What surprised me the most was the fees that just piled on. I knew the land, labor and materials costs.

Just the sewer (the capacity only, no work done) was $11k. Then add on the park and school fees which both were over $10k. No wonder it a builder has to build something over 2000 SQFT to make it pencil out.

Tangibly related.

IMO the North America economic-societal "model" is High cost + More regulation. Everything is legal and proved by some experts, and regulated to the maximum, but in reality they also build moats after moats for existing interest groups (landlords, insurance companies, big contractors, etc.).

And everyone thinks this is the right model for "democracy" and "ruled by law". People may blame for part of the model (e.g. landlords) but never realize that the whole model is built to support this.

This is my observation so definitely biased.

It’s wild to hear people scape goat REIT funds and campaign for rent control when the real problem happens to be “average people” owning investment properties. Step 1 of fixing the problem is the immediate repeal of Prop 13.

I bought a prefab backyard office after the pandemic for about $30K. I love it, even after the final price came to about $80K.

We figured out that overhead power lines would prevent it from being lifted in by a crane, so we decided to have it assembled onsite. Then the county decided -- after full approvals -- it needed a concrete foundation. We asked how to do that when the backyard already had a concrete foundation. Building department said pour it on top of the existing foundation.

I've mentally blocked my memory of the other ways the county came up with to make it hard to place this cuboid shape in my yard, but each time added another $10K. And the end result, other than being a foot off the ground because of the duplicate foundation, was nothing more than the $30K structure I originally bought. I can't point to where the extra $50K went and say at least I got value from it.

Like all home construction or remodeling, each misstep was outrageous, but tolerable because it was surely the last hiccup before completion. Only later do you realize it's Zeno's Paradox and you're always halfway from the finish line.

Now you get to enjoy decades of perpetual harassment under a microscope by that same governing body!

Which model did you get, and how much did it end up costing per square foot (if you don't mind me asking)? Just curious how much the real costs end up comparing with the sticker pricess on their website.

Sounds like a sad story, but hard to know what went wrong. Did a safe design collide with regulations that weren't written with modular housing in mind? Did the modularity cause normal approval processes to happen out of order, allowing construction to mistakenly start before fire approval? Or was this simply the often Kafkaesque permitting process actually correctly identifying serious issues?

It's true that there are heavy regulations on what housing can be built where, but I don't think this is primarily driven by "investors" (in the sense of people who make their money by being commercial or residential landlords). I think it's primarily driven by homeowner-occupiers - people who own the homes that they themselves live in, who are not professional investors trying to maximize their rental profit, and who care a lot about the ways in which new construction or the ability of more people to live near them might negatively effect their quality of life in the place they live.

The free market consolidated into this on its own. Some actors became too powerful for it to remain "free".

Stick-frame single-family construction is pretty inexpensive. For a single-story structure, rough framing and roof can be done by a couple of low-wage laborers with simple tools in a week.

Prefabrication doesn't save all that much money: you still need several guys, now with a crane, and you need to ship and deliver an oversize load. A lot of the cost is finish (including cabinets, countertops, appliances), and in California, land and compliance.

It's sort of a blend. For many houses, the walls and roof trusses are delivered pre-built. Possibly even pre-wired, insulated, and drywalled. They are then stood up on site, and a moderate amount of connecting framing and finish work done by hand.

Labor and materials isn't the problem with housing costs. It's onerous permitting and zoning and code requirements.

The nice thing about a factory built house compared to an independent contractor is you don't have to wait weeks between job types, your plumbers are on hand as soon as it's ready for them to get started.

With that said, the advantage disappears compared to national builders- the guys who buy up big farm fields and build entire subdivisions all in one go before they even have buyers. They can keep crews rotated between jobs in a fairly predictable schedule, so the only thing holding anyone back compared to the factory is bad weather preventing digging out room for foundations.

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That's absolutely it. The most absurd case is of course San Francisco, where literally one single building allowed by recent state law overriding local zoning is adding 100 years worth of total housing units and 15 years worth of affordable housing construction at current rates to the Marina district (https://www.sfchronicle.com/realestate/article/sf-safeway-to...), but the same problem exists in a lesser form across the state.