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The median home sale price in the US has jumped by nearly 30% since the end of 2019, hitting $420,000 this spring.
At a time of rising property values globally, the leap has been one of the most dramatic in the world, according to the International Monetary Fund.
And that’s not factoring in the added costs from higher interest rates, which now stand at roughly 7% for the 30-year, fixed-rate mortgage that is typical in the US, up from about 3% in 2020.
Homebuyers today need an annual income of more than $100,000 - well above the country’s household median of about $75,000 - to comfortably afford a home in most places in the US, research firms such as Zillow and Bankrate say, and face monthly payments that have roughly doubled in just four years.
REITs and REOCs aren’t helping by treating the housing market like the stock market. No more than 30% of their sales can occur within four years of purchase, encouraging them to hold properties. With respect to property that consists of land or improvements, the REIT must hold the property for two years for the production of rental income.
https://www.cielam.com/insights/capturing-the-entire-real-estate-value-chain-reits-reocs-and-their-comparative-analysis
Their presence in the market doubles in size every four years.
https://www.yalelawjournal.org/article/a-theory-of-the-reit
I’ve said it before but I’ll say it again, necessities for living should not be an investment vehicle!
The pillars of society shouldn’t be put on the market. It’s inviting catastrophe. Security, medicine, education, jurisprudence and the post are public necessities. A convincing argument can be made for utilities as a right, which is to say, we legislate a mandatory quality of living, a raised floor. Shelter writ large would fall into this category even tho shelter is already a right, recognized universally, except in the US and wartorn unstable countries.
Simplified, our natural, innate rights our what we are capable of if left alone in nature. I can go collect water and nothing can stop me, or I have the right to enact violence to prolong my own existence. Thought play that out in every way possible if you want, but I have better ways to spend a day, or a lifetime. Civilization is compromising access and violence. It’s saying we’ll make these available, so no violence.
Capitalism for luxury markets are fine, shit, should even be encouraged. Capitalism to provide grade schools or morgues is not. We don’t want a profit margin in sewer systems or fire departments, or post offices. Those are best kept services and not leveraged against us (the “customer base”) for max capital extraction. No one wants uncontrolled fires, or sewers backing up, or dead bodies piling up in the streets.
We lost our house and adjacent workshop last July 5th, at 4:30@am to fire. Total, complete, devastating loss. We woke up to the bedroom wall erupting in flame. 60secs after immediately running out of the house, the roof collapsed. 15min later the 150ft Doug firs we live around are in fire, flames 80ft up. It …was… a sight, let me tell you. I hope no one has to experience a morning like that, sitting on the ground, burnt, bleeding, exhausted from futilely trying to fight it, in the glow of their lifes work burning 100ft into the air, too exhausted to feel anything else just holding their naked wife as she’s, rightfully, in hysterics. We survived, mildly injured, some of our pets did not. No keys. No phones. No wallets. No clothes. No shoes. Nothing. We work for ourselves, and our income, that went up too. Complete desolation… Hello my old friend despair. I had never seen you in such true lighting before.
My point: now, in a pure capitalistic environment, who do you think pays the fire dept to put that out? Me? With what? No, in pure capitalism my neighbors would be charged to protect their houses from the fire, that was quickly spreading into a forest fire. And ultimately if just one or two neighbors weren’t home or reachable, and it was allowed to spread, then it would become unmanageable and everyone, those who paid included, would suffer the same loss. Because control over nature is an illusion. The only safety we have is in solidarity and capital does everything it can to obfuscate that fact, which is definition evil.