This is huge! I looked at every home listed on Zillow in my area for months before checking out 2 in person and submitting an offer on 1, which was thankfully accepted.
That was before the major housing shortage. The US is short about 6M homes by some measure [2], and the Bay Area is short a staggering quantity all by itself, so much so it has its own Wikipedia article. This remains the fault of onerous zoning rules and NIMBYs. [1]
[edit] No supply + high demand = prices go up. Higher interest rates only help at the margins because it doesn't actually change the demand factor which is that the humans in America need a place to live, and the more they make, the more they can afford to pay. And it certainly doesn't change the supply factor!
FWIW in my East Bay neighborhood, I'm noticing in the last couple months it's taking closer to a week (rather than a day or 2) for "Coming Soon" real estate signs to change to "Sale Pending".
This is about 1 mile from where I live in Overland Park, KS. PV is all single family homes with near zero apartments. Of course the city is trying to re-zone to put in higher density housing, and the population is vehemently opposed to it; I don't blame them. People move there for that reason. Higher density leads to more crime and other frustrations. People learned their lesson from the pandemic.
Why would higher population density lead to higher crime rates? Do you have a source for that?
Poverty and general desperation leads to higher crime rates as people resort illegal means to get by. And that's what happens when there is not enough housing for people.
In the United States, we have a whole bunch of terrible housing policies, so maybe people are conflating density for poverty. But you can find many examples across Europe and Asia where there is little correlation between density and crime.
It makes a kind of intuitive sense. If a certain % of human interactions are crime, and you create circumstances where there are more interactions (packed night club, large convention, dense city, etc), you could expect more of all kinds of interactions including crime. Whether that's how it works in reality is another question.
- "Hm, ok, how about we build new houses in the places people want to live, increasing supply to meet demand"
- "NOT LIKE THAT"
It's just like the "no take only throw" dog meme.
If you don't want to live next to other people, buy the land around you. If you can't afford the land around you, move further away. There's no reason your tastes should dictate what I can do with my property. I'm sorry, I thought this was America.
The cultural bifurcation however is increasingly pronounced. Ironically, all the more so as communications technologies improve, because those improvements are concentrated increasingly in dense metropolitian areas. Not necessarily city centres, but the urban metro areas net of suburbs around wealthy regions --- many along the coasts, but also urban areas within otherwise rural states (e.g., the blue-red division within the South and West between cities in those regions and urban areas).
The height of homogenisation probably came about with general availability of rail-based package deliver, direct postal mail delivery, rural electrification and telephone service, major broadcast television and radio networks, and the US Interstate Highway System buildout.
At some point between the mid-1940s and mid-1970s, there wasn't a whole lot of difference between what general culture was available within a broader metro region and a rural area. Broadcast and print culture (e.g., magazines) were fairly uniform (there weren't enough networks to support hugely divergent micro-targeting), goods and communications could spread well. Yes, major cultural hubs such as New York, Los Angeles, and San Francisco had their own specific cultures, and there was information for which you'd probably have to physically visit a major university campus or library to access. But overall, cultural diversity was hitting a low point. Flyover regions might wait a few weeks or months longer for first-run films (distributed as actual film prints), or see less coverage by major performing acts, but that was largely it.
That's been walked back with increases in direct-cabled broadband communications infrastructure, probably starting with cable TV (the fact that cable TV wasn't yet available was a laugh line in Fast Times at Ridgemont High, 1982, with the book it was based on published in 1981).
Now, the distinction between broadband in the tens of Mbit (or lower) vs. 100 Mbit to Gigabit ethernet, 5G vs. 3- or 4-G mobile networks, and general reliability of network infrastructure, as well as installation and maintenance costs, is a major distinguishing feature between first-tier and tertiary markets. In a world where work is performed remotely, being able to participate in full-video conferencing or download or upload content matters.
Maybe those differences will get ironed out. But as with postal mail, intercity rail and bus service, interstate highways, telecoms, and electricity, it all but certainly won't be market mechanisms on their own which do so. All of the listed services I've just named were brought to rural regions through government programs, projects, organisations, and/or subsidies.
Indeed, but the speed of it has accelerated massively in the last two decades, particularly with "smart farming" and big agriculture investors buying up entire areas and consolidating the fields, and by the aforementioned globalization allowing the devastation of mining and heavy industry as it was now possible to shift all of that to China and other places with lax environmental regulations.
> In the 90s it was typical for a house to be on the market for 3-6 months before selling. Sellers generally received 1 offer.
I wonder if there's been a material shift in who is making offers that won't revert to 90s behavior. Specifically, investment firms specializing in single family housing, who might have more incentives to make a lot of lowball offers and not worry too much whether they win or lose a specific bid.
Obviously you have imitators like Zillow trying to edge in as well, and step back after taking heavy losses, so its hard to say for sure where the new equilibrim will end up at.
> Specifically, investment firms specializing in single family housing
I dont think I have seen good data that includes or calls out "investors" rather than "investment firms" I suspect that a lot of property ends up in the hands of individuals be it a vacation home, rental, air BB or flip.
Interest rates in the 90s started in double digits and ended just below that. Also things that weren't mortgages (like cars) still had double digit interest. In 1999 I paid 13% interest for my car.
Currently the nationwide days-on-market is still way below long-term historical norms and even below recent history. https://fred.stlouisfed.org/series/MEDDAYONMARUS