by William Skink
The article about housing going up,up,up in Missoula has a new wrinkle with the pandemic, and that’s a focus on whether or not more out-of-state buyers are flooding the market.
Wade through all the speculation and at the end of the day it doesn’t matter because the result is this:
…a new report from the Bureau of Business and Economic Research at the University of Montana shows that Missoula housing prices continue to soar.
The median sale price of a Missoula home in 2019 was around $315,000. According to economist Brandon Bridge, the first few months of data for 2020 shows the median sale price rising to over $340,000.
While our local housing market shows no sign of softening, the reality here and elsewhere could be changing soon with moratoriums on evictions about to end.
At Mintpress, Raul Diego has a concerning article, titled Tech Giants Eye Lucrative Rent Market as End to Eviction Moratorium Could Leave Millions Homeless. From the link:
Just as news of a mysterious virus was breaking late last year, Facebook invested $1 billion for the construction of 20,000 new affordable housing units in California, following Google’s lead which had made the exact same commitment a few months earlier. Apple more than doubled Google’s and Facebook’s investment, combined, when it put down $2.5 billion for the same cause.
On the occasion of Facebook’s investment, California governor Gavin Newsom declared that the “State government cannot solve housing affordability alone” and praised the public-private partnership for advancing the fight against “economic inequality and restoring social mobility.”
It is of course utter crap that Big Tech is investing in affordable housing to fight against economic inequality. If you can handle the investor-speak, this February article from Globe St. will help you understand why Big Tech is investing in affordable housing. From the link:
Investors may be overlooking the profitability of the affordable housing segment of multifamily assets. Affordable housing has recently become a popular investment class, but there is still a misunderstanding about the stability of the sector. Affordable housing has an attractive risk-return profile and is better positioned to perform through a recession than class-A apartments.
My translation: hey investor class, with all that interest-free stock-crack sloshing around in your portfolio, you should consider taking a bullish slumlord position, since our latest transfer of wealth is hollowing out those middle class pretenders.
First, there is typically strong demand for affordable housing, but new apartment development this cycle and low wage growth has driven affordable housing demand up. “It is a paradox,” says Needell. “The cost of new construction goes up, so the more that you build new, the less affordable housing is available because you have either torn down or gentrified affordable units. On top of that, millennials, which is a great demand set, have an inability to pay for the highest quality apartments, and when you combine that with demographic demand, you end up with a need for affordable housing greater than it has been in the past.”
My translation: by destroying existing affordable housing to build new apartment housing, and by destroying the upward mobility of an entire generation, we have engineered a demand you can now make good money exploiting.
The Big Tech making moves into Missoula is Cognizant, so I poked around their website and, oh boy, is it creepy. They are already anticipating the future of work with something called “Remotopia”. I didn’t watch their video because their description was all I needed to get that queasy feeling:
If there ever was a societal wake-up call, COVID-19 was it. The pandemic forced us to rewire work, correct hygienic sins, and double-down on our understanding of the cause and spread of infectious disease—simultaneously.
Months later, many questions abound: Will all who can work remotely do so for the near and long term? Will we be able to ever travel safely again? What environmental changes are needed to guarantee the safety of our physical workplaces and preserve the sanctity of our food supply? Can AI help identify, prevent, treat and cure infectious disease before it undermines us? What have we learned to sustain our way of life as we know it?
The Cognizant Center for the Future of Work, along with Cognizant healthcare and life sciences subject matter experts, have charted a path forward. Journey with us to see what is to come.
The Big Takeaway I’m getting from this cursory look at Big Tech’s near-term plans is this: they are very busy shaping what the future is going to look like, even housing…so what are we going to do about it?