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The anti-abundance critique on housing is wrong

derekthompson.org

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Re: The anti-abundance critique on housing is wrong

#101

Post by spankalee »

simpaticoder wrote: post #56

What about wealth inequality as the root cause of housing shortage? Even if supply is eased, the wealthy (those who have enough capital to earn passive income) will buy the extra supply and rent to the poor. The Piketty effect takes over, they invest their profit in more housing, wealth inequality continues to get worse, and while more housing exists, it owned by an increasingly small cohort. Personally I'd like to s…

Where's the evidence that wealth inequality is the root cause of housing shortage, as opposed to say, the real and factual lack of building?

Even if the wealthy did buy up extra supply to rent out, that would only mean increased supply of rentals, which would lower rents.

Re: The anti-abundance critique on housing is wrong

#102

Post by tptacek »

whoknowsidont wrote: post #97
tptacek wrote: post #51

Earlier quoted context omitted.

It's not on him to rebut every single argument Stoller has ever made. Several arguments Stoller made were refuted by the authorities Stoller himself cited, which is both interesting to read and also telling. Stoller is free to find similarly decisive refutations of arguments Thompson had made (they're unlikely to be forthcoming).

>Several arguments Stoller made were refuted by the authorities Stoller himself cited That's not true. At all. That's what Thompson _claims_. Look at what was actually written. It's incredibly sleazy writing. It's so one-sided it might as well be a celebrity gossip magazine piece.

I feel like not a lot of celebrity gossip consists of calls with economics professors who wrote cited papers discussing those citations, but we might just read different rags.

Re: The anti-abundance critique on housing is wrong

#103

Post by pixl97 »

baby_souffle wrote: post #80
nielsbot wrote: post #75

Earlier quoted context omitted.

Depends on how many tenants there are: is is a buyers' or sellers' market?

If - hypothetically - I had a ton of money and buying another house or two or fifteen wasn't a big deal, wouldn't there be a clear-ish signal that I should stop my demand for more housing lest too much supply screw with my income? I would also have an incentive to deploy some of my resources/capital to making sure that the supply of housing is juuuuuuust right for my extractive needs.

Thats what I'm trying to figure out myself, which bank is going to give out loans on a depreciating asset. Funding will dry up as supply increases.

Re: The anti-abundance critique on housing is wrong

#104

Post by lokar »

simpaticoder wrote: post #56

What about wealth inequality as the root cause of housing shortage? Even if supply is eased, the wealthy (those who have enough capital to earn passive income) will buy the extra supply and rent to the poor. The Piketty effect takes over, they invest their profit in more housing, wealth inequality continues to get worse, and while more housing exists, it owned by an increasingly small cohort. Personally I'd like to s…

Who owns housing is orthogonal to the rent or imputed rent for an owner occupied unit. The effective monthly rent is supply and demand.

Re: The anti-abundance critique on housing is wrong

#105

Post by simpaticoder »

tptacek wrote: post #65
simpaticoder wrote: post #56

What about wealth inequality as the root cause of housing shortage? Even if supply is eased, the wealthy (those who have enough capital to earn passive income) will buy the extra supply and rent to the poor. The Piketty effect takes over, they invest their profit in more housing, wealth inequality continues to get worse, and while more housing exists, it owned by an increasingly small cohort. Personally I'd like to s…

You haven't actually worked this example out. Try it. The wealthy buy the extra supply; they now compete with all the existing supply for tenants. What happens next?

>What happens next?

We'd revert to the state that applied for most of human history: 99% of humans will be serfs renting from 1% hereditary landlords. We'll have shown the American mid-century home-owning middle-class phenomena to be an historical anomoly. Average living standards will plummet and equity barons will never have lived so well. Any short-term rental rate drops will quickly be erased by a combination of growing population and well-known market manipulation, in particular further wealth consolidation.

Mere millionaires think they are safe; they are not. We live in a world that has a ~10 OOM wealth scale; being at level 7 does very little to protect you from 8s 9s and 10s, just as 2s are powerless to 4s and above. To a 10 a 7 may as well be a New Dehli beggar.

Re: The anti-abundance critique on housing is wrong

#106

Post by lokar »

ThinkBeat wrote: post #35

There is an incredibly large lobby group who is fully invested in house prices rising or at least not falling, namely homeowners. and since most politicians at a high level usually own one or more houses, they are fully invested in it as well.

I never see the NIMBY movement really engage with what falling prices would mean in practice. It just seems impossible to be allowed for any really duration over a large area.

I think a more realistic (but depressing) goal is modest loss to inflation (so prices go up by 1-2% less then inflation).

Re: The anti-abundance critique on housing is wrong

#107

Post by tptacek »

simpaticoder wrote: post #105
tptacek wrote: post #65

Earlier quoted context omitted.

You haven't actually worked this example out. Try it. The wealthy buy the extra supply; they now compete with all the existing supply for tenants. What happens next?

>What happens next? We'd revert to the state that applied for most of human history: 99% of humans will be serfs renting from 1% hereditary landlords. We'll have shown the American mid-century home-owning middle-class phenomena to be an historical anomoly. Average living standards will plummet and equity barons will never have lived so well. Any short-term rental rate drops will quickly be erased by a combination of…

I was thinking more along the lines of a simple math problem and less along the lines of an outline for a dystopian novel. Like, show the work.

Re: The anti-abundance critique on housing is wrong

#108

Post by bwanab »

donatj wrote: post #2

The bigger problem, at least in my neck of the woods, is they're not building affordable housing. By-and-large they are building luxury apartments and luxury homes. We've torn down half the city to build luxury apartments that sit at 20-30% occupancy. Building luxury housing won't help the housing crisis until the sellers are on the brink of bankruptcy and forced to sell their properties at a reasonable price.

Presumably, if they're sitting at 20-30% occupancy, somebody (like the developer) is going to be having trouble paying their bank loans. You understand what happens next? (hint: prices plummet). If that isn't happening then your diagnosis of the problem is very likely wrong.

Re: The anti-abundance critique on housing is wrong

#109

Post by immibis »

spankalee wrote: post #101
simpaticoder wrote: post #56

What about wealth inequality as the root cause of housing shortage? Even if supply is eased, the wealthy (those who have enough capital to earn passive income) will buy the extra supply and rent to the poor. The Piketty effect takes over, they invest their profit in more housing, wealth inequality continues to get worse, and while more housing exists, it owned by an increasingly small cohort. Personally I'd like to s…

Where's the evidence that wealth inequality is the root cause of housing shortage, as opposed to say, the real and factual lack of building? Even if the wealthy did buy up extra supply to rent out, that would only mean increased supply of rentals, which would lower rents.

It can be both. Wealthy people make it illegal to subdivide large housing units.

Re: The anti-abundance critique on housing is wrong

#110

Post by pixl97 »

denimnerd42 wrote: post #84

i hope the next part of his article covers the zoning issues. because I'm certainly not seeing the zoning issues making the homes be on bigger lots or requiring things like 3 car garages? If anything the lots in new tract developments in dallas fort worth are smaller and have less land using features like they don't have alleys. and then in Dallas city limits any small slice of land that can possibly be used for new…

I feel lucky in the sense that I have both the physical ability and the skill to do almost all of my own maintenance myself. With what I saved on landscaping alone I was able to buy all the tools I needed for almost any project.
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