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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

#451

Post by shazbotter »

scoofy wrote: post #227
gopher_space wrote: post #166

Earlier quoted context omitted.

Collusion using online management services to fix prices across a region. I think Washington State is working on legislation around rental services due to this already being a problem in the Seattle area. “Extra supply” is added to the portfolio containing housing they’ve already purchased. They own part of “existing supply” too.

Housing is a depreciating asset. Even if you're trying to continuously corner the market, you'll be losing money in the long run if you're not actually renting the units for more than you're buying them for. If supply can be built to meet demand, trying to corner the market to achieve monopoly rents will fail in the long run.

Land isn't. And the house is depreciating, but not the value of having a rental at that location. My house is worth four times what I bought it for a decade ago. The house itself is depreciating, and because I rent a portion of it, I can claim that depreciation, but the value of the property is going up.

Re: The anti-abundance critique on housing is wrong

#452

Post by JackYoustra »

moneycantbuy wrote: post #385

Gary's Economics claims wealth inequality is at the root of housing unaffordability. Basically as wealth concentration grows, the ultra-rich bid up the assets. See the price of gold doubling in the past few years. Government stimulus is also captured by the richest. It's also a global phenomenon, i.e., every major city is now unaffordable for most people. https://youtu.be/BTlUyS-T-_4?si=P0mdHxtq1F7DV4jo

You have the causality backward - housing explains ~100% of the variation of inequality. If you liberalized zoning, excess inequality would more or less disappear: https://www.brookings.edu/wp-content/uploads/2016/07/2015a_r...

Re: The anti-abundance critique on housing is wrong

#453

Post by JackYoustra »

abdullahkhalids wrote: post #294
Schiendelman wrote: post #223

Earlier quoted context omitted.

That's right, and that's caused by restrictions on supply. Almost every problem we have with housing comes down to us restricting how much can be built so much that extremely low quality units are competitive. If you allowed 10 times as much construction, those units wouldn't be able to compete, because other builders would offer better units for the same price.

Apparel markets are much more free and competitive than housing markets, and have basically no restrictions on supply. Yet, the quality of available clothing across the world have fallen. And we get incredibly cheap incredibly low-quality garbage. These things are much more complex than simplistic single-variable models.

This is substantially better than really bad apartments that are expensive or nice apartments that are very expensive!

It is not actually more complex, you don't spend ~40% of CPI on apparel.

Re: The anti-abundance critique on housing is wrong

#454

Post by epidemiology »

munchler wrote: post #376
jdkoeck wrote: post #367

Earlier quoted context omitted.

I wish they had more influence, then they’d be able to build more and prices would go down.

I'm all for building more housing, as long as it comes with the necessary infrastructure - schools, roads, parking, public transportation, etc. Where I live, developers seem to get government approval to build in locations where they can rake in a lot of money at high prices without having to worry about such things. (In fact, my local government is actually closing roads near new housing because "f#ck cars" is appar…

Let me guess. You already own a home?

Re: The anti-abundance critique on housing is wrong

#455

Post by JackYoustra »

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…

The causality is in the other direction, see (as I posted in another comment) https://www.brookings.edu/wp-content/uploads/2016/07/2015a_r...

Re: The anti-abundance critique on housing is wrong

#456

Post by reducesuffering »

davidw wrote: post #343
crooked-v wrote: post #148

Earlier quoted context omitted.

Here in extremely liberal Portland, there are a huge number of people who genuinely believe that 'greedy developers' are the cause of the nationwide housing shortage, having talked themselves into the nonsense belief that building fewer homes makes people more money.

I have been doing YIMBY stuff for around 8 years now, and it does not map nicely onto any kind of left-right narrative. There was one conservative dude who ran for city council here who was all about 'private property' and 'get rid of government regulations', who also ran against the idea of liberalizing zoning. I've met left wing people who I agree with on many issues who will do the most spectacular, Olympic level…

But you literally described the moderates being YIMBY and the more radical being NIMBY, which is left-right, but instead of left vs. right on pole ends opposing, it's the leftists and rights agreeing on NIMBY against the moderate centrists. Horseshoe theory strikes again. There is a growing populist frustration where citizens like both people like Tucker Carlson and Bernie but hate the moderate establishment. Low educated are frustrated with outcomes (ironically being NIMBY on housing is a primary cause) and go extreme compared to the educated moderates.

Re: The anti-abundance critique on housing is wrong

#457

Post by dlcarrier »

IFC_LLC wrote: post #221

Pretty much any criticism of a current housing market can't happen without mentioning the quality of said housing. I have just come back from one of the apartments I was looking at to see an abysmally small shoebox with some sort of doors and windows installed in there. I live in a house with 9-foot ceilings and I feel like a king. But this is insane. Recently I've visited a rental property to find shallow, not sound…

Rest assured, the quality has gone up, just not in ways that you, or most anyone, cares about. You'll be satisfied knowing that every house in the country is built with outlets every 12 feet, with independent circuits for the for every few hundred watts of lighting, able to withstand Arizona heat, California earthquakes, Florida hurricanes, Louisiana humidity, Minnesota cold, and everything else you may or more likely may not care about.

Inflated building code is a great way to repress the rate of new construction, and if it's all in the name of safety or energy conservation, no one can stop it, even if it's entirely useless for your house. That leaves low quality materials as the only ones affordable for a starter house.

Re: The anti-abundance critique on housing is wrong

#458

Post by Ekaros »

tsimionescu wrote: post #426
spicyusername wrote: post #228

Earlier quoted context omitted.

What about wealth inequality as the root cause of housing shortage? Keep building. Eventually there are more houses than people who want to be in them, regardless of whether or not they're being rented or owned. When that happens you'll see the prices fall. After all, if nobody wants to rent your house, you'll either rent it for lower or sell it. If nobody wants to buy it, you'll lower the price. Ad nauseum.

This only works if all those houses are on the market. Nothing is stopping today's rich people from buying up all new housing, and only letting a handful be on the market so as to not flood the market and not let prices go down.

They do not have enough capital to do that. Housing is such as large market that eventually anyone but the state would run out of capital. And it is not actually even that profitable... There is much better investments.

Re: The anti-abundance critique on housing is wrong

#459

Post by jdminhbg »

dang wrote: post #446
jdminhbg wrote: post #397

Earlier quoted context omitted.

[flagged]

Please don't post personal attacks to Hacker News. It's not what this site is for, and destroys what it is for. https://news.ycombinator.com/newsguidelines.html

Understood, but it's also the case that people frequently cite Stoller as if he's a legitimate analyst like a New York Times or Wall Street Journal reporter with skills and editors, and he doesn't actually understand any of the subjects he's trying to report on. I'll dial the snark back.

Re: The anti-abundance critique on housing is wrong

#460

Post by [deleted] »

TFYS wrote: post #435
999900000999 wrote: post #352

Excessive regulation is 90% of it. Here's how a rational market works. If I build an apartment complex, eventually those apartments will get older and more affordable. And even before that upper middle class folks will move in, freeing up their previous homes. But that's not how many in local governments see it. So you have affordable housing quotas on new developments. You have developers building units for the home…

> Here's how a rational market works. Might regulations be the result of these "rational markets"? After all, if I invest a lot of money to build apartments, I might want to protect that investment by lobbying for regulations to make it harder for competitors, increasing the value of my investment. Or if I buy an apartment, I might want to prevent others from ruining my view, prevent noise, etc. All completely ration…

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