Originally Posted by
IronPirate
Also, something odd about current housing prices - we're seeing houses sell for much less than replacement cost. This concerns me. Even used cars always sell for more than the market value of their components...but not houses? Something seems artificial about these low prices. I agree we're in a correction, but something isn't right here...
I don't see any newer homes going for less than replacement, but I do see some older ones going like you say. Maybe homes are becoming more like cars and other things. As they get older, more worn out, they depreciate in value. I question replacement value too. I've seen same contractors building and selling houses for 400k and not so distant past building and selling similar homes for 150K yet seemingly still making a profit. The building trades are in shambles, low paid labor is king. I would think, relatively speaking, it is much less expensive to build a home now than it was in the 70s and 80s when you still had union plumbers, carpenters, electricians and viable apprenticeship programs. Couple that with lumber going for 1/3 of what it was going for at height of boom.
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