What does it mean for there to be a housing shortage?
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This is a pretty ridiculous chart courtesy of Kevin Drum:
Hey it’s a big country and a lot of it is empty.
On the other hand, here’s a little story. A friend of mine lives in what was considered a relatively unfashionable part of Boulder until fairly recently. The house three doors down from him — a three bedroom two bath 65 year old 1700 sq ft. ranch on a 7000 sq ft lot, which is typical for this neighborhood — sold for $165K in 1994. It was renovated over the next few years, and sold for $235K in 1998 and $380K in 2002. This represents slightly less than a doubling in value, inflation-adjusted, over this eight year period. I’d estimate that half of that doubling was true appreciation, while the other half was accounted for by the cost of renovation/updating.
In the 20 years since the house hasn’t been altered much, although the owners added a fancy roof a few years ago that probably ran something like $40K. So this 1700 sq foot house with 20 year old nice but not high-end renovations in a B location went on the market a couple of weeks ago.
Asking price: $1.395 million.
It sold for cash for $1.805 million.
The median price of a single family house in Boulder in 1990 was $125,000, which you can double for the purposes of constant dollars. The median price of a house right now is probably over $1.5 million. That’s the housing crisis.
Sure you don’t have to live in Boulder to work there, but it’s not like you can live in Kearney Nebraska. “Affordable” housing is impossible in Boulder, because the NIMBYs will fight any kind of dense housing and any incursion on the massive swaths of open space surrounding the city a lot harder than they’ll fight revenant fascism, which at least isn’t hurting real estate values, at least not yet.