Yesterday, I posted these two charts, of the cross-sectional trends in the Supply component and the Cyclical component of home prices across the 30 largest metro areas.
Having read your book, and now this update to the impact of lending standards on home financing trends, it feels like there's a "quest for purity" when it comes to mortgage qualification. At some point in the future the following standards will apply to any person or family hoping to purchase a dwelling:
-Perfect credit score
-30% down payment
-house must be located in a neighborhood where regulatory induced scarcity prevents ANY decline in home values over a fifty year period
I'm only partly joking. These conditions appliy to some areas of metro Boston, New York, and California. And even parts of Florida.
Sun belt communities that have more robust supply networks (due to better permitting conditions) may be able to forestall this trend, but purists seem to be making inroads there as well.
Good comment. I think you're right. It's just to easy for there to be an arms race to appear to be the most responsible voice in deciding what other people shouldn't be allowed to do.
It seems the YIMBYs are making some progress, but I am increasingly worried that its the finance side that is becoming the binding constraint. It already has cut down single family home construction across the country. If there is a backlash against "Wall Street" landlords, I fear there are no more realistic next-best avenues for funding new homes at the scale we need them.
Having read your book, and now this update to the impact of lending standards on home financing trends, it feels like there's a "quest for purity" when it comes to mortgage qualification. At some point in the future the following standards will apply to any person or family hoping to purchase a dwelling:
-Perfect credit score
-30% down payment
-house must be located in a neighborhood where regulatory induced scarcity prevents ANY decline in home values over a fifty year period
I'm only partly joking. These conditions appliy to some areas of metro Boston, New York, and California. And even parts of Florida.
Sun belt communities that have more robust supply networks (due to better permitting conditions) may be able to forestall this trend, but purists seem to be making inroads there as well.
Good comment. I think you're right. It's just to easy for there to be an arms race to appear to be the most responsible voice in deciding what other people shouldn't be allowed to do.
It seems the YIMBYs are making some progress, but I am increasingly worried that its the finance side that is becoming the binding constraint. It already has cut down single family home construction across the country. If there is a backlash against "Wall Street" landlords, I fear there are no more realistic next-best avenues for funding new homes at the scale we need them.
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