The Collected Works of Author and Blogger Larry Roberts

Archive for 2016

The industrial midwest did not participate in the growth of the last 40 years. Once in a while, I wonder what life would have been like if I stayed in my small hometown in Wisconsin. Members of my extended family and friends from school still live there, and I generally visit every year, so I know the progress -- or lack thereof. I find it comforting when I go back that very little changed over the last 40 years. Some of the storefronts are different, but for the most part, the built environment is as it was when I grew up. In many respects, it's the realization of the nimby dream of "preserving neighborhood character." It's like the entire town was…[READ MORE]

House prices exceeded the 2006 housing bubble peak in 2016, but when adjusted for inflation, house prices may never reach that benchmark. The NASDAQ recently surpassed the tech bubble high from 2000. Anyone who bought the index in March of 2000 could finally sell their holdings without losing money. While some investors cheer this victory, those investors who didn't take a loss received dollars back from the trade that retained significantly less buying power than they held in 2000. In fact, after adjusting for the erosion of buying power, these investors still lost a third or half of their money. Investors in real estate make the same mistake. I recently demonstrated that an investor can sell a house for $100,000 profit…[READ MORE]

California creates more jobs than houses, so people leave the state for cheaper housing. In the early 1970s, California began restricting new development. At first, it wasn't a problem, but when California voters later passed Proposition 13, they made residential real estate much less desirable than commercial properties because the latter provides both jobs and sales tax revenue, whereas housing barely provides enough revenue to cover the cost of providing services. Municipalities began shunning housing in favor of commercial development, and nimbys joined the chorus, complaining about traffic and the "loss of neighborhood character," whatever that means. The natural advocates for housing are realtors, but since they only make money on resale houses, their advocacy for new construction is tepid…[READ MORE]

About 25% of potential homebuyers react with foolish urgency, but nearly half respond by either substituting down in quality, delaying their purchase, or canceling it altogether. The national association of realtors is notorious for spinning data to support a false narrative the instills urgency with potential homebuyers. The minions working for the association routinely seek out data points supporting their narrative even when that narrative doesn't mirror reality -- in fact, the less their narrative reflects reality, the more they work to spin the data. For example, NAr pending home sales data is worthless and misleading. realtors represent themselves as experts on real estate whose advice can be relied upon by market participants. However, realtors care not whether it's truly is a…[READ MORE]

Should everyone really own a house? Are renters so much less a part of their communities that the government must spend billions of dollars subsidizing home ownership? These are important questions. How we answer them will guide how we remake our housing finance system which was destroyed with the collapse of the housing bubble. The current system of government props with the taxpayer insuring more than 80% of the mortgages in the US is not tenable or desirable. Is there a balance between public and private sector appropriate to the housing market? Overzealous Intervention Dooms the Market Edward J. Pinto Those who want government guarantees for mortgages see them as a path to encourage homeownership and market stability, but instead…[READ MORE]

Page 1 of 591234567...203040...Last »