patrick.net

MolotovCocktail says

Previous Leg actions have contributed to the current insurance fuck up. So why do you think further bandaids are not going to fuck with it more?

No, weak enforcement of the law prohibiting Key Personnel of "bankrupt" insurance companies from forming news ones.

These guys declare bankruptcy at the first gust of a hurricane. Supposed to be banned for years, come back in the aftermath running a new company.

They got wristslap fines. Also, the state legislature made a new law so that homeowner-hired independent adjusters cannot work on contingency to protect the scamsurance companies.

The real answer is to make homeowner's voluntary.

AmericanKulak says

The real answer is to make homeowner's voluntary.

Good luck getting a mortgage then.

MolotovCocktail says

Good luck getting a mortgage then.

Just have the FHA write loans with no insurance.

It's not like insurance pays anything. They just cancel the policy after 17 years of payments unless you've got $50k of legal fees to put up.

MolotovCocktail says

AmericanKulak says

The real issue in Florida is homeloaner's insurance though

Previous Leg actions have contributed to the current insurance fuck up. So why do you think further bandaids are not going to fuck with it more?

Have to examine the number of households versus housing stock or inventory.

How many of those homes are at least 50 years old ? 75 years old ?

Here is a chart for USA housing statistics since 1975.

AmericanKulak says

FHA "You don't need homeowners to apply for a loan"

Oh I see. More government idiocy to 'fix' prior government idiocy. My point stands.

MolotovCocktail says

Oh I see. More government idiocy to 'fix' prior government idiocy. My point stands.

Nah, we're just shifting the standards from "Pay my insurance special interests that donate to my campaign" to "You don't need insurance" We at least got rid of one special interest, though the builders are still there.

Another solution is make insurance companies pay premiums back plus 7% interest compounded per annum when they cancel you.

After all, they took the money for 10 years and never paid out, so service was never provided. Refund + opportunity cost loss is very fair.

7% is very generous - too low even - because insurance companies take your premium and invest much of it and get far better deals than a retail buyer could ever.

AD says

Here is a chart for USA housing statistics since 1975.

So? What are you? DeficitHawk's alter ego?

AmericanKulak says

Nah, we're just shifting the standards from "Pay my insurance special interests" to "You don't need insurance"

MolotovCocktail says

AmericanKulak says

Nah, we're just shifting the standards from "Pay my insurance special interests" to "You don't need insurance"

"No, don't eliminate one special interest from the equation. We might as well keep them all and not intervene".

Dude, making insurance voluntary IS downsizing government regulation.

Another one I want is cops can't cite for not wearing safety belts, at least to over 18 -year olds.

Let Allstate and StateFarm pay to enforce their policies.

If you have StateFarm and the StateFarm "Good Neighbor" Crown Vic flashes it lights, they can fine you the money.

But not County Sheriff or City Police.

Why should taxpayers pay to enforce insurance policies? Let Allstate use it's Good Hands to pay for the Allstate highway patrol to ticket Allstate customers.

"Ah shit, everybody buckle up, I see the Yellow Jacket State Farm Interceptor"
"Don't we have Allstate?"
"No I changed it last month"

I never paid less for insurance than when I lived in NH. Auto Insurance wasn't mandatory.

The further away Good Hands and Good Neighbor are from me, the less they can molest and spy on my wallet.

Getting them out of my house is even better.

People have lots of theories as to why America became so risk-adverse, but there's one huge industry they've ignored.

AD says

Yep, another issue.

The average home today is far more expensive relative to income, and far older too.

I wonder how Hedonics is gonna play "You're actually better of because" with that piece of data

AmericanKulak says

Dude, making insurance voluntary IS downsizing government regulation.

The government shouldn't even be in the fucking house lending biz at all.

MolotovCocktail says

The government shouldn't even be in the fucking house lending biz at all.

Yep. But making insurance non-mandatory is one more big step.

I can't even begin to think how many nanny state laws in our country are actually due to Insurance Companies lobbying.

AmericanKulak says

But making insurance non-mandatory is one more big step.

Where is home insurance a government mandate? Around here, the only entity requiring home insurance is one's loan company. If you have no mortgage, no one requires you to have insurance. Not even flood insurance. Not prudent, however.

AmericanKulak says

The average home today is far more expensive relative to income, and far older too.

yep average age about 45 years old for a USA home

I agree as far as currently being more expensive as far as monthly housing costs (mortgage, property tax and insurance, HOA fee, etc) as a percentage of household income

but the air is gently being released from the housing balloon or asset bubble while household income continues to increase annually by about 2.5% ; I see this with townhomes on the east end of Panama City Beach

........

FHA loans require insurance, and as the biggest single lender, set the pace.

Get the FHA out of the insurance business. They can insure their loan value... which would have a beneficial effect. Imagine being an insurance company asked to insure a tranche of certain... risky profiles.

Or get the gov out of home loans entirely, which would also have many beneficial effects.

Don’t forget that Biden was paying over a million mortgages.

In USA, median household income is around $80,000 and the median home price is around $400,000

Likely there is no way they can qualify for a mortgage unless it is less than 5% :-(

AD says

In USA, median household income is around $80,000 and the median home price is around $400,000

Likely there is no way they can qualify for a mortgage unless it is less than 5% :-(

Whole system is based on permanent inflation, because it makes people who run the system money. If health insurance went away, cost of healthcare would drop like a rock. If government stopped subsidizing borrowing, costs would drop. It's a shit system really, because it is ran for the benefit of the few. And it's in every damn industry, everything is like that. From food production, to cars to houses to healthcare.

Fortwaye says

AD says

In USA, median household income is around $80,000 and the median home price is around $400,000

Likely there is no way they can qualify for a mortgage unless it is less than 5% :-(

Whole system is based on permanent inflation, because it makes people who run the system money. If health insurance went away, cost of healthcare would drop like a rock. If government stopped subsidizing borrowing, costs would drop. It's a shit system really, because it is ran for the benefit of the few. And it's in every damn industry, everything is like that. From food production, to cars to houses to healthcare.

Yes, just on face value there are enough socieoeconomic statistics like from Yahoo Finance about top 10% owning 93% of the stock market.

And I would safely surmise at least 65% of the top 10 are Democrat supporters ranging from Soros family to executives with non government organizations and non profits.

I'd like to see profit sharing and employee owned companies, and more emphasis at local level such as with trade schools.

.

AD says

In USA, median household income is around $80,000 and the median home price is around $400,000

Likely there is no way they can qualify for a mortgage unless it is less than 5% :-(

AD says

In USA, median household income is around $80,000 and the median home price is around $400,000

I stick to the 3x's income method. Not gonna get you a luxurious house but $240k can get you a lot of decent homes in good areas. Might not be your dream home and there might be some sweat equity, but it's doable in most parts of the country. https://www.realtor.com/realestateandhomes-detail/210-Koch-Dr_Genoa_IL_60135_M86386-56867

This is NOT near me but I know where it is. There are massive suburbs to the East along I-90 so there's plenty of job opportunities. Nothing fancy house wise. 40 minutes drive roughly to O'hare. Bunch of union and high school grad type jobs that pay $50-60k/yr for one person. Wife gets a $30-40k/yr job and this house would be easy. You can get that with a high school education and that comes out to $80-100K/yr income.

Problem is people can complain about prices, maybe they're not using their income properly. I think that's the bigger culprit of housing. "Waaaaa I can't afford a house after I spent 20% of my income on cars or Chinese crap." Stop pointing and remember you have a thumb. Lift that arm and point it at yourself.

Americans have become cry baby bitches. A lot of boomers were soft or non-existent as parents. As a guy it's seriously so trivial to go make $100k. If you have kids you'll need a partner that can bring in $20-30k if you have kids. $130k/yr is a $390k home and you could stretch it to $425-50k if you wanted to be house poor in my opinion.

Point is you're either living in an area you shouldn't be or you don't know how to make money. It's one or the other.

WookieMan says

Point is you're either living in an area you shouldn't be or you don't know how to make money. It's one or the other.

People retired down from 1990 to 2020 to Florida panhandle from the north after selling their $700,000 bungalow crap shack like New Jersey and Connecticut and then buying a $450,000 home that is near the beach, 4 bedroom, 3 bath, with garage so their family can visit and stay with them.

It's surreal how housing prices got to where they did in New Jersey and New York (Long Island) compared to you part of Illinois (within 1 hr of Chicago).

But that cycle has ended. That is what I am hearing from the local establishment in Bay County Florida as far as them diversifying the economy and not only with tourism (only 5 hour drive within Atlanta).

,

AD says

It's surreal how housing prices got to where they did in New Jersey and New York (Long Island) compared to you part of Illinois (within 1 hr of Chicago).

We didn't build for about 15-20 years in most parts of the state, IL. That's why our prices aren't going down anytime soon HERE. Other areas will go down for sure if they built over the last decade.

Not PCB, but I know the whole Water Color area is booming. No pun intended, but that's destined to happen in that part of the Panhandle. St. George island is out of control to your east, but they stuck to single family on the island. You can get houses and lots in the Plantation, but even the most outdated house is probably $600k if lucky (admittedly haven't looked recently). No high rises so they by default restricted supply.

I've never looked at PCB for real estate. Also my searches would be strictly for vacation/retirement. I know Destin, Ft. Walton, Navarre and Pensacola near the beach are going well still.

Weird part with the Panhandle is that vacation rental rates pretty damn high. I've seen multiple properties triple in about 5 years. That's why we've only been back once in 5 years. I'd rather go to St. Thomas or St. John for a week for $1-2k more. It's nice to get away from chain restaurants and that bull shit. Even if not an official chain, they're all owned by 3-5 groups that make the same food. I like the sand better in the Panhandle though.

But if you calculate by gold price, it's now ~ $1,082,900.

MolotovCocktail says

But if you calculate by gold price, it's now ~ $1,082,900.

And on 1 income.

WookieMan says

they're all owned by 3-5 groups that make the same food

ditto. 4 of the 5 Seafood places here aren't chains but all run by the same Family. The same right down to the Sysco orange tangy dipping sauce.

Median household income was $5100 and minimum wage was $1 an hour in 1958. Median home price was around $12,000.

Today it is about $80,000 and I figure the starting hourly wage is around $14. Median house price is around $420,000.

Median price increased by about 5.5% annually.

Let's see...

2025 - 1958 = 67 years

1.055 ^ 67 = 36x

At 5.5% for 67 years, $5100 becomes $183,600, so salaries did not go up 5.5% per year. Salaries went up about 80000 / 5100 = 15x, which corresponds to 4.1% increase annually.

But $12,000 x 36 = $432,000, so yes, prices went up about 5.5%.

Patrick says

Let's see...

2025 - 1958 = 67 years

1.055 ^ 67 = 36x

At 5.5% for 67 years, $5100 becomes $183,600, so salaries did not go up 5.5% per year. Salaries went up about 80000 / 5100 = 15x, which corresponds to 4.1% increase annually.

But $12,000 x 36 = $432,000, so yes, prices went up about 5.5%.

I prefer the median income, not household.

It's a bad comparison between Ward Cleaver plus wife,kids, and pets on a single income to Ashley and Raylan the DINKs with two incomes, a dog, but no kids.

So over such a time, between the 50s and today, we should compare apples to apples... a ONE income family. Using today's median household income distorts that due to DINKs - No kids by the 30s was another rarity prior to the last few decades, but common now.

I'd say use $50k, not $80k. Or maybe split the difference to get closer to the decline in living standards.

AmericanKulak says

I prefer the median income, not household.

It's a bad comparison between Ward Cleaver plus wife,kids, and pets on a single income to Ashley and Raylan the DINKs with two incomes, a dog, but no kids.

So over such a time, between the 50s and today, we should compare apples to apples... a ONE income family. Using today's median household income distorts that due to DINKs - No kids by the 30s was another rarity prior to the last few decades, but common now.

I'd say use $50k, not $80k. Or maybe split the difference to get closer to the decline in living standards.

I spent a lot of time looking at this in 2007 to try to figure out what should be the expected price of gold after the US went off the gold standard. The US went off the gold standard in 1971, but there was some "float" in the later 1960's due to international politics (I think involving France). So my benchmark year was 1967, before that happened. 1967 also happened to be the CPI benchmark year before the government changed it to a later date coincidently when it began applying hedonics to its calculations.

I tried to benchmark gold against all sorts of stuff like median rent, house price, barrel of crude oil, commodities like corn and eggs. I used numbers from US Government web sites (census, bureau of labor statistics, federal reserve board). All those stuff seemed to be dominated by their own exogenous factors that swamped out the effect of money printing.

I settled on the hours a median wage earner would have to work to trade his/her labor for an ounce of gold. At first I benchmarked median household income. That was a good proxy for the early years but I realized that in the early 1970's the typical household lived on one paycheck but by the end of the 1980's the typical household had one than one wage earner. We all know the reason, - women going into the workplace. The extra paycheck masked the declining purchasing power of a workers' wages, - while it worked.

In the beginning the divergence between median household income and median wage earners' income was minimal, almost a rounding error. But it grew year by year till it plateaued in 1995. I supposed that was the year when all the women who were going to join the workforce had done so. I forgot the calculations that I used to put a number on this effect, but I remembered the result was 1.1% per year. So essentially, due to our declining standard of living, all else being equal a median worker would have to work 1.1% more years each year to trade their labor for an ounce of gold.

At the time (2007), my estimate was that the "median" worker ought to trade something like 32 hours of labor for an ounce of gold. That gold price calculated to something like $780. When gold was near that price in 2007, I quit buying.

I lost all the data when my employer replaced the PC's assigned to us, and I lost the mojo to make a new spread sheet. I suppose that since 2007 the gold price CAGR has averaged between 7% to 8%, - a piss poor investment compared to stocks. But a good return for a fiat money substitute. BTW my cool and hip Silicon Valley residence has appreciated at a CAGR of about 3% during the same years.

.

So housing started to deviate from the historical median around the start of Bill Clinton's second term. What legislation did he sign to contribute to this, or what policies and executive orders as well ?

But one thing for sure, housing has become an asset like stocks such as with AirBnB, etc.

Combine this with the banking industry promoting HELOCs and reverse mortgages.

.

MolotovCocktail says

But if you calculate by gold price, it's now ~ $1,082,900.