shortage of affordable housing for young adults

What about just renting a room? In my area for $500 one can get a furnished room with utilities and high speed internet and full cable and on a lease if one looks around and no 'roommate' surely a working young adult can earn that and enough to eat and take mass transit. I have no credit rating but have housing references that are good and a government disability check so I can assure payment each month which is gold in that market and a older disabled adult male is not seen as trouble. A young person could likely do just as well if they are nice and have a job with good references so what is the issue with that arrangement.

I will add governments shut down tenement hotels and rooming houses in cities for more desirable housing so its partially the fault of a lack of proper city planning as well.

 

Sounds cheap where you live.

For me, in Cambridge, a studio flat costs £800 a month. A minimum wage full time job, pays £1,000 a month.
Catch 22 however, unless you pay 6 months in advance a landlord will not accept you unless your wages are 3 times your rent.

In the outback I can get cheaper, but there is no work.

So essentially unless you have a career going, you must live in a shared house.

 

Here we had high inflation in 1979 and mortgages were 14 to 16% interest, credit cards out a sight. Only savers benefited with good income on bank deposits.

 

Why do conservatives no absolutely nothing about the constitution?

 

Savers benefit from deflation.
Every year their £'s are worth more.

Borrowers benefit from inflation, every year their debts are worth less.

As you correctly note.
The lower the interest rate on your loan, the better for you and the worse for the lender.

If inflation gets too high, above 2% perhaps, lenders will likely up their rates to compensate. Interest rates however are dependent on other factors also. The availability of money for example. If no lenders, (or for that matter credible borrowers) then supply and demand dictates that rates will be high.

In 1979, I simply could not get a loan at all. Creditworthiness was a much higher bar.

So for a saver, income on their savings = interest rate - inflation rate (- tax).
The higher the rate of inflation, the less they earn.
In many countries these days, inflation rate > interest rate which means savers are effectively losing money every day they leave it in the bank or under the mattress.
..

 

For the saver it's the interest income that buys groceries right now when you're hungry. Not much interest income presently. 12% interest was real good "pay the bills" money in the late '70's.

Of course it was hard to make the rent or mortgage payment, but for the older folks with a paid off mortgage 12% interest income was heaven. I remember how hard it was to make that mortgage payment.

 

Interest income right now doesn't buy any groceries. Sorry but you have been misinformed.
Each day as a saver, you become more hungry. Less able to buy groceries.

And this is because currently inflation rates are higher than interest rates. The price of food is going up faster than the balance of your savings account.

Inflation rate = 3%.
Interest rate on savings = 1%.

So each year your savings buy 2% less than they did last year.

It should be noted that banks are run for profit hence borrowing rates are higher than savings rates. So while in 1979 the mortgage rate was 12%, the savings rate was only 8%.

Inflation rate in 1979 however was 13%.

Meaning effective (or "real") savings income was 8%-13% = -5%.
Savers were getting screwed massively by inflation in the 70's.
A Mars bar used to cost 3p in the 70's, now it costs 95p.
My savings however are not.... 32 times as big to match this.

Conversely the real mortgage rate was -12% + 13% = 1%.
In 1979, you gained 1% a year simply for being in debt.

 

Well, okay then. But old folks savers are in general interested in making it from here to dead, not dying wealthy. They are more fearful of too much life at the end of their money than too much money at the end of their life. So money to spend in the pocket for groceries now is better than empty pockets, and high interest helps.

As Reagan tightened the money supply and got interest rates down in a long secular trend, the old folks complained about how hard it was getting to make it month to month. These old folks didn't give a damn what the universities, financial advisors, and magazines said.

 

High interest rates help savers.

Old or young.

Why anyone would give a damn about what a university says is quite beyond me. WTF?

I expect financial advisors told them to make more profitable investments, the stock market for example.
And I expect that is what a great deal of them did.

Get a mortgage is the most common financial advice these last 3 decades.
The government is in debt and it has rigged the game to advantage itself.
Surf that wave.

 

People need to both save and invest. They need to save enough to sustain themselves for a year or so. And they need to invest for the long term in instruments that hopefully have an ROI greater than inflation and other costs. Savings is going to be cash installments while long term investments can be both cash and debt. On the cash side people can invest in stocks and other investment portfolios. On the debt side they can buy homes and property and even start businesses.

 

Semantic quibble.
While getting into debt is an investment, the person borrowing the money isn't the one making it. He is the person being invested in.

Investments can be good. But higher risk. Also cash is important for picking up bargains.
I typically save up cash for a recession and then buy as much bankrupt stock as I can at that time. Have access to money when others have none.

 

Mama said buy straw hats in the winter time.

 

Sounds reasonable. I suppose it depends where you live, particularly which region of the country you live in.

Where I have lived $500 is definitely on the low end, and I can tell you it's not as simple as just going out, responding to the ad and getting the room. Again, just from my observations, probably in a different region from you, for every room listed at that price there are already five people who responded to the ad in the first three days, so you're competing against other people. You'll likely be looking for a month or two before you find a place that selects you (and a place you're willing to live in, because there can be some pretty creepy or sketchy places).
It can also be challenging to see all these places and keep appointments if you don't have a car.

I do want to point out that even $500 could be just a little bit of a stretch for an eighteen or nineteen year old just starting out. (And then there's often a share of the utility costs they may have to pay on top of that)
On minimum wage that's still 17 hours a week they have to work to pay for the room, and many of these young adults are only working 25-35 hours a week (on an erratic schedule) because that's all the employer has available for them.

 

A big part of the problem of affordability is the flat real wages of the last 40 years.

 

do the liberal think if we shipped 30 million liberal illegals home wages would go up or down?

 

They would probably go up, but your assessment and "solution" is bogus, slanted, biased, uninformed, unreasonable, and inhumane.

 

I guess I don't understand your implication. I have never heard of an economic optimum population . Reducing the population would also reduce consumption and the labor needed to provide goods and services to the remaining population.

 

So what is driving affordable housing to unaffordable? If the cost of housing is rising faster than the cost of labor what is driving the rising cost of housing?

Is it the lack of new construction to accommodate an increasing population? The cost of construction for various reasons? Or is there some other reason housing costs are rising?

 

A few things.
for example.

Population increase. The availability of resources. Unused land is an ever decreasing commodity.

Lose credit. The more easy it is to get a mortgage, the more people are able to buy houses.

Changes in social expectations. I expect to have my own place, not live with my mum and dad forever.
I expect my children to have their own bedrooms. My grandparents to live elsewhere.

Upward mobility. I work in other towns, go to university in other towns. I cannot live with my mum and dad and do this.

 

I think gentrification plays into it. Also, there were quite a few years since 2007 when housing prices fell. A recovery from the lows means rising prices. Meanwhile the real median wage is still relatively flat. All that means affordable housing becoming unaffordable.

 

1) if population goes up while land quantity stays the same prices will go up.
2) land is expensive, increasing libsocialism makes us poor so fewer of us can afford expensive land.

 

Actually, the problem with a lack of affordable housing is local governments refuse to zone appropriate amounts of area designated solely for affordable housing. Most governments are afraid of voters who most always say NIMBY!! A great example is Marin County, CA in which George Lucas owns land and not only wants to donate the land, but also pay for the total cost of development, for affordable housing on that land...neighbors absolutely refuse it to happen!

 

If you have evidence of that I'll pay you $10,000. Bet?

 

You tried that with me and lost, and you haven't paid up yet.

 

http://www.westerncity.com/Western-...Solutions-to-the-Affordable-Housing-Shortage/

Principal Causes of the Affordable Housing Shortage
Local governments are just one piece of the complex scenario that comprises the housing development process. Cities don’t build homes — the private sector does. In California, local governments must zone enough land in their General Plans to meet the state’s projected housing demand; however, cities don’t control local market realities or the availability of state and federal funding needed to support the development of affordable housing. This is true not just in California but nationwide, as I have observed firsthand in my work with the National League of Cities in Washington, D.C., and as a former deputy mayor for the City of Indianapolis.