Urban housing and price
Feb. 6th, 2001 09:56 am![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
libertangoThe following are some posts I've been making to MetaFilter. Blocks of italics indicate quotes from other posts.
"Sprawling, isolated" subdivisions continue to exist, and new subdivisions are opening regularly because that's how American suburbanites want to live.
Oh, if only it were so.
See, the thing about a free market -- or even a market subsidized by great big whomping tax write-off, like the mortgage interest deduction -- is that price indicates demand.
So, what't the most expensive housing? Apartments in dense, multi-purpose downtowns.
What's the least expensive? Cookie-cutter, SimCity Classic, monoculture Burbland.
That's because discounting those "houses" is the only way to get people to buy them.
"Low blow, by the way, putting scare-quotes around "house," as if a house in the suburbs isn't just as much a house as one in the city... most of my interaction with my home occurs on its inside.
I would certainly hope so. Here's why:
I put the quotes around "house" both to protest current poor building practices, and the abuse of the words "house" and "home". A house is a physical structure. A home is an abstract institution. There's a reason why people who disregard marital obligations are called "homewreckers", not "housewreckers". :)
But to turn back to your demand vs supply observation -- demand determines supply. Or at least, the perception of scarcity. If I personally drip some paint onto a canvas, it's worthless, even if it's unique. If I can find one that's known to have been dripped by Jackson Pollock, it's ain't worthless anymore. :)
The same applies to real estate. A 100-unit building at First and Pine will command a higher price per unit than a 100-unit building in Bellevue. The most expensive house in London, I'm fairly sure, is on the south bank of the Thames, just west of the Globe Theatre, because it's about the only single house on that side of the Thames. (It overlooks St. Paul's on the other side of the river, and is in fact where Christopher Wren lived while St. Paul's was under construction.) Put that same house in Croydon, and it ain't worth as much.
I live in Orange County, Calif., and I think it's no accident that almost all the big development companies here are privately held. If they were public, they could be sued massively for lack of return, because of the cheapo kind of suburban construction they specialize in.
The thing about Burbland is that a), it's familiar -- not just to the customer but to the construction guys; b) it's quick to build; c) it's cheap to build. It really is the physical equivalent of fast food.
But a residence with texture, with feeling, with depth behind it -- the structural equivalent of haute cuisine -- is still pretty much only possible in places like London, or Paris, or the Upper West Side, or Queen Anne/Capitol Hill, or Vancouver, or the Strand in Stockholm, or San Francisco, or Sydney, or... Well, you get the idea.
My personal ideal would be a Greene & Greene bungalow in either downtown Seattle, Vancouver, or Stockholm -- but hey, that's just me (and shows my affinity for water).
But what I really object to is the idea that people are getting what they want. I think people are both smarter and more sensitive than that. They know they want something better, but are willing to muddle through with the limited palette of choices presented to them.
And (he said, coming full circle), I think Burbland's low, LOW prices reflect that muddling through.
aaron:Yes, and the main reason for its cost is lack of supply.
Perhaps you were typing at the same time I was, but to repeat: Supply is defined by demand.
If I have 30 million houses, but 40 million people want them, they're going to be expensive. If I have one house and nobody wants it, it's going to be cheap.
It follows from what you say that even with prices artificially jacked up, demand for urban downtown housing is so high that people are still willing to pay those prices. And what I'm saying is that, even with suburban housing being deeply discounted, subsidized, and in abundant supply -- that such high urban demand and pricing still exists.
This, to me, is a clear indication of what the overall market wants.
"Sprawling, isolated" subdivisions continue to exist, and new subdivisions are opening regularly because that's how American suburbanites want to live.
Oh, if only it were so.
See, the thing about a free market -- or even a market subsidized by great big whomping tax write-off, like the mortgage interest deduction -- is that price indicates demand.
So, what't the most expensive housing? Apartments in dense, multi-purpose downtowns.
What's the least expensive? Cookie-cutter, SimCity Classic, monoculture Burbland.
That's because discounting those "houses" is the only way to get people to buy them.
"Low blow, by the way, putting scare-quotes around "house," as if a house in the suburbs isn't just as much a house as one in the city... most of my interaction with my home occurs on its inside.
I would certainly hope so. Here's why:
I put the quotes around "house" both to protest current poor building practices, and the abuse of the words "house" and "home". A house is a physical structure. A home is an abstract institution. There's a reason why people who disregard marital obligations are called "homewreckers", not "housewreckers". :)
But to turn back to your demand vs supply observation -- demand determines supply. Or at least, the perception of scarcity. If I personally drip some paint onto a canvas, it's worthless, even if it's unique. If I can find one that's known to have been dripped by Jackson Pollock, it's ain't worthless anymore. :)
The same applies to real estate. A 100-unit building at First and Pine will command a higher price per unit than a 100-unit building in Bellevue. The most expensive house in London, I'm fairly sure, is on the south bank of the Thames, just west of the Globe Theatre, because it's about the only single house on that side of the Thames. (It overlooks St. Paul's on the other side of the river, and is in fact where Christopher Wren lived while St. Paul's was under construction.) Put that same house in Croydon, and it ain't worth as much.
I live in Orange County, Calif., and I think it's no accident that almost all the big development companies here are privately held. If they were public, they could be sued massively for lack of return, because of the cheapo kind of suburban construction they specialize in.
The thing about Burbland is that a), it's familiar -- not just to the customer but to the construction guys; b) it's quick to build; c) it's cheap to build. It really is the physical equivalent of fast food.
But a residence with texture, with feeling, with depth behind it -- the structural equivalent of haute cuisine -- is still pretty much only possible in places like London, or Paris, or the Upper West Side, or Queen Anne/Capitol Hill, or Vancouver, or the Strand in Stockholm, or San Francisco, or Sydney, or... Well, you get the idea.
My personal ideal would be a Greene & Greene bungalow in either downtown Seattle, Vancouver, or Stockholm -- but hey, that's just me (and shows my affinity for water).
But what I really object to is the idea that people are getting what they want. I think people are both smarter and more sensitive than that. They know they want something better, but are willing to muddle through with the limited palette of choices presented to them.
And (he said, coming full circle), I think Burbland's low, LOW prices reflect that muddling through.
aaron:Yes, and the main reason for its cost is lack of supply.
Perhaps you were typing at the same time I was, but to repeat: Supply is defined by demand.
If I have 30 million houses, but 40 million people want them, they're going to be expensive. If I have one house and nobody wants it, it's going to be cheap.
It follows from what you say that even with prices artificially jacked up, demand for urban downtown housing is so high that people are still willing to pay those prices. And what I'm saying is that, even with suburban housing being deeply discounted, subsidized, and in abundant supply -- that such high urban demand and pricing still exists.
This, to me, is a clear indication of what the overall market wants.
