Real estate prices

Not for a skilled trade and that is exactly what drives up wages. But as long as they have to compete with government free money for not working.......................

 

So if they are competing with the government then I'd expect them to definitely raise wages to attract more people. With higher wages, they can get more workers, and they can easily afford it with how high the housing prices are. They could make bank. Just offer $5,000 more than the competition.

 

The margin is more than that (maybe 13-22%) but it's a lot of work and risk to organize building a development. The contractor is not the one dealing with the risk or financial calculation.

Being a developer can be very lucrative, but it's far from a guaranteed money making operation. A few little permit delays could cut back your profit margins by 20%, for example. Or getting a bad contractor, some unforeseen building difficultly, the real estate market suddenly turning south, etc. Not to mention all your equity getting tied up in a project, and if for some reason there's a liquidity crisis, you may be forced to sell quickly at a loss.

The one who's risking their money is the one who's getting most of the profits.

If you're operating on a profit margin of 12% and the development unexpectedly loses just 6% of its value (which would not be very unusual), that's half your profits gone right there.

There's a difference between the home builder and the ones putting together and planning the project. The construction company has more work to do but has a lot less money at stake, their margins can be lower because their expected revenue from the project has a much greater degree of certainty.

That's right, the availability of previously built older home stock in the cities are depleted. That ends up raising the price for all buyers. First, because a new house costs more than an old one that's not in new condition, and second because there are not enough of the older lower-priced homes to the ones who would want to buy them, so that causes the prices to be bid up.

Guess who benefited from all this immigration? Home developers.
That led to an inflated economy, and probably was a contributing cause to the Recession.

It's simple, construction pumps lots of money into the economy and then everyone thinks the flow of money they're seeing will continue. So prices get driven up, because no one thinks they're going to lose their job.
The bubble leads to a sort of price inflation, which is why when the bubble finally started deflating the Fed was so worried about deflation. That's why the Fed pumping so much money into the economy didn't seem to cause any apparent inflation, it was basically because in the years or so before, the bubble had already caused that inflation.

 

How about we cut back government subsistance to able bodied people first because the government can just as easily increase it's support payments in order to keep people on such government dependence. You know like the Democrats like to do and are running on now.

 

Part of what you say is correct. The biggest obstacle a developer faces is the EPA. Getting permits to build is next to impossible. Concrete and lumber prices have been raising sharply for over a decade. Most communities will not permit SIDs anymore. This means everything must be paid for in the front end. A lot of things have to come together before a developer can start a project. In places like Seattle you have several layers of bureaucrats to wade through before you can start building. Adequate water, sever systems, electrical power, water runoff standards, etc all need to be met before construction of a single home can be started. This can push the lot prices into ranges that exceed the building costs.

Finding skilled tradesmen is really tough. Especially electricians. With all the new technologies going into new construction, the need for electrical workers has doubled.

Very few immigrants are buying new homes. They don't have enough money or credit. In truth, per person they require less housing than non immigrants. It is not unusual to see extended families of 8 or 9 immigrants move into homes that were previously owned by an American couple. It is part of the American dream to own a home. However that dream is getting harder to reach.

In short, there are many reasons for the rise in real estate costs.

 

They're taking the old homes.

Per person but not necessarily per family.

And that dream is becoming increasingly distant to many people in some parts of the country.

We're going to have to build lots and lots of homes to accomodate the increase in population, but who has the money for all that construction?

In some crowded parts of the country they don't even have the room.

 

That is the real problem. We are allowing a poverty class to inundate our society. Bringing in millions of immigrants who can not carry their weight. The slums are growing, crime is growing, air and water quality is dropping, and everyone wants a fix.

You can't have it all. If you want to open your borders, you are going to have to pay the price.

 

Too high. Gentrified nation thanks to the ever-growing wealth divide.

 

That's a terrible solution. What SHOULD happen, is what IS happening .. Americans need to adjust to having smaller places, or sharing. Just like the rest of the world has always done, or is rapidly learning how to do.

Ever paid any attention to these "house hunter" type tv shows? It's unbelievable what Americans expect in a home in terms of space .. even those with low budgets. They demand 'master bedrooms' as big as entire small houses in the UK, and freak out if a) it doesn't have double vanities in the en suite, or sin of sins, doesn't have an en suite (what Americans call a master bath) at all! I've seen young couples, buying their first home (no kids!), looking for houses that would accommodate 20 people in any other country. It's quite grotesque.

 

Too high for whom?