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This is an awesome site, visually depicting how unaffordable housing has become in so many parts of the US.

It's truly amazing how much the Fed (with perpetually low interest rates) and local restrictions on building (making it more expensive or impossible to build) have increased the cost of home ownership over the past 60 years.

Anyone who's seriously considering purchasing a home should read The Housing Trap by Patrick Killelea, it's a short, amazing overview of how we arrived in the situation we're in as well as a practical guide for when to buy vs rent housing.

https://www.amazon.com/dp/1479156213/ref=cm_sw_r_sms_awdb_Ki...

⬐ dv_dt

I cant help but notice in the OP visualization, the houston area is cheap - a year of work, and reputed to have little regulation - like zoning regs for flood watersheds, or regulatory oversight over chemicals stored in warehouses...

⬐ stevenwoo

Cockroaches are rampant in larger apartment complexes. If you go to poorer or less well maintained places and restaurants, the things are literally crawling over everything - it's hard to believe it's America. Mosquito breeding areas in all the ubiquitous slow winding bayous and creeks. The one month or so of winter cold enough to freeze results in sleet not snow most of the time due to prevailing atmospheric conditions. The rest of the year feel the need to take a shower after spending 15 minutes outside due to humidity.

⬐ rsheridan6

I lived in Houston for a few years and I'd take its flaws over being house poor in a coastal city.

⬐ stevenwoo

That's fair - just pointing out if one hasn't lived there there are some signficant downsides not included in the housing comparison. Grew up there and worked and lived there a few decades later.

⬐ eanzenberg

This more-so shows how affordable lots of the country is!

⬐ zaroth

That's funny, my takeaway was that the vast majority of the US has incredibly affordable housing.

But I suppose if your call center employees simply must be living in downtown S.F. the answer must be that we just need lax zoning and higher density!

⬐ sbenitoj

Ha, well in non-major cities you're right, but all the major cities cost an arm and a leg for the most part!

⬐ majormajor

Leave the coasts and you can find all sorts of multiple-million-people cities with far cheaper housing.

⬐ twobyfour

Are you sure about that? There are only a couple cities in the US other than NYC and LA that have populations of 2M or more, and only 10 cities total with populations above a million in the last census.

⬐ matthewbauer

If you count entire metro areas, there are at least 50.

⬐ zaroth

Well the only way to drive down price is to either increase supply or decrease demand. So make cities shitier and denser.

Is this a case where a small increase in supply would decrease the price significantly? I doubt it.

So, is there some reason we (as a nation) need to double population density of our largest cities? With the huge advances we are likely to see in autonomous zero-emission delivery infrastructure and remote communication over the next 20 years, not to mention the increasing likelihood of natural disasters and WMDs hitting these cities, I really don't see the point of pushing for so much urban growth.

⬐ kelnos

> Well the only way to drive down price is to either increase supply or decrease demand. So make cities shitier and denser.

That's just, like, your opinion, man. I prefer living in denser environments.

⬐ zaroth

Shitier may be orthogonal to denser.

But to your point, if denser is so much better, will increased density lead to lower prices, or just create more demand and keep prices the same?

⬐ brightball

Because I keep seeing articles pop up over the last few years trying to convince me that suburbs are basically evil incarnate for some reason. It gets to the point where it feels like a political platform.

⬐ zaroth

There's definitely a political platform here. Economic models claiming suburbs are beyond bankrupt and destined for failure. [1]

Apparently my property taxes can't even cover the cost of pavement and water mains, and yet we just built a new school, and are in the process of planning a $20 million library.

[1] - https://www.strongtowns.org/journal/2017/1/9/the-real-reason...

⬐ throwawayjava

> Apparently my property taxes can't even cover the cost of pavement and water mains, and yet we just built a new school, and are in the process of planning a $20 million library

From the link: "If they operated on accrual accounting -- where you account for your long term liabilities -- instead of a cash basis -- where you don't -- they would have been bankrupt decades ago"

The PF analogy to what you're saying is "yeah I'm dipping into savings to make mortgage payments and need to replace my roof next year and repair a major crack in the foundation. But they let me open a credit card and get a loan for a car, so what's the problem?"

⬐ ghaff

In addition to less expensive cities, in many in-demand cities (SF not so much), it's actually possible to live in many nice suburbs/exurbs for a lot less money. That's often even where most of the tech jobs are.

Boston/Cambridge? Expensive. But 45 mins or so out? Far less so. And you're closer to where most of the jobs are anyway. The urban cores may be a lifestyle choice. But it's a luxury choice in many cases. Not a place that someone actually has to live if they want to work.

⬐ culturalzero

You clearly don't know what it's like to live on minimum wage right now. It's extremely difficult to live anywhere even close to the Bay area on minimum wage, which let's be real, a call center employee would be on. Public transportation options get figured in there too. I'm very fortunate to have a good job now, but it wasn't all that long ago I was scraping by on near minimum wage.

⬐ rconti

The point of the parent post is the vast amounts of land that contain cheap housing.

Of course, it doesn't address how easy it is to find a job in the first place in those locations, but it's a great point nonetheless.

⬐ angersock

This is one of the reasons companies have a strategic advantage when they let their CS folks work remotely.

⬐ jrochkind1

I think it's probably extremely hard to live nearly anywhere in the U.S. on minimum wage.

⬐ zaroth

No, I understand exactly and I think we are in violent agreement.

One cannot afford to live in the Bay Area on anything near minimum wage. So fuck "The Real Bay Area" and live just about anywhere else in the continental US.

⬐ maxerickson

Median wage is 2-3x the minimum wage.

So housing affordability on minimum wage in most of the US is closer to California at median wage than it is to most of the US at median wage.

⬐ zaroth

TFA shows that in well over 50% of the land mass of the continental US, houses can be bought for 1 year of median wages.

Living on minimum wage is hard anywhere. The question is -- is it OK if there is 5-10% of the continental US where it's impossible to live on minimum wage? I think that yes that's probably OK...

Is it OK that for some [relatively small number of] cities, that median wage feels like minimum wage? Why is that a problem when people have the choice to live there or not?

⬐ pjmorris

> That's funny, my takeaway was that the vast majority of the US has incredibly affordable housing.

What are you comparing against? In the US, the old rule of thumb (up until the ~1990's) was that you shouldn't buy more house than 2X your income. That's more affordable than what is depicted here.

EDIT: I've added link to a Calculated Risk post on the ratio between US house prices and median income since 1976 [0]. By their estimates, the typical ratio has been 3X, low by your standards.

[0] http://www.calculatedriskblog.com/2017/07/house-prices-to-na...

⬐ danans

> But I suppose if your call center employees simply must be living in downtown S.F. the answer must be that we just need lax zoning and higher density!

The call center employees living en masse in SF is a very far fetched claim that requires strong evidence here, along with the implication that they are what necessitates higher density.

This framing is insensitive to both call center workers who likely could never afford to live in SF and those who are paying the price of anti development NIMBYism in the Bay Area housing market.

⬐ taway_1212

> This framing is insensitive to both call center workers

Capitalism is a ladder (To paraphrase a certain GoT character). No one has to be a call center worker till the end of their days, it's just stuff you do until you can find a better job (perhaps after attaining some extra training in your off-hours).

⬐ zaroth

Hmm... I never said anything about "en masse". It was a reference to the Yelp/Eat24 call center employee controversy from last year. [1] In cases like these, I think it's very reasonable to question why those kinds of jobs should be the ones increasing demand in SF and, therefore, driving up prices for everyone else.

If you think my framing is insensitive to call center employees, I think you may have misunderstood me. I was condescending to the call center employers who are causing undue financial stress on their employees by making S.F. relo a job requirement for what should be a satellite office, if not remote work, position.

My point is also that people who struggle to afford the high cost of living in the "Real Bay Area" [2] -- of which I was one -- should perhaps consider, I don't know, moving -- which I did.

The idea that SF should be redesigned and reconstructed until such time as supply is so plentiful as to bring down prices an order of magnitude, to me that's the offensive bit. I think the property owners of SF are well within their rights to tell people who want to build affordable housing towers to get lost.

[1] - https://www.washingtonpost.com/news/the-switch/wp/2016/02/23...

[2] - See: http://www.burbed.com

P.S. If this comes off as a little combative, I apologize, my dad is in a house on the canal in Cape Coral, FL right now and refusing to evacuate.

⬐ woodpanel

> I think the property owners of SF are well within their rights to tell people who want to build affordable housing towers to get lost.

And that is the problem!

The concept of property ownership is crucial when it comes to NIMBY vs. YIMBY. Because with politically entrenched tight zoning, property owners can tell others what to do with their property too.

Whereas in cities with lax zoning you effectively get stronger property rights. And in countries which constitutionally protect property ownership you basically see a very elastic housing market and thus not as much gentrification/housing-shortages.

⬐ quickthrower2

> I think the property owners of SF are well within their rights to tell people who want to build affordable housing towers to get lost

Technically correct, first amendment and all. But really you are pro-NIMBY?

⬐ zaroth

It does seem pretty fundamental to me. I do think communities should be allowed to organize themselves in basic ways that are not discriminatory against protected classes.

Zoning is pretty important. A neighbor recently subdivided his large lot into 3, and having enough frontage on the street meant they could do it without zoning board approval. The houses they are building were designed precisely to push to the max against every possible zoning bylaw; setbacks 1 inch above the minimum, building height-above-grade 1 inch below the maximum, lot coverage ratio 1% below the maximum, etc.

Then their proposed septic failed perc testing at ground level, and since they didn't want an "unsightly mound" in their backyard, they brought in about 80,000 cu yards of dirt and raised the whole lot up by ~20 ft! Because the bylaw was written as building height calculated against finished grade, not natural grade there was nothing stopping them from creating their hill. Well, they did have to build a substantial drainage system around the perimeter because it's illegal to increase stormwater runoff from a lot in the natural vs. finished state, but we'll see how long that lasts...

Builders will cut every corner, push every limit, and develop to the absolute highest density to maximize profits. Of course building codes and zoning bylaws make housing more expensive to build. Getting a glimpse at what builders will do given the chance, to literally my back yard, I really, really wouldn't want to see what would happen if zoning boards could be overridden by outside developers wanting to "increase supply".

For example, most of the new construction in SF is rental units. You can't buy it, you can't own it. It's going to be mostly corporate housing, run by corporate property managers, with cookie-cutter units, probably poorly run and poorly maintained.

I've been on a condo board for ~10 years. Building a community is hard work! But as the rental ratio in the complex climbed from 0% to 32% over the last 10 years, there's a stark difference between renters and owners in how people treat the units and common areas, treat their neighbors, and the level of involvement and care they have for the complex itself. Certainly some owners create problems, but having a vested interest makes a big difference vs. certain renters who could give a shit. And, problematically, when the owners move away and decide to rent, they usually stop giving a shit too.

⬐ danans

> The idea that SF should be redesigned and reconstructed until such time as supply is so plentiful as to bring down prices an order of magnitude, to me that's the offensive bit.

Not sure where you get the idea that it should be redesigned, but I do think that incremental [1] upzoning in places where demand exceeds supply of housing (in SF and beyond) makes a great deal of sense.

[1] https://www.strongtowns.org/journal/2015/12/16/incremental-d...

These are fair points. I've met Patrick in person and used to follow patrick.net a while ago (>4 years ago), but the discussion threads appear to have gone downhill a bit. But as someone else pointed out, there are some FAQs there that provide a useful counter to the conventional wisdom. Also it looks like Patrick now has a book out you can buy on Amazon.com: http://www.amazon.com/Housing-Trap-Buyers-Captured-Yourself/...

Put another way, even if there's an 0.9 probability that the advice there is wrong, buying a house is nevertheless the most significant purchase of your life for most people. It's also a very illiquid purchase, meaning it's difficult to sell and you need it to appreciate ~7% just to make back what you paid (that's because of Realtor(tm) commissions). You owe it to yourself to seek out a different opinion even if there's only a 0.1 probability it's accurate.

Edit with an addendum: My goal is not necessarily to get people to avoid Realtors(tm). This is not yet possible given the state of the market; I made some effort in that direction and was unsuccessful when I bought a single-family home on the SF peninsula. Instead, it's to get folks to realize that especially in coastal markets, they are likely not worth it, have minimal mandated training, and do not necessarily have your best interests in mind. In the long run, what I'd like to do is encourage HN readers to come up with ways to make real estate transactions more efficient. Some Realtors(tm) with deep knowledge will probably stay in the industry; most others will end up doing something more productive with their lives.

⬐ dnr

I bought a TIC in SF using Redfin as my agent. They rebate around half of their commission back to you (with a minimum for the amount they keep). It's not quite disrupting the industry, but maybe it's a start.

Part of the way they keep their costs down is letting you do all the searching and scheduling of visits on their web site, so all the agent has to do is manage the process once you're ready to make an offer. Not that that's so easy: I had a few complications with mine, and I've heard much worse stories.

My agent had just moved from the east coast, and I've lived in SF for several years, so I was more familiar with local market conditions than he was and I didn't get any value from that. But it was my first real estate purchase and I didn't know much about how the general process worked, so that was very useful to me.

⬐ burntsushi

You make a good point. The site is off putting, but it's worth it to spend a little time investigating. I'll check out the link that huherto gave me and maybe take a look at the book.

> It's also a very illiquid purchase, meaning it's difficult to sell and you need it to appreciate ~7% just to make back what you paid (that's because of Realtor(tm) commissions).

Indeed. Realtor commissions are a huge drag. I do somewhat skip over the part about the importance of a house appreciating in value because I'm not purchasing a house as an investment in which the primary goal is to make money. It's a purchase of a good whose main value to me is its utility as a domicile. A secondary goal is for it to benefit me financially. I acknowledge that this may be an uneducated opinion, but I definitely know what a house means to me, and its financial value isn't terribly high on that list. Perhaps that will change as I learn more over the coming years. (I'm considering building a house too. I get the feeling it would be financially better to start smaller, and then incrementally add to the house as we accrue the necessary capital to do it. I very much intend for my first house to be my primary residence for at least a couple decades.)

⬐ ars

> I get the feeling it would be financially better to start smaller, and then incrementally add to the house as we accrue the necessary capital to do it.

From my experience with other people who have thought like this, this is a mistake. One person wanted a 2 story addition, but couldn't afford it - so they put in a 1 story addition, but built the foundation so it could handle 2.

Needless to say they never added that second level even though they had funds - once you've paid for the roof, and the equipment and everything else (i.e. startup costs) adding that second level would have been just a small addition, but doing it now means starting over and the expense is no longer worth it.

Others have done that, but found the interface where the two connect to shift, which is unpleasant. Or the styles don't match.

Instead, build all the rooms you want, with exterior walls and roof, but don't finish the inside - no wires, no drywall, no doors, nothing except insulation, not even windows (when it's time for windows you just cut the exterior and add blocking on the inside). Close that section off from the rest of the house, and then when you have funds, and need, build it out.

The interior costs a significant amount, but the startup costs are much smaller than for exterior.

Note a possible problem: The inspector may object, I don't know.

⬐ DougWebb

If you're purchasing a house that you intend to stay in for a long time, reducing the cost of your mortgage as much as possible will save you far more money than the Realtor commissions will cost. The interest on a mortgage can easily double the cost of a home, and for the first ~third of the lifetime of the mortgage your monthly payments will be more interest than principal.

You reduce the cost of a mortgage by making a larger down payment, especially if you pay more than 20% in cash. You also want to avoid 'points' (which are just more interest) and to get the lowest interest rate you can. (A very good credit score helps a lot.) If you go for a variable-rate mortgage, read the fine-print very carefully; you want to make sure that the rate can't go up more than a reasonably small amount or more often than a reasonably long period.

You should also consider a lot of the non-purchase costs involved in home ownership. I wish the commissions had been the most significant expense I faced. Remodeling, repairs, improvements, decorating, re-decorating, and general maintenance added up to a large multiple of the commission I paid over ten years. And living in NJ, my property taxes have rising to nearly as much as my mortgage payments after a decade! I had never planned for any of that when considering what I could afford to buy.

⬐ declan

>I'm considering building a house too. I get the feeling it would be financially better to start smaller, and then incrementally add to the house as we accrue the necessary capital to do it.

I don't know anything about your personal financial situation, so this advice may be completely off-base. But perhaps buy a house that's unrenovated but structurally sound and then hire a contractor to renovate it to your specifications? At least if my experience a few years ago was any indication, you'll learn a tremendous amount about permits, appliances, electrical upgrades, fixtures, moulding, doors and windows, insulation, decks, landscaping, and how to manage a complex undertaking that's likely (depending on the size of the house and the geographic area) to run into the six figures and last at least half a year.

Then, a few years later, you can hire an architect and do everything right the second time around. :)

Also if you live in the SF bay area (and I know your profile says you're in Massachusetts), be warned that all the good land is already built on or unavailable for building or vacant and extremely expensive -- as in millions of dollars for just a lot in Portola Valley, Los Altos Hills, or Woodside. There was a discounted property for sale two blocks down from me a few years ago for only $800,000 (!). But there was an active landslide on the property and the town expressed some doubt about whether the owner actually had the legal authority under the deed to subdivide in the first place...

So if you have a liquidity event, you can buy that 800 ft^2 shack in a great location in Palo Alto for $2M, tear it down, and spend another two years and $2M building a nice modern 3,500 ft^2 house (1,000 of that may have to be underground because, well, it's Palo Alto). Otherwise, well, New Hampshire is a nice place to live! :)