I slightly disagree. The land definitely factors; I don't think we can argue that. But there's also a lot of value of a house just being on the land, no matter its quality (ignoring complete dilapidation).

If labour and material costs are also high that increases the value of houses that are pre-existing. It means the buyer does not have to pay extra for and wait for a house to be built, which has some value. Also, there's a certain tolerance that I'm sure many people, if I may project, have for how crappy of quality a house actually is. They just want a damn place to live and call their own. Especially when the market is not in the buyer's favour.

At least that's how it all seems in Toronto. In the city of Toronto proper, a detached house selling around $1,000,000 is almost guaranteed to be of relatively bad quality right now.

Yes but if prices rise, its 90-100% of the land price increase, and 0-10% of the house itself. That is land with all network connections and permit to build the house. It basically goes up only with material and labor costs.

House is often a necessary evil - its never what buyers imagine as ideal, but in comparison with going through the hell of building one's own (or also adding tearing down the old) its an acceptable compromise for many.

Life is too short, and no house is worth destroying a marriage.

This depends on where you live. In rural areas, and dying towns (most of america geographically), land prices have stayed about the same over the last decade or so. However, materials and labor have increased a lot. So there are certainly situations where the building itself inflates in value more than the land.

I heard an anecdote from a rural insurance agent that the fire insurance is crazy because repairing/rebuilding a house after a fire costs much more than the market price of the house + land, or an equivalent house + land nearby - the issue is that (in some areas) the rural house prices there are way down as there's no demand and everyone's leaving, while the costs of construction are sky high.

So if they offer a policy that covers the market value of the house, that's much less than what it would cost to repair/rebuild (so insured people can't afford to get their house back after a fire), and they don't want to offer full repair/rebuild value, as that incentivizes people to just burn the house down because in that case the insurance payment would be much more than what they can sell the house for.

To steal a phrase from Matt Yglesias: we only have so much "throughput" from land prices to housing prices because we refuse to build vertically.

Slight correction - people don't want to live in vertically built accommodations. Everyone wants a nice little house they don't share with anyone. Can't exactly blame them.

i just have trouble understanding this angle. i grew up in the suburbs and moved into the city during year 2 of my career. i rent a home with 3 roommates even though i could afford that SFH you’re describing. why does a person desire to live in the city for any reason besides for the density?

“jobs”, “good food”, “nightlife”, “dating” and “social opportunities” are all things i hear. the last two are a direct result of density. the first 3 are only possible as indirect results.

anecdotally, the price per sqft of townhomes exceeds that of detached homes in several Seattle neighborhoods. several confounding factors, including the year of the building, but in general that suggests a preference opposite to what you claim. or at least, that, in the face of constricted supply we can’t really tell where the preferences truly lie.

If we're looking statistically, detached homes are more expensive than apartments pretty much everywhere once you take into account location. And having a family with a toddler myself, trust me, apartments are not the best fit for that situation.

Anecdotally, in Australia, post COVID both rent and real estate in regional areas have gone up dramatically - much more than in cities - rapidly pricing locals out and forcing them to move elsewhere and sometimes find temporary accommodation. Now that WFH is more normalised and either want a quiter lifestyle or straight up can't afford houses in major cities, so they are moving to smaller towns instead.

My own preferences are fairly different but I can't argue with data.

You requirements for a good life change as your age changes - what you value during your 20's is not the same as what you value in your 40's, in the same way what you value in your 20's isn't the same as what you valued in your toddler years.

Everyone wants to live on an acre in the city in a palatial mansion.

But if you have to decide between an hour commute and living vertically plenty of people would choose to live vertically.

But factor in hybrid remote and the palatial mansion has become an option again - what's 2 days a week of a hellish commute if you can stretch out on a lawnchair the other 3?

I don't know... The suburbs are really popular

Most of the people I know who moved to the suburbs did so for better schools and a larger house.

Eh, I don't think that's true. Maybe for older generations, but for people in their 20s and 30s I suspect the opposite is true. People want to live in cities and if they've done any research at all don't want to live in suburbia since it's a living hell.

People in their 20's and 30's eventually reach their mid to late 30's and realize living as a couple with a child or two running around in an apartment, taking elevators to walk the dog or have the kids play in a park (a park probably with homeless people laying on benches if it's the parks I'm thinking of), and folding a stroller to walk down the subway is -- a giant pain in the butt.

And eventually those people visit friends or see pictures on social media of people similar to them with large back yards, land and big kitchens - and say, shit, maybe we should look into this.

As it happens, just possibly a black swan pandemic event keeps those folks indoors with their kids and dogs, with their nonplussed neighbors, children running around behind Zoom conference calls, and pictures on social media of people with houses and backyards causing massive envy...

And welcome to today.

That's the housing situation in the suburbs and exoburbs. This is BEFORE even even talk about the insanely low interest rates on offer during this time.

If we’re going to ban things because “trust us, you don’t know your own preferences” or “you’ll change your mind later” then we’d better start with alcohol and cigarettes. Apartments would be pretty far down the list.

This is mostly true in the US. There is, and has always been for the last century, a population of city dwellers who don’t care to ever own a house. But outside of the cities in the suburbs and rural areas owning your own home is seen as the thing that makes you an established member of a community.

Living in the city only implies renting because condos are so rare, only the richest few can afford them. Allow condos to be as abundant as single family homes - what we’re asking here - and that would easily change.

Depends on upbringing. I grew up in tall buildings, and am comfortable in that environment. When I had an opportunity to buy a detached house, I saw how much work it is, and it felt a bit lonely there, so I decided it's not for me.

I don't think that's true. Obviously a lot of people pay a lot of money for them. I think even the most craven NIMBY would adore a high rise condo if it had comparable square footage.

It's everyone else's vertically built accommodations that attract the hatred.

In the UK the fall out from the Grenfell fire has made even low rise flats look a very poor investment.

And the experience of high rise social housing from the 60's and 70's shows that that tower blocs do not solve housing problems.

I'm not sure that we build at all. Out, up, down, or anywhere else.

> It’s not the house that’s worth more. It’s the land.

They are both worth more over time.

To build a new house just like the old one will cost more since labor went up and materials went up.

Somewhat true if you mean not adjusted for inflation. But that means you can buy more too with higher wages (except low-wage jobs haven't kept up). If you mean rare woods and stuff, maybe so. But compare the labor part of modern forrestry to the stuff 130 years ago:

https://www.komatsuforest.com/-/media/komatsu-forest/images/...

A machine grabs the tree, cuts it from the ground, rolls it through a thing to remove all the branches all in just a few rapid smooth movements.

to build an old house like the old one will be impossible because you can't put asbestos in your walls and and have to comply with other build codes that were introduced over the last 120 years.

It’s also partly the monetary unit being worth less than 20 years ago. $2 20 years ago is about the same as $3 today.