The Collected Works of Author and Blogger Larry Roberts

Archive for August, 2016

By providing more housing units, apartment developers will lower housing costs over time and relieve the pressure on Californian's personal budgets. Combating the chronic shortage of available housing in California requires building more places to live. It matters little if these new housing units are small apartments or large mansions. As developers build more, all segments of the housing market will be more affordable to everyone in California. How to lower housing costs Imagine what would happen if California legislators found the political will to actually solve the housing crisis in California rather than giving in to the Nimbys. If Governor Brown formed a committee and charged them with crafting a policy to bring housing costs down as quickly as possible without…[READ MORE]

Houses feel expensive because an unusually large percentage of the payment is going toward principal amortization. For the last few years, my monthly housing market reports rated most communities across Southern California highly, suggesting it's a very good time to buy a house. Yet despite this dispassionate review of the math, most people who actually shop for a house feel like prices are way too high. Why is that? Well, house prices are high. The federal reserve in conjunction with government officials reflated the housing bubble to restore collateral backing to lender’s bad loans. The housing bubble that peaked in 2005/2006 witnessed house prices 20 years ahead of their time. Reflating the housing bubble in 2016 still puts us 10…[READ MORE]

As Millennials buy new homes, builders will provide smaller houses Millennials can afford. For years, academics in planning circles touted the rise of the small, high-density housing alternatives near mass-transit hubs. While this product might be the future of housing, it won’t be due to any preference by Americans for smaller digs. People will substitute down to smaller properties conveniently located near mass transit, but they will do this because the more desirable McMansions in the suburbs will become too expensive. Builders aren’t concerned with what academics think they should build; builders will provide whatever product buyers in the market want. Very few entry-level buyers are active in the market because Generation X is trapped in their starter homes, and the Millennials are not yet…[READ MORE]

Both the data and the anecdotes demonstrate a noticeable and significant slowdown in home sales. Is it merely seasonal? I am moving out of my current rental and back to Orange County (more on that later). I agreed to allow my landlord to market the property for sale over the last month while I still lived there. I was worried about aggressive buyers peeking in my windows, but that isn't what happened. So far, very few people came to tour the property. I spoke with the agent (my landlord's sister) about what was going on, and she provided a remarkably candid assessment. She said it was like buyer interest fell off a cliff in August. She said there are three…[READ MORE]

When Nimbys lose their emotional fights to block new development, new families move into the neighborhood and enjoy new houses that otherwise would not have been built. Real estate development provides homes, offices, shops, features of the built environment that define the quality of everyday life. Without the changes to the land required by our built environment, we would still be living in caves trying to subsist off the land like our stone-age ancestors. However, too much of a good thing can be as bad as too little of it. When real estate development is done poorly, or when every last trace of the natural environment is eliminated in favor of the built environment, quality of life suffers. There is…[READ MORE]

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