The cost of housing from 1980 to 2000. >Mark Neglay wrote: >>>Thank God that in real terms, the cost of housing has dropped since >>>1965 and remained almost constant since 1980. (the source for this is from a post by Mike Coburn) Mike Coburn wrote: >In the original post I had quoted that in 2000 houses cost 2.6 times >what they did in 1980 (I think that's right -- I would have to go back and >find the post). Note: this is from http://www.ofheo.gov/house/hpi_body.html#IDX21 and the national average price increase of 162.2% from 1980-2001 That means the average house price increased by 2.622 times. An increase of 100% means that it doubled. Hi, Then you are confirming Mark's claim. At least according to BLS data. Note that using the CPI inflation correction at: http://www.westegg.com/inflation/ the inflation factor 1980 to 2000 is 2.286 times. So housing costs are up 2.6/2.286 = 1.13, or more than inflation by 13%. But family incomes are up more than that, even for the lowest quintile. From: http://www.census.gov/pub/hhes/income/histinc/f01.html note that the lowest quintile income have increased from $20,037 in 1980 to $24,000 in 2000. That is up by 24000/20037 = 1.2 or 20% and in inflation corrected dollars. Of course the upper 80% of families have done even better. So even the bottom quintile has had their housing cost increase less than their income: or (saying it the other way around) they spend LESS of their income on housing now than in 1980, if your initial figures were correct. royls@telus.net wrote: > > There are more workers per family now, as the working-age >population is a greater fraction of the whole, and adult female >workforce participation is much higher. Hi, Yes. But today there are fewer people per house and larger houses. I don't see your point. Sure the wife is now more likely to be working than in (say) 1950. Or in 1980. This makes it easier for the family to afford a house, but it does not increase their need for housing. jeb: >>From: >> >>http://www.census.gov/pub/hhes/income/histinc/f01.html >> >>note that the lowest quintile income have increased from $20,037 in 1980 >>to $24,000 in 2000. That is up by 24000/20037 = 1.2 or 20% and in >>inflation corrected dollars. Of course the upper 80% of families have done >>even better. >> >>So even the bottom quintile has had their housing cost increase less than >>their income: or (saying it the other way around) they spend LESS of their >>income on housing now than in 1980, if your initail figures were correct. ---(meaning Mike Coburn's initial figures)--jeb Roy: > >IOW, the more working people it is necessary to cram into one house in >order to make the payments, the lower you think the real cost of >housing is. Somehow, I kinda figured it'd be something like that. ??? When the wife works, this does not "cram more working people into the house". She was living there even when she was not working outside the home. If anything, the house is LESS crowded (on average) when both parents work outside the house. The facts are that houses are now larger and families are now smaller, than in the past. And even at the bottom income quintile, family incomes have increased faster than housing costs if Mike Coburn's data is accurate. > >There is a difference between citing facts and having respect for the >truth. > >-- Roy L Just what is the "truth" that you and Mike are complaining about? That more wives now work? And that this means less of the family income is now spent on housing? But that the houses they live in are bigger and better? AND: "tonyp" wrote: Jim Blair wrote > >> ... Sure the wife is now more likely to be working than in >> (say) 1950. ... > "tonyp" wrote: > >Gee, I hope your mother doesn't hear you talking like that, Jim :-) > >Fewer housewives may have been getting _paid_ in 1950, but it's not >obvious to me that they were _working_ less. > >-- Tony Prentakis Hi, Yes, of course. But this is a point that Roy does not want to recognize. In 1950 (or 1980) as compared to now: THEN, on average, the wife both lived in the house and worked. But NOW she is more likely to work outside the home and get paid for it. But she still lives in the house and works. Roy says that this "crams more working people into the house". But there are on average fewer PEOPLE in the house (since now they have fewer kids on average) and their house is LARGER on average. There are more "working people" in the house now only if you consider that before she got a paying job the wife didn't "work". (try to explain that to NOW, of even to your grandmother--or to my mother ;-) And I think using a term like "cram" to describe fewer people living in larger houses is deceptive. That sound to me like a case of trying to use numbers (more wives being paid for their work) to mask the truth that less of the family income (on average) is now being spent on housing that is providing more living space per person in a house with improved features. ,,,,,,, _______________ooo___(_O O_)___ooo_______________ (_) jim blair (jeblair@facstaff.wisc.edu) Madison Wisconsin USA. This message was brought to you using biodegradable binary bits, and 100% recycled bandwidth. For a good time call: http://www.geocities.com/capitolhill/4834 In alt.politics.economics Jim Blair wrote: >:>>Note that using the CPI inflation correction at: >:>> >:>>http://www.westegg.com/inflation/ >:>> >:>>the inflation factor 1980 to 2000 is 2.286 times. So housing costs are up >:>>2.6/2.286 = 1.13 or more than inflation by 13%. >:>> >:>>But family incomes are up more than that, even for the lowest quintile. > >: royls@telus.net wrote: >:> >:> There are more workers per family now, as the working-age >:>population is a greater fraction of the whole, and adult female >:>workforce participation is much higher. > >: Hi, > >: Yes. But today there are fewer people per house and larger houses. I don't >: see your point. Sure the wife is now more likely to be working than in >: (say) 1950. This makes it easier for the family to afford a house, but it >: does not increase their need for housing. TCP wrote: > >I think there are at least a few things going on here. (1) For the middle >class family, is is easier to afford a house, and their need for housing >has not increased. Hi, And I agree. The problem with using a single figure for "the cost of housing" is that it does not consider different price ranges and different parts of the country. It is just a gross average. I jumped on this because Mike Coburn introduced this number to show that housing costs have increased "faster than inflation". They have. But so have incomes. And this illustrates that even the bottom income quintile family incomes have increased faster than his "cost of housing". Thus Mike's own figure tends to discredit his claim. Now maybe if we had some figure for the cost of "low end housing" to compare to that bottom quintile family income, we might be able to say that the poor now spend more of their income on housing. But overall, we now spend less of our income, nation wide. > >(2) I believe that housing costs have increased the fastest at the LOW END >of the housing market, .... In a nearby medium-sized city, fully 5 >percent of houses have been flagged by the city as unfit for occupancy. >This loss of available housing surely is concentrated in the low end >of the market - imagine how much lower rents could be if all those >houses were occupied. Specifically, I believe that the bottom quintile >has had their housing cost increase more than their income. You could be right. It would take some data to tell. This can't be proven from pure logic on land area and population figures, > >(3) I believe the "cram more working people into the house" is largely >a lower-income thing. But we are comparing 1980 to 2000. I think that low income/low cost housing was more crowded then as well as now. Again, it would take actual data (census dept?) to say if crowding was greater now than then. But Roy's "craming" has nothing to do with "crowding". When the wife gets a paying job, more WORKERS are "crammed" into the house by his definition. And it is "shameful" to point out that the house has not become more crowded as a result. AND: >royls@telus.net wrote: > >>You are trying to shift attention away from the issue: that the exact >>same house commands a higher multiple of an average worker's after-tax >>income now than it did then. Jim Blair: > >Again, I say it all depends on how you look at it. A house now costs more >of a workers wages, but it costs less of a families income. So are houses >bought by "workers'" or by "families"? Roy: >Oh, families, definitely. Workers can't afford them any more. Hi, Those "workers" who can no longer afford to buy a house should be able to take some comfort in the fact that more "families" now own their home that ever before, and that their "family" can now buy a house using less of their income. So maybe those "workers" should move in with their "family" to live? ,,,,,,, _______________ooo___(_O O_)___ooo_______________ (_) jim blair (jeblair@facstaff.wisc.edu) Madison Wisconsin USA. This message was brought to you using biodegradable binary bits, and 100% recycled bandwidth. For a good time call: http://www.geocities.com/capitolhill/4834 AND THIS from tcw@2xtreme.net (Tim Worstall): >Mike Coburn: > 2. The amount of labor required to purchase a single family > dwelling (this includes condos BTW) has increased by 30%. This whole post has been going on so long that I've almost forgotten what first drew me into it. This point 2 is it ( plus the insistence that this labour be measured by minimum wage ). Well, I've come across some statisitics that seem to refute the basis of the argument. Not for the exact time period 1980- 2000 to be sure.....but then we can't have everything can we ? The argument can be pieced together over a few pages of 'The Skeptical Environmentalist'. On page 79 we have 'American homes have improved to an amazing extent, although the amount spent has remained a constant 15 % of income.' Also, from the graph we can see that the average number of rooms per person in the dwelling has moved from just under 2 to 2.2 in the period 1980 to 2000. So more housing for the same proportion of family income. We then have Mike's contention that the labour hours expended to buy that housing are the only true measure of its cost. So if the portion of income has remained constant, then we should see a rise in hours worked, in order to pay for the more expensive housing. On page 82 \ 83 we see figures for total working time for both men and women from 1965 to 1995 in 10 year gaps. We have already discussed in this thread the idea that while women have obviously gone out to work in the cash economy more than they did, this is not the same as stating that women's working hours have increased. The bulk of women's work in previous times was unpaid inside the household...as indeed was a significant portion of a mans. This does not affect Mike's proposal....the switch from unpaid to paid labour by women is not the same as an increase or decrease in the total amount of labour required to earn the household income. What are the actual figures ? 'Total work time over the past 30 years has decreased by four hours for women and five for men.' This from Robinson and Godbey, 1999. See below. Soooooo The housing is getting better, the portion of income needed to pay for it is static and the total hours worked are declining. So that sounds like less hours of labour to buy a house. Tim Worstall AND: Do people now have more leisure time? See: Robinson and Godbey 1999. at: http://www.psupress.org/books/titles/0-271-01970-0.html QUOTE: Is it possible that Americans have more free time than they did thirty years ago? While few may believe it, research based on careful records of how we actually spend our time shows that we average more than an hour more free time per day than in the 1960s. Time-use experts John P. Robinson and Geoffrey Godbey received national attention when their controversial findings were first published in 1997. Now the book is updated, with a new chapter that includes results of the 1995-1997 data from the Americans' Use of Time Project. --------------------------------------------------------------------------------- John P. Robinson is Professor of Sociology and Director of the Americans' Use of Time Project at the Survey Research Center at the University of Maryland. He is the senior author of several books dealing with the use of time and the quality of life, including The Rhythm of Everyday Life: How Soviet and American Citizens Use Time (Westview, 1988) and How Americans Use Time (Praeger, 1977). Geoffrey Godbey is Professor of Leisure Studies at Penn State University. His most recent book is Leisure in Your Life: An Exploration, 5th Edition (Venture Publishing, 1999). AND: Subject: Re: Third World poverty in California: living on less in the US Date: 4 Jan 2002 14:30:24 GMT From: Jim Blair Organization: UW-Madison Newsgroups: sci.econ, sci.environment References: 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 >Jim Blair wrote in message news:... >> jeb: >> >> >You made another claim that I question, but maybe I mis-read that one as >> >well. Do you think that Americans now live in houses on smaller lots >> >(less land area per person) than they did 30 or 50 years ago? >> >> royls: >> >> Given fixed land area and increasing population, that is trivially >> tue. >> >> >I thought >> >you said that, and I doubt that it is true. >> >> royls: >> >> You are just wrong. As usual. >> >> Hi, >> >> You are starting to sound like Mike Coburn: pure logic can answer >> empirical questions. Divide the population of a country by its >> surface area, and you get a number that has no bearing on the size >> of a typical home lot in that country. To answer the question in >> the first paragraph, data is needed on the actual size of housing >> lots. >> tcw@2xtreme.net (Tim Worstall) wrote: > >Yes, this troubled me too. Population density and housing lot size are >not related. There are simply too many other uses of land for a valid >relationship to hold. jeb: >> When I asked a friend in the sociology dept at the UW about the >> claim that people in the US are living on smaller lots, he not only >> had not known of this, but expects that the reverse is the reality. >> Since WW II the growth of suburbs and the decline of inner city >> populations indicates that Americans are living on larger plots of >> land. >> I asked about the current reverse trends: gentrification and the >> "new urbanism" movement like Middleton Hills near Madison. >> >> http://www.newurbanism.org/ >> >> He agreed that these do tend to reduce lot size. But these >> are both minor factors when compared to suburbanization. >> >> Then I found some figures on city growth and land areas. Between >> 1950 and 1990 Madison's population grew by 122% but the amound of >> urbanizied land grew by 299%. For Milwaukee, the land area to >> population ratio grew by 8 times. For the county as a whole, the >> increase was 3 to 1. The land area people occupy has been growing >> much faster than the population. (This was claimed to be from the >> US Census Bureau and was cited in Isthmus, November 23, 2001). >> >> This trend is considered to be BAD and is called "sprawl" by the >> environmentalists. >> >> Note that in 1950 Madison was 15 square miles in area. Today it is >> 69 square miles. The new houses in Dane county tend to be on much >> larger lots than the houses built during the 1950's 60's and 70's. >> How does that square with your claim? >> >> Most of the land area on the US is sparsely populated and has no >> bearing on the question of the average lot size of housing. tcw@2xtreme.net (Tim Worstall) wrote: > > >I hadn't realised that this thread was still rumbling on. >So, between you and me we seem to have empircally proved that Mason >and the other Georgists are wrong in one particular. >If I can remember back far enough it was that because minimum wages >have fallen behind house prices, then the average man is 30 % worse >off in the terms of trade between his labour and his housing. >We've then showed the following : >1) Average wages should be used, not minimum. Logical really, as if >you want to discuss the average man, then you should be using what the >average man earns. Average wages have been rising faster than minimum. >2) The proportion of income spent on housing has remained static. >3) The number of household hours taken by earning that income has >declined. >This includesw the effect of women moving from unpaid work inside the >home to paid work outside it, and the seeming inconsistency here is >largely taken up by technological advances. ( Mason did claim at one >point that there had been no major advances in home technology in the >period 1980 - 2000...take up of microwave ovens went from 10 % in 1980 >to 80 % in 1990 ) >4) Housing is getting ' better ' , an assumption made from the fact >that numbers of rooms per person is increasing. >5) You have now shown that the lot size upon which those houses are >built has also increased. > >Sounds to me like Mason's original these therefore fails. Another >beautiful theory destroyed by inconvenient facts. > >Tim Worstall Hi, An excellent summary of a long and rambling thread. But I add some corrections. It was not Mason (Clark?) but Mike Coburn who wanted to use the minimum wage with dollar values from federal law and/or state and local laws, but using his own definition of the meaning of the term, and who claimed that housing has been getting "more expensive". Your point #4 shows that houses have become LARGER. They have also become BETTER, but that is demonstrated by things like furnace efficiency increases, better windows, greater insulation (R factor), probably more electrical outlets and broadband connections, more have AC, etc. On point #3, I bet the sale of "semi-prepared" food and of take-out meals has also been a major factor in the decline of time spent in "housework" which includes cooking. I see supermarkets now sell packages of salads. People too busy to combine lettice and cut radishes and onions can just add dressing to the package, and eat. The increase in land area utilized per person is not clearly an improvement. It is at best a matter of opinion. The claim that it has been decreasing was made by Mike's sometimes ally Roy L. ,,,,,,, _______________ooo___(_O O_)___ooo_______________ (_) jim blair (jeblair@facstaff.wisc.edu) Madison Wisconsin USA. This message was brought to you using biodegradable binary bits, and 100% recycled bandwidth. For a good time call: http://www.geocities.com/capitolhill/4834