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Change my mind: Density increases local but decreases global prices

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Re: Change my mind: Density increases local but decreases global prices

#21

Post by stale2002 »

endisneigh wrote: post #12
stale2002 wrote: post #9

Earlier quoted context omitted.

> 1. Major housing developments are accompanied by more jobs than the units being built could serve. Lets take your theory to be true. Even if this is the case, it would still effectively cause housing prices to decrease, relative to the amount of money that people are making. So, if density causes people's income to double, by having all these awesome and cool jobs, but housing prices only go up by 50%, this is stil…

> Even if this is the case, it would still effectively cause housing prices to decrease, relative to the amount of money that people are making. This isn't true at all, though, empirically. Trivially you can look at the minimum wage in the top 10 most expensive cities vs the bottom 10 and see this. > So, if density causes people's income to double, by having all these awesome and cool jobs, but housing prices only go…

You can't have it both ways here. Either density is creating lots of high paying jobs in an area, that is driving up the price of housing, or it isn't.

> Ironically denser places result in lower wages

No it doesn't. The highest paid locations, in the US, are located in these high cost of living areas.

> This is why people like remote work, so they can better arbitrage.

Yes, they work remote, because dense locations have high salaries. That supports my point. You just agreed with me.

If people had high paying jobs, where they live, they wouldn't work remote, to get the highly paid jobs in dense cities.

Re: Change my mind: Density increases local but decreases global prices

#22

Post by mattcantstop »

I think this write up about the price of housing is a worthwhile read. An underrated aspect of this is that people want to live in dense places, and are willing to pay more to do so. Not universally, but it certainly occurs.

https://devonzuegel.com/post/agglomeration-effects-might-cha...

Re: Change my mind: Density increases local but decreases global prices

#23

Post by endisneigh »

stale2002 wrote: post #21
endisneigh wrote: post #12

Earlier quoted context omitted.

> Even if this is the case, it would still effectively cause housing prices to decrease, relative to the amount of money that people are making. This isn't true at all, though, empirically. Trivially you can look at the minimum wage in the top 10 most expensive cities vs the bottom 10 and see this. > So, if density causes people's income to double, by having all these awesome and cool jobs, but housing prices only go…

You can't have it both ways here. Either density is creating lots of high paying jobs in an area, that is driving up the price of housing, or it isn't. > Ironically denser places result in lower wages No it doesn't. The highest paid locations, in the US, are located in these high cost of living areas. > This is why people like remote work, so they can better arbitrage. Yes, they work remote, because dense locations h…

> It should be almost self evidently true that they pay more money, than random jobs, in the middle of nowhere, in the US.

I'm talking about the wage relative to the price sq/ft. You're laughably wrong. Just google Median NYC salary and look at the median NYC sq/ft, and do the same with say, Dallas, TX. It's not even close.

I'm not talking about nominal wages, I'm talking about sq/ft monthly rent adjusted wages. When you look at that, the densest places do not have the highest wages. People are sacrificing earning potential to be in a more fun area, which makes sense.

Re: Change my mind: Density increases local but decreases global prices

#24

Post by stale2002 »

endisneigh wrote: post #23
stale2002 wrote: post #21

Earlier quoted context omitted.

You can't have it both ways here. Either density is creating lots of high paying jobs in an area, that is driving up the price of housing, or it isn't. > Ironically denser places result in lower wages No it doesn't. The highest paid locations, in the US, are located in these high cost of living areas. > This is why people like remote work, so they can better arbitrage. Yes, they work remote, because dense locations h…

> It should be almost self evidently true that they pay more money, than random jobs, in the middle of nowhere, in the US. I'm talking about the wage relative to the price sq/ft. You're laughably wrong. Just google Median NYC salary and look at the median NYC sq/ft, and do the same with say, Dallas, TX. It's not even close. I'm not talking about nominal wages, I'm talking about sq/ft monthly rent adjusted wages. When…

Once again, if your statement was true, people wouldn't be moving to NYC, or SF, for the highly paid jobs.

If they could get highly paid jobs, elsewhere, they wouldn't pay the high cost of living, to be near the high paying jobs.

I am not sure what theory you could invent, that would cause people to move to a high cost of living area, if not for the high paying opportunities in those areas.

If, instead they could get better opportunities elsewhere, why pay the high cost of living?

> People are sacrificing earning potential to be in a more fun area

Hey, if you know of any jobs that pay 500k a year, for a sofware eng position, not in SF or NYC, please let me know then!

I'm going to say, that actually its the salaries though.

Re: Change my mind: Density increases local but decreases global prices

#25

Post by endisneigh »

stale2002 wrote: post #24
endisneigh wrote: post #23

Earlier quoted context omitted.

> It should be almost self evidently true that they pay more money, than random jobs, in the middle of nowhere, in the US. I'm talking about the wage relative to the price sq/ft. You're laughably wrong. Just google Median NYC salary and look at the median NYC sq/ft, and do the same with say, Dallas, TX. It's not even close. I'm not talking about nominal wages, I'm talking about sq/ft monthly rent adjusted wages. When…

Once again, if your statement was true, people wouldn't be moving to NYC, or SF, for the highly paid jobs. If they could get highly paid jobs, elsewhere, they wouldn't pay the high cost of living, to be near the high paying jobs. I am not sure what theory you could invent, that would cause people to move to a high cost of living area, if not for the high paying opportunities in those areas. If, instead they could get…

> Once again, if your statement was true, people wouldn't be moving to NYC, or SF, for the highly paid jobs.

adjusted wages for rent is not the only consideration. cities have far more amenities, which are beyond the scope of the discussion.

it's simply a fact, however, that if you're simply looking at square footage, rent, and wage, the densest cities in the united states do not give you the highest wages. there's really no point in arguing about it, you can go look for yourself.

Re: Change my mind: Density increases local but decreases global prices

#26

Post by cammikebrown »

Building market rate housing will lower prices in the long term (decades) as older housing stock becomes out of date and affordable, but in the short term it only helps the most wealthy. The market rate in most places is very expensive. I don’t think we have enough housing, but we need affordable housing, and at this rate I think the only solution is state intervention.

Re: Change my mind: Density increases local but decreases global prices

#27

Post by atdrummond »

endisneigh wrote: post #20
atdrummond wrote: post #19

Earlier quoted context omitted.

The median resident isn’t buying a place in Shinjuku - see my edited part of the comment. Tokyo’s transit enables cheaper living than is available in the bay.

The bay isn't remotely reasonable comparison. NYC is much cheaper than Tokyo, adjusted for living quarter size and median wage. I'm not talking about affordances you get by living in certain areas - simply the size of the place and the price, relative to localized income. Tokyo simply is not cheaper, period. It only seems cheaper because rich Americans keep using their income and comparing it to the adjusted USD:YEN…

I was paid a local salary while living in Japan. The total cost of living in Tokyo blows NYC and the Bay out of the water in terms of affordability and I’ve lived multiple years in all three. CPI with rent in NYC is nearly 90% higher.

Median household in New York is 120k; it’s 87k in Japan. Rent is over 200% higher than in Japan. Even adjusting for square footage and the earning differential, I assure you it is much easier to get an affordable place (and pay less per square foot accounting for income differentials) in Japan than in New York. Because of the Japanese transit system and the lack of household appreciation, there is a much broader range of rental prices and that range increases the further outside the city center you go.

Re: Change my mind: Density increases local but decreases global prices

#28

Post by s1artibartfast »

endisneigh wrote: post #11
konschubert wrote: post #6

Earlier quoted context omitted.

Even if it didn’t slow the price increases - just the fact that building more housing means that more people get to live where they want to live- isn’t that a good thing and enough reason to build? And as you said, the neighbourhood gets improved - isn’t that a good thing? Or are you saying that the solution to the housing crisis is to make cities as inhospitable as possible such that people are forced to live in the…

I am not against building more. I am simply saying that if you look at the data, there is no evidence what so ever that building more decreases the price of housing. What it does is slow the price increases, but the very demand that is driving price increases was generated by the density, that is exacerbated by building more. We need a better metric. If you have some number to describe the quality of a city, perhaps…

Density doesn't drive price. Nobody pays more for "density".

Density and price are both simply measures that track other desirable factors like jobs. It is correlation, not causation.

Re: Change my mind: Density increases local but decreases global prices

#29

Post by nullc »

Why is it that many of the same people who argue against more roads and more parking lots on the basis of induced demand preventing more roads from meaningfully solving congestion seem to think that in the densest and most competitive cities that adding units will necessarily make hosing affordable?

Re: Change my mind: Density increases local but decreases global prices

#30

Post by endisneigh »

atdrummond wrote: post #27
endisneigh wrote: post #20

Earlier quoted context omitted.

The bay isn't remotely reasonable comparison. NYC is much cheaper than Tokyo, adjusted for living quarter size and median wage. I'm not talking about affordances you get by living in certain areas - simply the size of the place and the price, relative to localized income. Tokyo simply is not cheaper, period. It only seems cheaper because rich Americans keep using their income and comparing it to the adjusted USD:YEN…

I was paid a local salary while living in Japan. The total cost of living in Tokyo blows NYC and the Bay out of the water in terms of affordability and I’ve lived multiple years in all three. CPI with rent in NYC is nearly 90% higher. Median household in New York is 120k; it’s 87k in Japan. Rent is over 200% higher than in Japan. Even adjusting for square footage and the earning differential, I assure you it is much…

I'm not talking about total cost of living, I'm talking about the rent. meals along with other things, in tokyo are substantially cheaper than in New York, agreed.
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