Monday, May 23, 2022

economics of the moment.

The world is a little hinky. There's a nationwide housing...thing, which I was somewhat skeptical about, until I saw that houses in my ancestral village, a New York Rust Belt hamlet which is convenient to absolutely nothing, has seen house prices double in the past couple years. Our house, where we've been for 9 years, is definitely much nicer than when we moved in; is it 170% nicer? Well, to live in, yes, but from a tax appraisal perspective, we haven't changed anything.

(The rat-infested garage is gone and replaced with a gorgeous new concrete pad; the house is surrounded by an alligator-filled moat lovely fencing. All but two windows replaced. Foundation brought up to date. The shed is ≤ 120 square feet and technically movable, and the shop is a trailer, so the official square footage/bedrooms/bathrooms are the same.)

I have struggled to understand the economics of being a landlord. Using a typical example, not even in the Bay Area, you'll see a place, say "Four units, never vacant, $3800/month turnkey," and it's selling for (say) $2,000,000. That's $86,400 of income per year! And...even with maintenance or rent increases, it takes numerous decades to pay off its purchase price. So if the revenue from the asset isn't the point, it must be the value of the asset, either to sell later on, or to borrow against for other financial plans (like buy more properties!). We did see people running a string of leveraged properties as Airbnbs, suddenly having a sort of cascading margin call when local governments decided the law applied to them the way it does with hotels; we saw it again with the pandemic crash, which indicates that, yes, one buys real estate in order to buy more real estate. It looks like a lot of work, although it is nowhere near as much work as having a real job, so there is that to consider.

I'm on a Slack instance with some folks from Rochester, NY, who linked a "10 Cities Where Home Prices Have Started Falling" listicle, and Rochester was #2, but #5 is my sadly post-industrial hometown. Or it was sad, anyway; but it looks like it's far above state and federal rates for violent crime, and only slightly above for property crimes.

(Not much change, I guess: we weren't in a bad neighborhood, but I did wake up one night to hear someone trying to jimmy open the back door under my bedroom. That door, probably solid wood aged from 1914, also had a pretty epic Yale deadbolt, keyed on both sides, so they only got the trim off. The door got deadbolt guards, and eventually we got an alarm system.)

Back when I spent three weeks at San Francisco Zen Center, there was a guy there who was fast approaching his priest/monk ordination—the ambiguity is a long story, but comes from Japanese Zen's histories in both Japan and the West—and he struck me because he was so young to be a professional cleric: somewhere around 22. He'd been at SFZC for a few years, and I don't know if he did college or not, and he didn't chat much with us transient students, but what struck me most was that he'd never lived on his own, only in groups of one kind or another.

I know quite a lot about solitude, and loneliness, and isolation, and so I know that the solitude of meditation (zazen specifically here) is one form of being with your self and your mind; and living by yourself, instead of in community, is quite another. And doing zazen when living by yourself is yet another other thing.

Hopefully I was not condescending at him, but in my head, certainly, thinking about my long road to living alone but mentally healthy, I thought he would at some point find he would need to figure that experience out.

Post-ordination, he left to be the resident priest in a place that needed them—one problem the Bay Area has with Zen clerics is that nobody really wants to leave—and blogged a bit, until he stopped. A few years later, I looked him up, and he's definitely practicing the Buddhist Right Livelihood...as a public defender in my hometown.