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by observation 3089 days ago
Wages really do buy less house than 100 years ago.

This would have been about 1920 when the Sears kit houses were invented.

Look at this: http://eastsidehill.com/news/wp-content/uploads/2010/04/1927...

The inflation calculator here:

32,424.83 in today's dollars for a respectable, quality 8 room house.

Sure it doesn't include land or labour but there's no way an 8 room house costs 32k today.

Today that would buy you a Tiny House on the low end of that market.

In my opinion, and I know we are far richer than our great-grandparents, but anybody arguing we're quantitatively richer than our parents has a long row to hoe. If this is progress it sure is lumpy. As Peter Thiel says the most likely explanation is we've had an nearly completely unacknowledged (by Western intelligentsia) stagnation technologically.

2 comments

> Tyler Cowen points out that there's not a single thing in your list of kitchen appliances that didn't exist in the 50s. People have highly temporally displaced notions, believing that things like washing machines or dishwashers are recent mass consumer items but they're not, they're nearly a century old.

Economists know that GDP measures are skewed by the fact that “a car is not a car” — that is, a new car today is much more than a new car from 30 years ago. It is safer and more comfortable, and consumers who pay the same amount in real dollars for a new car today are better off than consumers who bought a new car in years past.

So the “house” from the Sears catalog isn’t likely comparable to a house today with the same number of rooms. For example, the size of bedrooms, bathrooms, kitchens, closets, and garages has increased greatly in the last 100 years. New homes are more energy efficient and have safer wiring. Does this close the gap with a $32k house? Not in Silicon Valley, but there are parts of the country where the house (excluding the land, which Sears didn’t include either) is worth around $50k.

For example, the size of bedrooms, bathrooms, kitchens, closets, and garages has increased greatly in the last 100 years.

Have you been to the UK recently? :)

I don't know how much of an increase there was from about a century ago, but for the last few decades it's very much been going the other way. But the UK is something of a basket case when it comes to housing; people want to spend all their money on a mortgage.

Tangentially related, not long ago a minister suggested that people could keep a "jerry can" or petrol in their garage and was roundly mocked not only for the fire hazard, but for the casual belief that everyone has a garage.

Personally I've always felt the existence of the garage to be an underrated contribution to American innovation.

I don't mean Americans aren't aware of it, I mean that sort of thing never comes up when Europeans discuss how to increase innovation. They will produce 'e-centers' and 'hubs' but I think most of the good stuff just comes from some people screwing around, probably with some things that don't rate much fanfare or seem adequate for a proposal.

Sorry about the edit, I thought I was waffling on too long.

My position is not that you're wrong, it's that most of us are missing the subtext of our technological development which is that nearly all of it is computer related and we've papered over failures in a large number of technological areas by simply not talking about them (in society, not on HN).

> Economists know that GDP measures are skewed by the fact that “a car is not a car” — that is, a new car today is much more than a new car from 30 years ago. It is safer and more comfortable, and consumers who pay the same amount in real dollars for a new car today are better off than consumers who bought a new car in years past.

That is true. I wouldn't dispute the affect of accumulated incremental changes to existing product lines, it's meaningful.

It's true in two directions. For instance many items today are inferior goods to past goods. Here is an example.

New growth lumber is inferior to old growth lumber. Something made out of wood such as siding, framing or window/door frames will require more frequent replacement due to rot, insects, weather. The old growth equivalents lasts for decades and even centuries. Today we rely on a mixture of more frequent maintenance and often toxic additives (protective coatings) and if that doesn't work we are forced to leap to far more complex, sometimes expensive replacements e.g. UPVC, I-Joists, LVLs.

I'm not saying the technology is bad. It's great engineering ingenuity, I'm stating its requirement exists because of a failure in our ability to match or improve qualitative tree farming and botanical biotechnology.

> So the “house” from the Sears catalog isn’t likely comparable to a house today with the same number of rooms. For example, the size of bedrooms, bathrooms, kitchens, closets, and garages has increased greatly in the last 100 years. New homes are more energy efficient and have safer wiring. Does this close the gap with a $32k house? Not in Silicon Valley, but there are parts of the country where the house (excluding the land, which Sears didn’t include either) is worth around $50k.

This is a big subject, I'll just throw one dart at you.

There is a hidden assumption. Why are your houses more energy efficient? It's because a barrel of oil doesn't cost $1 anymore.

There's a dark side to energy efficiency.

The side affects of higher insulation requirements is that houses cost more, studies on passive houses suggest 10%-20% more in the positive scenarios. The real problem though is that the most common forms of insulation offgas toxins and since houses are meant to be more air tight... The fact is that most buyers of houses and most builders of them aren't up to speed on what is required to do this sort of housing without health risks.

Right now most houses in my country, without the latest insulation requirements, suffer from moisture, mildew and mold problems, all of which is not positive for human health - this only gets worse with the new regulations because consumers don't understand the importance of hvac or building houses as holistic systems.

Most of my complaints seem to go away if we actually had a real biotech revolution.

When DNA was discovered, when Human Genome was decoded, they said the exact same things they are now saying about CRISPR, that's what troubles me.

> * New growth lumber is inferior to old growth lumber *

I totally agree that many products are not "made to last" anymore. A fancy blender can do amazing things compared to an old one. But it will probably not last as long, and that's a problem.

The solution I have found is crowd sourced or expert recommendations from the following sources:

Kevin Kelly's Cool Tools book and website. Metafilter Reddit's Buy It For Life subreddit Finehomebuilding's Tool Guide

I find I buy less stuff, but of much higher quality or utility in this way. Some times I get something at a cheap price which works really well, like my Kiwi knives. Other times I have to be educated into realizing why something costs what it does and why or why not it's worth the money. Usually the answer is that the price is right because the object lasts much longer than the cheapo alternative or that the cheap version has a health drawback.

Recent Examples:

Merkur Safety Razor vs cartridge disposables ($$$) (factor of 100 decrease in cost!) Cast iron skillets vs Teflon pans ($$$) Tempered glass (container/bakeware) vs disposable trays/soon-to-be-cracked stoneware. ($$$) Induction cooking vs Gas (health) Expensive meat vs cheap meat. (health) Glycerin soap vs liquid soap/regular soap ($$$)

Here's a clear example. I buy a hard shave soap in a nice wooden bowl that costs $30. That's way more than a can of foam, but I've been using this for over four years now and it's only half used.

I don't do this with everything. I have a Silvercrest blender that has worked for a year, expected lifespan of three years I think, about $30 but buying a Vitamix or Blendtec at $500+ wouldn't 'pay me back' in a lifetime.

[waffle]

The China market isn't a problem if and only if it is understood by the consumer that they're getting disposables, so they should stock up and throw away more frequently. That requires money and space a lot of people do not have.

China production is immensely valuable for the bottom billions of the world who simply cannot plausibly afford West levels of wealth.

The rub is of course that you and I are getting lots of boxes with broken appliances/tools.

Modular houses can cost as low as $50/sqft. This Sears house looks like 900-1200 sqft, so 45k to 60k.

http://modularhomeowners.com/how-much-will-my-modular-home-c... https://blog.capterra.com/the-pros-cons-and-cost-of-modular-...

Yes, but can you build the Sears house for 35k today without materials substitutions. I don't think you can, prices of commodities were probably lower then, which is not in line with received wisdom.

The reason why I mentioned a Tiny House or THOW is that the comparison is much closer, I think like most countries in the past there were no planning permission or taxes on house building. A THOW too is built by the owner, but it is 200-300 sq ft and not 1200 sq ft.

The website you listed suggests a 50k modular house costs closer to 130k to install once everything is worked through. Do you believe the Sears house cost ~150-200% more in the end? Sure they had to dig wells too but I don't think that is plausible.

Archive.org has a mediocre scan of the bill of materials for one of them:

https://archive.org/details/SpecificationsAndBillOfMaterials...

It seems like there should be a collection of historical lumber prices somewhere. Just that comparison will be pretty informative about the relative material costs.