Austin’s surge of new housing construction drove down rents • Hacker News Board

Re: Austin’s surge of new housing construction drove down rents

#91

Post by natpalmer1776 » Thu, Mar 19, 2026, 1:09 AM UTC

maxerickson wrote: post #40

cheriot wrote: post #20

Earlier quoted context omitted.

> and each one will hit house owning voters hard making it hard to replicate In a negative way?

As a homeowner, I want number to go up. These things push against that. Really, I'd prefer not having policies that tend to push up housing prices or discourage people from moving, but here we are, those types of policies are common.

As a former homeowner in Texas, I wanted the number to go down for lower property taxes. Taxes accounted for almost 1/3 of my monthly mortgage payments by the time I sold, and are a significant barrier to affordability of homes when values tend to vastly outstrip the rate of inflation leaving typical households struggling even with the homestead tax exemption.

The only people in the low income neighborhood I grew up in that could afford to weather this wave of out-of-state and investment banking homebuyers were those who were of retirement age and had their property taxes “frozen” at an affordable level.

Re: Austin’s surge of new housing construction drove down rents

#92

Post by mr_00ff00 » Thu, Mar 19, 2026, 1:09 AM UTC

JumpCrisscross wrote: post #64

tkel wrote: post #58

Earlier quoted context omitted.

They also teach you about elasticity in econ 101. It's foolish and anti-intellectual to insist that the housing market has only two factors, while simultaneously condescending about your understanding of economics shows that you really don't understand economics, it's more about your ego.

> It's foolish and anti-intellectual to insist that the housing market has only two factors Elasticitiy moderates the effect. It doesn't reverse it. Increasing housing supply decreases housing costs. A lot of people are venally or ideologically motivated against accepting this. Our housing crisis is a political choice. (Note: I'm a homeowner.)

This reminds of a fun fact I remember learning in university.

Elasticity is the relationship between demand and supply, and there are actually very rare instances where it can be negative (where demand increases with price).

These are called Giffen goods.

https://en.wikipedia.org/wiki/Giffen_good

Explanation (that I remember)

Inelastic demand is when a good is demanded so much, that an increase in price has little affect on the total quantity (people still demand it, think like addictive substances)

So a perfectly inelastic product would be a straight line where any amount is demanded at any price.

So having the curve keep going it would get a positive slope, where higher price makes demand go up.

If I remember the example I was given was food during a famine. Supply is already low, but an additional pressure on price is the known shortage. The idea being that as the price goes up people see it as harder to get.

It’s been so long since I studied the subject so I might have gotten some things wrong here.

Re: Austin’s surge of new housing construction drove down rents

#93

Post by lanfeust6 » Thu, Mar 19, 2026, 1:09 AM UTC

TulliusCicero wrote: post #39

xwowsersx wrote: post #5

You mean to tell me that increasing supply lowers price? Fascinating.

Unfortunately, there's a lot of people -- especially further left -- who fight this kind of reasoning. They insist that the housing market is different , and that just building more private housing won't help. No amount of evidence will convince these people, because they already made up their mind ahead of time: their ideology says the market can't help, so the market can't help, period. Any evidence to the contrary…

The populists on the right share a similar view, but mostly blame immigration.

Re: Austin’s surge of new housing construction drove down rents

#94

Post by bombcar » Thu, Mar 19, 2026, 1:09 AM UTC

jakelazaroff wrote: post #44

Gigachad wrote: post #15

Earlier quoted context omitted.

I guess the confounding factor is that the population isn't fixed. Greater construction could result in population growth which cancels out the gains from greater supply. You'd have to build faster than population growth to lower prices. And generally developers aren't looking to do that.

Sure they are. What developer wouldn't rather rent out ten apartments for $2k/mo than two apartments for $4k/mo?

Developers usually want to buy land, build house/apartment, and sell house/apartment.

They want to flow as much as possible - so if there are unlimited building spots you get a smattering of various options being built as they all find there niche.

If the building lots are rare, then they all will be built into the most expensive possibility.

Re: Austin’s surge of new housing construction drove down rents

#95

Post by mgfist » Thu, Mar 19, 2026, 1:10 AM UTC

ghostly_s wrote: post #86

riknos314 wrote: post #4

So glad we don't need to re-write the first chapter of almost every economics 101 textbook!

the snark is quite rich when reading beyond the headline makes clear this was anything but a free market solution.

OP wasn't talking about free markets but supply and demand.

Re: Austin’s surge of new housing construction drove down rents

#96

Post by mountainriver » Thu, Mar 19, 2026, 1:10 AM UTC

nemomarx wrote: post #3

Good news - experimental verification of the law of supply and demand! I'm sure the analysis is welcome though and I hope policy makers try to learn from this. We could densify most american cities quite a lot more.

We could but it’s not always just “good” to make things dense.

My hometown has had a huge push to add more housing to make things more affordable. What happened? Rents went down for a couple years then right back up. Except now the city has a bunch of more soulless condos and is horribly congested.

Sometimes preserving things and keeping them nice and simple even if it’s costs a bit of a premium is better.

Re: Austin’s surge of new housing construction drove down rents

#97

Post by hnthrow0287345 » Thu, Mar 19, 2026, 1:10 AM UTC

TulliusCicero wrote: post #39

xwowsersx wrote: post #5

You mean to tell me that increasing supply lowers price? Fascinating.

Unfortunately, there's a lot of people -- especially further left -- who fight this kind of reasoning. They insist that the housing market is different , and that just building more private housing won't help. No amount of evidence will convince these people, because they already made up their mind ahead of time: their ideology says the market can't help, so the market can't help, period. Any evidence to the contrary…

Their core argument is that we could increase supply but choose not to, and that we should be maximizing supply (as an ethical and moral mandate, but that is not a tenant of capitalism really) because housing is an essential thing like food and water. FWIW we don't maximize food/water production either for various reasons, which would also drive food/water prices down.

Maximizing supply can mean other things than building like taxing unoccupied homes by large amounts making them unpalatable to own as a second (or higher) home, thus putting them back on the market. However these aren't all good because obviously our economy deals with more effects than just simple supply and demand, like maximizing the amount of loans given to people wanting housing regardless of the ability to repay is known to be a bad idea.

If you throttle the supply you can clearly control the price and the people you're talking about believe there is a concerted effort to control that supply. This can happen directly (choosing not to build as soon as land is available to build on) or indirectly (e.g. politics, mass media influencing people to vote to not increase supply).

What people generally hate is production of essentials not being maximized which would give us the actual lowest price, and maybe we as a society should be maximizing that supply to arrive at the lowest cost for a given house with given features.

And then the rebuttal to that is usually "tough shit lol" which is why people coming out with simple supply and demand replies are generally seen as derisive.

Re: Austin’s surge of new housing construction drove down rents

#98

Post by bombcar » Thu, Mar 19, 2026, 1:10 AM UTC

CBLT wrote: post #18

lumirth wrote: post #12

I mean… duh? Genuinely baffled at people struggling to understand this. When there’s more of a thing, it costs less. Which is good when that thing is essential, like housing. Not sure the idea of housing being an asset which endlessly accrues value is good for anybody involved, long-term. Open to disagreement, though! I’m no economist.

People are quick to point out that induced demand exists - especially people that aren't fond of change. Very broadly speaking, people mis-estimate effect sizes in economics by orders of magnitude. Induced demand is just their foothold to claim an effect exists, before they go about claiming the effect size they want to see.

I love induced demand. I'm going to use it to get rich - buy up some abandoned town somewhere, and then pay to run a 100 lane superhighway to it; induced demand means the town will fill up instantly and be hugely valuable!

Re: Austin’s surge of new housing construction drove down rents

#99

Post by gknapp » Thu, Mar 19, 2026, 1:12 AM UTC

amelius wrote: post #10

nemomarx wrote: post #3

Good news - experimental verification of the law of supply and demand! I'm sure the analysis is welcome though and I hope policy makers try to learn from this. We could densify most american cities quite a lot more.

What if the people in power don't want prices to go down?

Well, it's easy! Just get the majority of voters to hate each other enough that it's a moral boundary to vote together on any law, effectively limiting any meaningful change.

Re: Austin’s surge of new housing construction drove down rents

#100

Post by shimman » Thu, Mar 19, 2026, 1:13 AM UTC

epistasis wrote: post #83

cg5280 wrote: post #27

Earlier quoted context omitted.

The problem isn’t the powers that be. A lot of regular homeowners fight new developments tooth and nail. And many blue states unfortunately give them a lot of tools to do so.

People want to blame the 1% for massive wealth ineqality, but when it comes to unaffordable housing, a basic necessity of life, the villain is actually about 30% of the population that is rich enough to own homes, act like rentiers, and block access to neighborhoods and opportunities. The greatest inequality difference is that between those with housing assets and those without. Yes the 1% are a problem but they are…

I think the majority of the electorate very much blame the people you're talking about. Who do you think progressives and MAGA refer to when talking about neoliberals? They're talking about the corporate class; those that care more about money but willing to play up useless culture war issues that impact small amounts of people.