re: The math for buying a home no longer works, per WSJ

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I live in a county and city comprised of mostly upper middle class families with teens and retired people (also a LOT of military families who receive some serious housing stipends). It would be impossible anywhere in that county to buy a lot big enough for a well and septic tank, or one on county utilities, and build a modest home on it....the dirt is too damned expensive. It is too damned expensive in part due to demand but it also is a function of zoning that requires massive lots and restrictive covenants, allowed by zoning, which increase the costs of anything built in the county. About 95% of the development in the county in the last 20 years has consisted of tract house development with 4000 square foot, 5 bedroom 4 bath houses on 1/10th acre lots. A 1/4 acre lot is huge and a 1/2 acre lot looks like an estate. Those houses are selling for around $450K. Most of them have 3-5 people living in them. Those houses are what is required to make building lucrative enough to be worthwhile because of zoning and building codes that have nothing at all to do with owner safety and everything to do with keeping real estate prices as high as possible. There have been some proposals to build smaller houses, even condos and other attached residences...almost all BUT luxury condos have ever been approved. There is a market for smaller, less expensive moderate houses in the US and they can be built...but the margins are not attractive to developers and bankers and they control the market. This county is not unique, almost all of any area in the country close to jobs and services is identical. There is no way a family of 4 needs 4000 square feet of 5 br 4 bath house...but thats what is being built.

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