# The American Dream Without a House? Believe It **URL:** \ **Category:** Macro Economic Trends and Risks\ **Created:** [September 10, 2024, 11:35pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692 "2024-09-10T23:35:45Z")\ **Posts on this page:** 17\ **Page:** 2
**Author:** ![FlyingCircus](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/flyingcircus/32/3941_2.png) [@FlyingCircus](https://discussion.fool.com/u/FlyingCircus)\ **Post date:** [September 12, 2024, 3:12am UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/21 "2024-09-12T03:12:57Z")
The misguided programs of low-income housing affordability including relaxing loan repayment standards into garbage like zero-doc loans and 0% ARMs in the early aughts ended up costing us over a trillion dollars in bank bailouts and capital losses in investment accounts from 07-16. (_Suuure we got paid back…_) The moral hazard factor - when “the government” (meaning us) will bail out the risk takers there’s no point in not taking risk. The misguided programs of government-backed student loans are similar - the colleges have no incentive to manage costs because they get paid, helping drive up college costs 10+% annually for 20 years, and now given the current loan forgiveness, no one could be blamed for taking advantage of the gift and not paying them back. Gov’t says we’re good, right? … Maxine’s at it again with affordable housing - taxpayer money (sorry, debt) in $20K giveaways funneled down to builders with no requirement to keep costs down so demand keeps going up at any price. Anecdote: 1800sf basic box house here in (relatively wealthy) SE NH on 2/3 of an acre: $725K. That’s $400/sf. My first house 33 years ago was 1800 feet for $155K. 4.8% annual inflation, nearly 50% more than “core” inflation and wage growth. Public school teachers (around here, anyway) are absolutely screwed, limited chance to live anywhere nearby unless the spouse has a high-paying job. Layer in hundreds a week for daycare/childcare! But what can you do? Society can’t go back to a cash economy, people can’t frequently just move to where it’s “cheap”. Areas without good paying corporate jobs will stay cheap, decline or stagnate without high-paying “remote work”. It’s actually worse in Europe, isn’t it? What do we do, government-paid for and run housing? Individual houses only for the truly rich? Yeaahhh that’ll work… ---
**Author:** ![flyerboys](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/flyerboys/32/2123_2.png) [@flyerboys](https://discussion.fool.com/u/flyerboys)\ **Post date:** [September 12, 2024, 3:13am UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/22 "2024-09-12T03:13:53Z")
> [@pauleckler](#): > > a recognized need. What is the best solution to the problem? Smash concentrations of market power and help people lower their media formed “needs” to a reality rather than status based level. Dickens is always cheerful and helpful to understanding: [![](https://us1.discourse-cdn.com/motleyfoolfree/original/3X/0/9/0993a9302434eec5af014a9b6640d99e12290778.jpeg "David Copperfield, Mr and Mrs Micawber") ](https://www.youtube.com/watch?v=6NPgthf4TDw) But then I am a modern puritan who always shared bedrooms with siblings, did not own and rarely used a car until i was 25, and finds desire for most physical objects from hats to barbecues to be, uhmm, mistaken. d fb ---
**Author:** ![steve203](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/steve203/32/3302_2.png) [@steve203](https://discussion.fool.com/u/steve203)\ **Post date:** [September 12, 2024, 1:22pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/23 "2024-09-12T13:22:09Z")
> [@FlyingCircus](#): > > The misguided programs of low-income housing affordability including relaxing loan repayment standards into garbage like zero-doc loans and 0% ARMs Exactly right. Affordability always seems to manifest as “innovative financial products” to enable paying the higher prices the “JCs” want, rather than letting the “JCs” go begging for customers, unless they offer products at a more reasonable price point. Steve ---
**Author:** ![UpNorthJoe](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/upnorthjoe/32/1083_2.png) [@UpNorthJoe](https://discussion.fool.com/u/UpNorthJoe)\ **Post date:** [September 12, 2024, 1:30pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/24 "2024-09-12T13:30:34Z")
I’m not a “modern puritan” by any means, but am not into status symbols at all, and it seems like the marketing of the housing industry ( builders, realtors ) is all about pushing status. I grew up in a house with 8 people in it, and as a youngster loved just being outside where there was room,lol. ( away from tormenting older siblings, lol ) And I’ve concluded as I’ve grown old that health and being able to fully use your body still, that is the greatest wealth. Do not care to be a slave to my property. ---
**Author:** ![pauleckler](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/pauleckler/32/2906_2.png) [@pauleckler](https://discussion.fool.com/u/pauleckler)\ **Post date:** [September 12, 2024, 3:43pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/25 "2024-09-12T15:43:54Z")
Yes, builders find it most profitable to build larger homes on larger lots in prestige communities for those who want more space. But they also build town homes and in my area ranch style homes with smaller sizes and budgets. Buyers do have choices. If smaller homes are selling like hot cakes, what is holding back construction? ---
**Author:** ![FCorelli](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/fcorelli/32/47614_2.png) [@FCorelli](https://discussion.fool.com/u/FCorelli)\ **Post date:** [September 12, 2024, 3:54pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/26 "2024-09-12T15:54:32Z")
> [@pauleckler](#): > > If smaller homes are selling like hot cakes, what is holding back construction? The need to keep prices unnaturally high ---
**Author:** ![pauleckler](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/pauleckler/32/2906_2.png) [@pauleckler](https://discussion.fool.com/u/pauleckler)\ **Post date:** [September 12, 2024, 4:17pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/27 "2024-09-12T16:17:34Z")
Are you implying price fixing? Or merely that rising costs require higher prices? ---
**Author:** ![spinning](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/spinning/32/3692_2.png) [@spinning](https://discussion.fool.com/u/spinning)\ **Post date:** [September 12, 2024, 6:15pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/28 "2024-09-12T18:15:08Z")
> [@pauleckler](#): > > If smaller homes are selling like hot cakes, what is holding back construction? In many areas, zoning. ---
**Author:** ![FlyingCircus](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/flyingcircus/32/3941_2.png) [@FlyingCircus](https://discussion.fool.com/u/FlyingCircus)\ **Post date:** [September 14, 2024, 5:16am UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/29 "2024-09-14T05:16:01Z")
> [@pauleckler](#): > > If smaller homes are selling like hot cakes, what is holding back construction? Profit. They don’t make as much money building a 1500 sf house vs a 3000sf house and it takes almost the same time. ---
**Author:** ![pauleckler](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/pauleckler/32/2906_2.png) [@pauleckler](https://discussion.fool.com/u/pauleckler)\ **Post date:** [September 14, 2024, 3:03pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/30 "2024-09-14T15:03:52Z")
Yes, but lot size and cost are big factors in cost. ---
**Author:** ![steve203](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/steve203/32/3302_2.png) [@steve203](https://discussion.fool.com/u/steve203)\ **Post date:** [September 14, 2024, 4:50pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/31 "2024-09-14T16:50:00Z")
_Yes, but lot size and cost are big factors in cost._ Yes. But, with a lot of a given size, you can built a 1100sqft ranch, or a 3300 sqft 3 story mcmansion, Steve ---
**Author:** ![Kingran](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/kingran/32/2318_2.png) [@Kingran](https://discussion.fool.com/u/Kingran)\ **Post date:** [September 14, 2024, 5:08pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/32 "2024-09-14T17:08:40Z")
> [@intercst](#): > > I’ve found that if you concentrate on putting your money in assets like stocks which have a much higher return, and much lower transaction costs than owning a home, you’ll be able to rent a castle if you think you need one. While in theory and in practice I agree to this. I also want to caution. For most folks who are not stock market savy, house is a great investment. It provides a place to live, it is an anchor to family, many have very fond memories of growing up in a house, so there is an emotional value. Financially also, even if it appreciates by 2%, since most folks buy with 80%, 70% leverage the down payment is able to punch much higher with that 2% appreciation. Many folks don’t have the discipline to invest excess money, rather they will spend it. Mortgage payment, SS (payroll deductions) are very effective in making folks save. ---
**Author:** ![Kingran](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/kingran/32/2318_2.png) [@Kingran](https://discussion.fool.com/u/Kingran)\ **Post date:** [September 14, 2024, 5:11pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/33 "2024-09-14T17:11:57Z")
> [@pauleckler](#): > > f smaller homes are selling like hot cakes, what is holding back construction? Actually in many communities the local administration (elected by existing homeowners) discourage multi-family, small-house building. Small houses are associated with poor people, and law and order problems. No one speaks about it. But I have seen this first hand with Toll Brothers. They build over 500 houses in a community and had only 2 2 bedroom houses. So when I asked about it, they are like they had to fight very hard with the city even for this. City wanted them to build big!!! ---
**Author:** ![steve203](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/steve203/32/3302_2.png) [@steve203](https://discussion.fool.com/u/steve203)\ **Post date:** [September 14, 2024, 5:14pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/34 "2024-09-14T17:14:49Z")
_City wanted them to build big!!!_ Build big. Price big. Tax big? Steve ---
**Author:** ![FCorelli](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/fcorelli/32/47614_2.png) [@FCorelli](https://discussion.fool.com/u/FCorelli)\ **Post date:** [September 14, 2024, 5:29pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/36 "2024-09-14T17:29:39Z")
> I just read an article claiming that the median size of new homes in the U.S. has dropped 8 of the last 9 years and and is expected to drop again this year. Maybe new home buyers are buying what they can afford in the face of prices rising faster than wages. Maybe older buyers are seeing homes as less of an investment in this market and more like an expense to be managed As I was reading I was thinking, builders would have to know that first, then build for it. I think the more likely reason new homes have been shrinking a few sqft for the last 8 years is because of “shrinkflation.” Charge the same contrived prices but give the buyer less. Just don’t make it look like less . ---
**Author:** ![steve203](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/steve203/32/3302_2.png) [@steve203](https://discussion.fool.com/u/steve203)\ **Post date:** [September 14, 2024, 6:38pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/37 "2024-09-14T18:38:13Z")
> [@iampops5](#): > > There was no real market for top quality small homes. In America, small homes are for poor people. As the saying goes, size matters. Yup. Make it big and flashy, but, still cheap. It is probably impossible to buy a home from a developer that is well built, because the developer would have built for the lowest common denominator, meaning as big, flashy, and cheap, as possible. You could go to a builder of good repute, and have the house custom designed and built. The house I mostly, grew up in, is this one, built in 58. Custom built to spec. All hardwood floors except kitchen and bath. All plaster walls, and well laid plaster too. When the Ma Bell guy was installing the wall phone, he commented on how solid the plaster was. Cove ceiling in the living room. All floor joists heavily crossbraced. All wood, double hung windows with separate storm windows. Real brick on the front, and in the fireplace in the living room. Redwood siding. 1984 pic. ![1984](https://us1.discourse-cdn.com/motleyfoolfree/original/3X/a/7/a7236ebad16bad42b7d85428f13cb30336be4bc7.jpeg) Pic of the living room, when a later owner had the house listed for sale. The brick around the fireplace has been painted same color as the wall, but that brick extends from the floor to the ceiling. You can also see the cove ceiling. ![2709718_01](https://us1.discourse-cdn.com/motleyfoolfree/original/3X/f/5/f5890be0526e5b06e7b4cd6ca2bb2dd6f262b12f.jpeg) ---
**Author:** ![pauleckler](https://sea2.discourse-cdn.com/motleyfoolfree/user_avatar/discussion.fool.com/pauleckler/32/2906_2.png) [@pauleckler](https://discussion.fool.com/u/pauleckler)\ **Post date:** [September 14, 2024, 11:43pm UTC](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692/38 "2024-09-14T23:43:06Z")
> [@steve203](#): > > _City wanted them to build big!!!_ > > Build big. Price big. Tax big? I live in Wildwood, MO, one of Missouri’s newest cities. Only 25 years old. Voters very much want it to retain its rustic character. They prefer large 3 acre lots to keep the population down and avoid congestion, traffic, pollution, and all the other problems of high population density. Its a constant tension point as land owners want to sell for top dollar and developers keep asking for zoning variances to allow smaller more affordable homes. Such is life in the less developed areas of St. Louis County. [Previous page](https://discussion.fool.com/t/the-american-dream-without-a-house-believe-it/108692.md?page=1)