Last week we brought you “Million Dollar Shack [9],” a comedic yet sobering documentary that provides a first hand account of California’s housing bubble.
As we noted when we presented the clip, the short film embedded above has it all: absurd prices for rundown properties, soaring costs for rentals, even a tent in someone’s backyard that goes for $46 a night (you get an extension cord, one shower a day, and wi-fi).
Of course California isn’t the only place where the cost of living has gone through the roof.
Indeed, between America’s transformation from a nation of homeowners to a nation of renters, capital fleeing China for international real estate, and the proliferation of ZIRP and NIRP, housing costs have skyrocketed from New York, to Oslo, to Hong Kong. As we pointed out last Thursday [10], UBS is now out warning that London risks a “substantial price correction should the fundamentals for estate investment deteriorate.”
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All of this comes as DM central banks across the globe swear there’s no inflation and not only that, the same central banks cite a deflationary impulse on the way to cutting rates to zero or below which of course only serves to exacerbate the housing bubbles that are pricing the lower- and middle-classes out of the market.
The situation is so bad in London that one apartment seeker was recently shown the following “room” which she was told could be hers for "just" £500 a month.
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Well as it turns out, Silicon Valley and London aren’t the only places where tents and cots under the stairs are actually being marketed to renters. As Australian media reports [13], "tents outside" are now going for $90 a week. Here's more:
Renters in Melbourne are offering tents on a balcony instead of a normal bedroom — and people are desperate enough to move in.
Those who want cheap rent in the city can find adverts on sites like Gumtree, promoting the low-cost housing solution.
One tent is being rented out at Southbank for $90 a week.
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The seller, who already lives with two other people, had previously lived in the tent for six months.
It is described as comfortable and has electricity and a mattress.
The person who moves into the tent can share one of two toilets and can have access to the living room, kitchen and two new fridges.
Flatmates.com.au chief executive Thomas Clement gently suggests that before you resort to living in a tent on someone's porch, you consider living outside the city and dealing with the commute:
"More and more people want to live closer to the city centre and I believe that’s where some of the issues come in A lot of people are having affordability issues but the easy solution is move out of the city a little bit. I think people’s desire to live centrally is outweighing the logic of taking something affordable.”
Maybe. Or maybe prices are just too damn high. That is, maybe it's not the renters that are being illogical - maybe it's a market that's been distorted by a variety of factors including, but certainly not limited to, ZIRP. In any event, we took a quick spin around Gumtree.com [15] and found another amusig listing which, despite a valiant effort on "Debbie's" part to sell it in a way that isn't demeaning, is for all intents and purposes being pitched to vagrants:
hi,everyone i know how backpacker can be to cramped in shareing rooms with no private or to put a tent up at a caravan park , i have a caravan i have parked in my drive way that i am gonna let out for short stay people who are travelling through.
caravan has all utilities as reverse air con, microwave,toaster, kettel , small gas cooker, linen, it has 2 single beds or the table folds down to a double bed , where you have your own space,inside house you tv with foxtel if you like to use and socialised in side the house , share bathroom, kitchen if you like to cook up a storm, pergola out back with bbq that you can use if you like,internet at an extra cost.
your close to shops , beach, and transport, i have dogs that are friendly love people for attention.
PRICE
$25 a night
$30 a night for 2 people
$5 a day for internet per person in house
$155 if you stay7days for one person or for 2 is $190
there is a security bond but depends on how long you stay.
please text me or call no emails please Debbie.
Yes, "no e-mails", which shouldn't be a problem because if you're considering renting out Debbie's driveway "caravan," chances are you aren't toting around a MacBook (unless you're a jobless recent college graduate, in which case you probably left school with $35,000 in debt and five Apple products). Here's more from Thomas Celement (cited above):
“We don’t believe it’s a reasonable way for people to live."
“People think share accommodation is a student thing but it’s not. The majority of people who live in share housing are around 27 and in their first or second job.
“Living in a tent doesn’t connect with someone with a professional job.”
No argument there.
Of course at the end of the day, if living on someone's porch in a tent or in someone's driveway in a "caravan" isn't your style, you can always just go home...
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