand meeting. If you add 1000 new houses, it’ll barely impact demand because you’ll have 1000 people willing to move for a $50/month reduction in cost. Then prices will be right back where they started.

Unless you can build 10k units or 100k units prices won’t meaningfully change from supply side factors alone.

I’m not sure I agree with your final conclusion while cities like Flint and Detroit exist.

That's simply running the thought experiment the other direction: There are places where you could lower the cost of living to zero and people still wouldn't move there.

Alaska effectively goes further by paying people to live there with their Permanent Fund - https://pfd.alaska.gov/ - where they give residents an annual dividend based on oil proceeds. But Kansas and other places have done the same offering to pay remote people $10k to move there.

Or European cities with reasonable rent.

This is so massively wrong I don't even know where to begin.

> People will live in the best place they can afford.

This is an overly simplified view of demand. People with live in the best place among the places they want to live. That’s why we see strong selection along political and cultural dimensions, even when they correlate weakly (or even negatively) with purchasing power.

If it's not a supply-side issue, it should be fine to bulldoze 100k units while everything remains the same, and the prices shouldn't change at all.

My point was you can’t build enough units to have the desired impact.

If you bulldozed 100k units in SF there would be no where you live. Likely it would drop property values lol

aclatuts cannot build enough units, but the country of the USA can, because it has a finite number of people in it, and immigration controls.

If you would like to be proven conclusively wrong, I'd suggest looking at Japan. Its zoning stayed much more liberal than the United States and despite the massive size and growth of Tokyo, it stays affordable. Even in SF, some of the largest housing advocates are the tech companies that don't like having to pay employees enough to live in SF[1].

[1]: https://stripe.com/newsroom/news/stripe-donates-to-californi...

There are hundreds of thousands of households in SF. Of course adding a thousand new houses is not going to drastically reduce house prices. That doesn't disprove that it's a supply-side problem. It demonstrates the size of the supply-side problem.

> If you suddenly built more housing in SF. You’ll actually just get more people who can afford to live in SF moving there. That’ll drive the prices right back to where they were.

Even if we take your theory as true, this still seems net good to me? More people able to live in SF if they want to is a good thing.

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