re: The Atlantic: the great affordability crisis breaking America

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This is why it boggles my mind that a Google, Apple, etc doesn't move to more rural areas with lower taxes.

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I mean there is clearly a competing issues of cost savings vs. talent recruitment, so clearly they have determined that the savings in costs on the extreme end (the rural areas) do not justify the issues of being able to recruit the specific talent they need as a company.

On the other hand, there a number of midsize cities, that are much more reasonably priced (Charlotte, Columbus, Nashville, etc.) that these types of companies are expanding rapidly into as they can save on costs but also attract enough talent.

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And while it’s not as extreme, these cities are also experiencing housing problems (e.g., shortages, prices, etc.) as a function of growth and increase in demand

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I'm struggling to see why this is defined as a problem

If prices are going up that means people are paying them which means they are affordable. Literally nothing in this world is affordable to everybody

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I'm pretty sure that's not why the demand is high.

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LOL. Wut

Clearly people want to live there and clearly enough of them can afford to live there that prices go up. That's called demand.

If at some point there are not enough people who want to live there that can afford to live there prices will go down

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It’s also a ridiculous assertion that nuclear families cannot exist in apartments or condos. A single family home is not the only way to raise a family

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This is actually a good point for a slightly side reason

You are correct that family is most certainly could live in these places but they have options and they're choosing other options. I mean I'm sorry. A family of four with a household income of 90k where I live can live quite nicely. They could double their income and move to New York City and live like s*** work commute like crazy.

It's a big country.

Something that hasn't been addressed in this thread is that I actually think this problem is temporary even if one wants to define it as a problem

Technology more and more is making telecommuting a very reasonable method of doing one's job

I foresee a Time when the concept of cramming 1000 employees in a company headquarters located in one expensive area of the country will be a relic.

Honestly, there is virtually no reason for my physical presence to do the job that I do. I could do my job from anywhere in the country and my organization would barely notice.

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I guess it depends whether you’re buying or not; however, I would have to search for it, but I ran the numbers one time on the Moneyboard in a related discussion and the over the last few decades the increases in home prices have greatly outpaced the increases in income.

So whether you think it’s a major problem or not, I would think that you could see why it would be more of a problem for home buyers today than home buyers 30 years ago

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Home prices don't increase in a vacuum. It is self-evident that if home prices are going up it is because people can afford them so the static look at the numbers clearly misses something in the equation.

Homeownership rate is higher now than it was 30 years ago despite the fact that prices are higher. So while it might seem intuitive that there's a disconnect between wages and home prices, clearly there is not

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Housing prices are rising faster than wages almost EVERYWHERE

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And yet demand for that housing is going up which means that a static look at the numbers is clearly missing a variable. Otherwise demand wouldn't be going up.

Surely this is self evident to you if you think about it.

But as I pointed out in a post a bit ago. I think that 20 years from now people will look back at today and not even know what the problem was because they'll be working from all over the country. Technology is going to solve this problem long before any of us figure it out

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Not only that, but this would solve a whole bunch of other issues (e.g., traffic congestion, employee satisfaction, productivity, etc.)

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Yep

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Of course, it seems that the inertia is strong here so we should already being seeing this e

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unfortunately humans being humans we still have a lot of people who think they have to see your face to know you're working in positions of authority

it'll be a little bit slower than we think it should be but it's going to happen never the less. This thread part of why it will happen. Companies are going to want to attract young talent without having to pay them enough to live in New York City and technology is going to provide them the ability to do that.

It will be a massive adjustment for managers but it's going to happen anyway

This country is going to be so much different in 50 years and not just because of demographic changes

People are going to be working for Apple from North Dakota and Utah and Alabama etc etc

while the cities will always remain in demand for a variety of reasons I foresee our population smoothing out a bit across the country.

It won't be smooth by any stretch of the imagination but it'll be smoother

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Ever heard of a trust fund?

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yes but you're going to have to spell out how that's a rebuttal

In any case I still think this is a classic example of the government trying to solve a problem that technology is going to solve better than government could think of solving it

In fact if you want me to make a bold prediction here it is

As technology allows for telecommuting property values in these concentrated areas that have been going crazy are going to Crater

50 years from now Americans are liable to see cover stories on how to solve the problem of hollowed-out cities now that so many people can do their jobs from Iowa Oklahoma Missouri and Colorado

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It is self-evident that if home prices are going up it is because people can afford them so the static look at the numbers clearly misses something in the equation.

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Of course, but when a necessity (including rent costs rising with home prices) becomes less affordable, it’s more problematic than when it was more affordable. This kind of relates to a broader issue of the things that have outpaced inflation (housing, healthcare, and inflation) are more important necessities instead of discretionary.

I know personally, it was quite stressful trying to pay for rapidly increasing rent and saving to buy a home in a rapidly increasing price market. Whereas buying a cheap (and cheapening) flat screen was nice, but it wouldn’t have been near as stressful if they were rapidly increasing in price instead. I could have lived with just the same 42” TV I got in 2010.