Interesting comments from one of my former students on housing

[andrew_j]

Unfortunate for world if bright engineering mind went into real estate that honestly benefits few unless becomes generous.

However great if works out!

 

[PimTac]

So building condos that are are affordable compared to single family housing is not a good thing if it's in your neighborhood?
Was the lot next to the lady zoned multiple housing already?

No it’s not a good thing and that makes me the grinch. It’s changing the neighborhood in a bad way. Residential zoning is totally different today. The new rules dictate that there must be mixed housing. What that means is single family homes and apartments all together. In my example a home gets torn down and apartments get shoehorned into the lot.

Right across the street from me they have started to build a development on five acres. There will be 200 homes on that five acres plus the streets, open space that is also mandated and a drainage space. On one side of one street it looks like half a dozen single family homes are going in. The rest will be tall and skinny three story townhomes as they are called. These are the tenements of the future and are advertised as affordable homes under $450,000.

I’ll be gone before they finish it though.

 

[brianl703]

This is the thing. They are changing zoning laws everywhere. It’s not a specific locality but a mandate from higher up. This is happening in all kinds of neighborhoods and areas.

It's also slick-talking developers who con local jurisdictions who want commercial development that they need more "rooftops" to get it.

So the high density apartments get built...the commercial development never happens, even years later.

 

[PimTac]

It's also slick-talking developers who con local jurisdictions who want commercial development that they need more "rooftops" to get it.

So the high density apartments get built...the commercial development never happens, even years later.

I’ve seen that as well. The four story buildings might have a business on the ground floor. We have that nearby as well. The ground floors are about 75% vacant. The ones that are there are what I think of as disposable businesses like nail salons and ice cream parlors. These businesses tend to be there for a time then fold up.

 

[GON]

You're really depressing the heck out of me @GON

If this all holds true, I'll have 4 kids that will never be able to fly the coop.

@JTK , that is way the most of the world does it, multiple generations under one roof. We are also depressed by this, we saved up to buy a home in a "non prime" location, and even these non prime locations have become hot. We would gladly buy a deeply "distressed" home in a non prime location, and those don't even last on the market long enough for us to fly and do a quick check out of the distressed home.

Challenging times for some who want a home and don't have very deep pockets....

 

[SC Maintenance]

Yep-your argument is classic "NIMBY".

Not really, its classic I don't want to pay for your "affordable" housing.

And as I mentioned above I will be moving shortly, so it won't be MBY shortly. And yes, no one here will miss me, but my job is portable, so all the money I spend here will not be replaced by someone else moving in to take my job. My job will come with me to the next place, and all the associated taxes and local spending will come with me also.

 

[GON]

I’ve seen that as well. The four story buildings might have a business on the ground floor. We have that nearby as well. The ground floors are about 75% vacant. The ones that are there are what I think of as disposable businesses like nail salons and ice cream parlors. These businesses tend to be there for a time then fold up.

The issue with business like nail salons... even banks, is they often don't generate any sales tax for the township they are located in. These business requires services from the town, but don't generate sales taxes for the town.

 

[JeffKeryk]

I would rather have a much smaller, older $575K house in a nice neighborhood than a much bigger house in a terrible area with high crime and drugs.

Buying a $575K McMansion in a bad part of Houston is not a good idea….. especially if the TV show First 48 is filming in your neighborhood and city medical examiner is removing a dead body from the street.


I gave each of my adult children $70K cash to help with down payment so they can buy a house in a nicer neighborhood. I don’t want them to deal with the problems of lower income areas and have to worry about their safety.

Dave, this property is an entry level house. And the reason it is so low is it is 55+.
Watsonville used to be a rough area; it is just south of Santa Cruz in the beautiful Monterey Bay area. The rising prices in Silicon Valley pushed out the rough parts. It is a pretty peaceful place now, lots of farm land. Kinda in between the Silicon and Central Valleys.

 

[ripcord]

The issue with business like nail salons... even banks, is they often don't generate any sales tax for the township they are located in. These business requires services from the town, but don't generate sales taxes for the town.

Texas has a sales tax on services, so I don't see how a nail salon wouldn't provide tax revenue.

Edit: Correcting myself... Texas excludes hair dressers from collecting sales tax, so I assume nail salons would be similar as they are licensed "professional" services.

 

[GON]

Texas has a sales tax on services, so I don't see how a nail salon wouldn't provide tax revenue.

Edit: Correcting myself... Texas excludes hair dressers from collecting sales tax, so I assume nail salons would be similar as they are licensed "professional" services.

Didn't know that Texas has a sales tax on services. I suspect that is not common in most of the other 49 states. I would also speculate that many nail salons and barber shops may not be reporting their "service" sales to the state in whole..... cash businesses.....

 

[SubieRubyRoo]

@JTK , that is way the most of the world does it, multiple generations under one roof. We are also depressed by this, we saved up to buy a home in a "non prime" location, and even these non prime locations have become hot. We would gladly buy a deeply "distressed" home in a non prime location, and those don't even last on the market long enough for us to fly and do a quick check out of the distressed home.

Challenging times for some who want a home and don't have very deep pockets....

Somebody bought the house next to me (ok, it's actually 408 yards, but new neighbors don't like to know you've already scoped out distances...) on THE DAY it hit the market, for $20k above asking. Turned out my wife knows the family. They're doing a full renovation before they even move in... crazy. Makes me feel good though, my house is essentially reno-done, and effectively the same land (acres of grass, outside of town). Which means I've already more than doubled what I paid for it in 2019.

Too bad I'm not leaving til it's in a box the government gives to my NOK...

 

[GON]

You're really depressing the heck out of me @GON

If this all holds true, I'll have 4 kids that will never be able to fly the coop.

 

[brianl703]

I’ve seen that as well. The four story buildings might have a business on the ground floor. We have that nearby as well. The ground floors are about 75% vacant. The ones that are there are what I think of as disposable businesses like nail salons and ice cream parlors. These businesses tend to be there for a time then fold up.

There's one in a nearby (8 miles) city that the ground floor has maybe one or two businesses at most. The rest are all vacant, not built out, they still have dirt floors, and if I recall correctly this stuff was built about 15 years ago. I'm told that the landlord wants ridiculous money for the spaces, this building is on a road that doesn't get nearly as much traffic as the rents they're asking would warrant.

 

[drtyler]

The issue with business like nail salons... even banks, is they often don't generate any sales tax for the township they are located in. These business requires services from the town, but don't generate sales taxes for the town.

Business and professional licenses aren’t free (typically).

 

[RhondaHonda]

It's also slick-talking developers who con local jurisdictions who want commercial development that they need more "rooftops" to get it.

So the high density apartments get built...the commercial development never happens, even years later.

It’s almost always the city that requires mixed use, ie some retail component on the ground floor. The developers don’t want to do it and figure it will sit vacant when they underwrite the deal.

 

[GON]

Business and professional licenses aren’t free (typically).

Do you want a business occupying a space that pays a annual business license, or a business occupying a space that pays and annual business license AND sales tax monthly?

 

[CKN]

No it’s not a good thing and that makes me the grinch. It’s changing the neighborhood in a bad way. Residential zoning is totally different today. The new rules dictate that there must be mixed housing. What that means is single family homes and apartments all together. In my example a home gets torn down and apartments get shoehorned into the lot.

Right across the street from me they have started to build a development on five acres. There will be 200 homes on that five acres plus the streets, open space that is also mandated and a drainage space. On one side of one street it looks like half a dozen single family homes are going in. The rest will be tall and skinny three story townhomes as they are called. These are the tenements of the future and are advertised as affordable homes under $450,000.

I’ll be gone before they finish it though.

Yea-everybody wants home ownership for others because it's a better "thing". But nobody wants to make sacrifices to makes it happen. Don't worry-I have seen posts just like yours (almost word for word) on our local Facebook pages.

 

[SubieRubyRoo]

The market today doesn't reflect what happened in '08.

It will soon… 8% mortgages combined with ****nomics and the Fed’s wrangling…. If things stay on their present course, we may see even more of ‘08 cleanups where private land ownership becomes the anomaly rather than the norm.

 

[gfh77665]

His bottom line to his investors- residential real estate is both a near term and long-term golden goose. This also means that for individuals looking to buy a home, it may be tough today, and get even tougher going forward.

I invested heavily in single family real estate beginning in 2008 (financial crisis). I bought up a nice portfolio of foreclosed homes. I have done quite well with it, as property values have increased 2X to 3X, plus all the rental income they produce. I am going to hold indefinitely.

 

[PimTac]

Yea-everybody wants home ownership for others because it's a better "thing". But nobody wants to make sacrifices to makes it happen. Don't worry-I have seen posts just like yours (almost word for word) on our local Facebook pages.

I will have to take your word on that. I don’t use FB.