Government policy:
https://www.amazon.com/Zoned-Out-Regulation-Transportation-M...
> Zoned Out forcefully argues that the debate about transportation and land-use planning in the United States has been distorted by a myth. The myth that urban sprawl is the result of a free market. According to this myth, low-density, auto-dependent development dominates U.S. metropolitan areas because that is what Americans prefer. Jonathan Levine confronts the free market myth by pointing out that land development is already one of the most regulated sectors of the U.S. economy. Noting that local governments use their regulatory powers to lower densities, segregate different types of land uses, and mandate large roadways and parking lots, he argues that the design template for urban sprawl is written into the land-use regulations of thousands of municipalities nationwide.
Unfortunately I have to agree with the "myth": outside of urban bubbles like the one I live in, yes, Americans do prefer that. It is the cultural norm and everybody's expectation. To a lot of people you may as well be a Martian to defy it.
Incentives play a major role in defining such a culture. It doesn't have to be a positive seemingly self-selected incentive to want to live in the suburbs, but negative ones play a major role as well, such as the insanely high costs to own property... due to severe limitations on developing high density multistory buildings in cities, which is why modern cities are exclusively full of either a mega skyscrapers or a single family homes. Or the ease of an automobile-first lifestyle - which is almost always a reaction to poorly developed mixed density urban areas, causing urban sprawl, not a cause of it.
Just because a lot of people have responded to opting the easiest options given to them doesn't mean the easiest option was the result of market/personal choices. Rather it was ultimately a result of the intention, or more often unintentional, side effects of government policy, not a prolonged series of personal choice.
This is hardly limited to just urban sprawl and land development. Thomas Sowell has a brilliant book on how this same cycle has been applied across US culture/politics/economics for decades after WW2 - well beyond just real estate - to nearly every major sector which influences modern US lives: https://www.amazon.com/Wealth-Poverty-Politics-Thomas-Sowell...
If one considers government economic and social policy by their results, not simply their good intentions, this pattern can be seen in countless places. Yet the popular reaction by the media and political parties is so often to blame personal choice and 'unrestrained' markets for the output.
So naturally I am attuned to comments like this, and articles elsewhere, which talk about this subject.
Do you have any further insight into why you think there will be a recession in the next 2-3 years? Other than "it's a cycle and we're lined up for another one" ... Are there other market conditions that are making that more and more of a reality?
This was recently posted on HN and gives a good overview of indicators to look at though it's pretty blatantly alarmist.
Makes me definitely consider putting this housing search on the back burner. In my area we've seen massive price increases in just the last 3 years. I was on a tour of a home yesterday and the agent told me that the previous home tour was with a bay area investor who had cash on hand for the home.
Hard to compete with that. And maybe it's just the wrong time to be competing at all.
Buy gold?
If you need a general introduction, Dalio provides a nice starter for thinking about it: https://www.youtube.com/watch?v=PHe0bXAIuk0
A interesting proposed measure here based upon fundamentals IMHO to me is consumption investment ratio: http://necsi.edu/research/economics/econuniversal
All I can really say is be very sceptical of anyone who says they know for sure - I'm going mostly off my reading of cycle behaviors with some hand wavy harder measures (but economics is a terrible field and even the rigorously defined measures in the end have poor real-world predictive accuracy.)
I can't speak to its accuracy, but it's certainly a sobering read.
I get a loan for a rent house, I'll be paying it for 30 years.
I take your rent check, pay the loan fee, and invest the rest.
The market crashed. I lose my investment. My renters lose their job. No one can afford rent that matches the minimum loan payment.
Where is the real money again?
Disclaimer- I don't really believe it's that simple.
I would say things are at that point. So move to a different city. Success != The Valley
When tech workers get over their “I simply MUST live in the Bay Area, ugh, anywhere else is simply unliveable” mindset that in turn drives companies to concentrate in said area.
VC -> Startup -> Employee -> VC/Landlord
In any case, what you're talking about is renting office space -- the linked article is reporting on renting residential space. There's no evidence I can find to suggest that Silicon Valley style VC funding is secretly behind Essex Property Trust, AvalonBay Communities, or other residential REITs.
And they also own residential rental property out here too.
I can't speak to the sv, but this isn't an unsubstantiated meme in Boulder.
Hate to be the bearer of bad news, but the VC is the landlord. They're not stupid, and this setup is intentional.
It's a company town. History doesn't repeat itself but it rhymes.
You'd think VCs would push back on this too, because that's where their money is going.
VC -> Startup -> Employee -> Landlord.