Quote:
Originally Posted by Ned.B
VivaLFuego has succeeded in finding the exceptions to the rule. But all three examples are in areas with very poor housing values and desirability overall. In the case of Robbins, the new construction examples are the only houses that have sold for over $150,000 in the last few years and we don't know anything of the profit margins achieved building there. I have toured the Wellington development ion Lynwood and I can comfortably say that those houses are literally built of ticky-tacky, and the one's that were built 10 years ago already look rough. I think it still stands that in most places, a new house of this size cannot be had in the 300,000 range.
I think it is worth noting though, making this an even more apples to oranges comparison that the cost of a new home purchase typically includes the lot while the cost of construction we are seeing for multi-family likely does not. And so that makes the comparison of cost even more disparate. But overall, I don't think the cost of these multi-family buildings has been overinflated. It's just the cost of building something quality versus a vinyl clad and vinyl windowed stick framed box. And it's part of the reason that quality affordable housing will never organically occur in new construction and will always need to be subsidized to some degree.
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Well yes, that's the subtext. If you strip away mountains of code and quality requirements that have become de rigueur and find cheap land, affordable new construction is still possible even without getting into the manufactured/trailer housing realm. The high costs of new housing are otherwise self-imposed*, particularly in a stagnant region with lots of low dirt values.
Speaking of those low dirt values (notable in Robbins which has otherwise good downtown commuter rail access and decent expressway access)...There are also tangential questions about the viability and unintended consequences of a "densification" strategy upon places like Robbins, a town of some historic African American significance whose property values are too low to incentivize maintenance of the building stock.
*The Chicago MSA also has arguably the highest wages for construction trades in the country, particularly if adjusting for regional median wages across all jobs or adjusting for cost of living. Only SF and Honolulu have higher construction wages, and even then only barely.
https://www.bls.gov/oes/current/oes470000.htm
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