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

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

#811

Post by jpfromlondon » Thu, Mar 19, 2026, 3:18 PM UTC

pclowes wrote: post #176

Its wild how the solution to housing costs is really just: Build more housing. Keep law and order. No it doesn’t need to be “affordable”. Yes rent control is a terrible idea. Just build more housing. Note: that the US already has plenty of housing and housing costs basically go up in areas of low crime relative to economic opportunity. If you build housing, but allow crime to rise, you have wasted everybody’s time.

truly incredible, instead of subsidizing demand you build more houses and just like that they're more affordable, somebody should write some economic theories on this.

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

#812

Post by lesuorac » Thu, Mar 19, 2026, 3:19 PM UTC

pembrook wrote: post #720

lesuorac wrote: post #690

Earlier quoted context omitted.

We do throw out everything from physics 101. The movement of satellites is not modeled using distance = speed * time. It would do well to consider if econ 101 is an accurate way to model the world since for other domains the 101 course is not.

Yet the overwhelming factor in modeling the movement of those satellites is still distance = speed * time. The existence of nuance and external factors don't negate the original principle. The equivalent to arguments made by 'economics deniers' in this thread would be if you argued: the satellite moving at 7.8 km/s actually causes the earth to spin 8 km/s faster, so trying to make the satellite move faster makes it g…

> The existence of nuance and external factors don't negate the original principle.

Eh, ok throwing out all of physics 101 is a little strong. But you still don't use the original formulas you learned to do actual analysis. So using the basic models from econ 101 to do analysis can lead you to incorrect answers (but also correct ones; from a False premise you can imply both True and False; see "Material Implication" [1]).

So sure on a forum like HN it can be appropriate to use basic econ 101 logic but when somebody is trying to be an expert or write an article for thousands+ people you should really question why they're only using 101 logic.

> Let's not do the HN thing and get lost in pedantry.

Lets actually do the not HN thing and read the article.

There's too little rigor in the article to support the argument in the title. The articles _own numbers_ are that after building 120k housing units the rent went up 85% (4% decrease after 96% increase). Just looking causally at this the only data in the article supports more housing = more rent; the article is only casual observations so little reason to do anything else ...

[1]: https://en.wikipedia.org/wiki/Boolean_algebra#Secondary_oper...

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

#813

Post by BobbyJo » Thu, Mar 19, 2026, 3:26 PM UTC

alistairSH wrote: post #781

giaour wrote: post #744

Earlier quoted context omitted.

> I've never understood this: If I replace a single home with 20 apartment homes, I've raised the value of the whole property at purchase time no? It's a commons problem. In your scenario, you have absolutely increased the value of your property. 20 apartments is more valuable than a single family home. However, you have also reduced aggregate demand by housing 20 people. That reduced the value of your neighbors' pro…

Are there any real examples of this actually happening? Local to me, Arlington and Reston VA have both seen massive building sprees over the past 20ish years (mostly adjacent to the Metro). Home values have never been higher in either location. My own personal example... I live ~1 mile from the Metro, so just outside the building boom zone. There was next to zero housing in that zone - it was all office parks - and n…

Literally the entire peninsula of the bay area is an example of this happening. You have people voting to "keep their small town feel" sandwiched between San Francisco and San Jose.

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

#814

Post by triceratops » Thu, Mar 19, 2026, 3:29 PM UTC

bombcar wrote: post #797

hunterpayne wrote: post #493

Earlier quoted context omitted.

Can you guess what the #1 source of wealth increase in the AA community has been over the last 20 years? That's right, grandma's house...guess where she lived.

This is a huge important part - if gentrification of an AA community occurs in an area where the homes are owned by the residents, it's a great wealth-growing event; generational even. If the gentrification of an AA community occurs where the residents rent then they capture none of it and are forced out.

Let's assume communities are rated on a scale of 1 to 10. A "gentrified community" goes from being a 3 to being an 8. Renters are forced to move because they can't afford 8/10-rated-community rents, while existing owners profit handsomely. On this we all agree.

Where do the new residents of this now-8/10 community come from? Probably a place that was less than 8/10 - maybe it was 7. So now there's less demand for all the 7s and their rents decrease, allowing residents living in 6s to move there. And so on.

Assuming housing construction in the region has kept up with the population, even the renters who were forced out of the previously 3/10 community will likely find new housing in a 4/10 neighborhood at the same price. Their relationships from the old place were probably disrupted by the move (bad) but they also got better housing for the same money (good).

The key in this is housing construction must be allowed to increase with population.

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

#815

Post by [deleted] » Thu, Mar 19, 2026, 3:30 PM UTC

bluegatty wrote: post #378

pclowes wrote: post #176

Its wild how the solution to housing costs is really just: Build more housing. Keep law and order. No it doesn’t need to be “affordable”. Yes rent control is a terrible idea. Just build more housing. Note: that the US already has plenty of housing and housing costs basically go up in areas of low crime relative to economic opportunity. If you build housing, but allow crime to rise, you have wasted everybody’s time.

Rent control is one of the best ideas, and it may be a civilizational, foundational idea. Property ownership is at the very core of entrenched power, and the foundation of rent-seeking and wealth asymmetry. If you look at even the Monarchs of long past - it wasn't their 'titles' that made them powerful - it was the economic rent that came along with the land ownership. Even in more open market economies, property is…

[deleted]

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

#816

Post by larsiusprime » Thu, Mar 19, 2026, 3:31 PM UTC

testing22321 wrote: post #810

brazzy wrote: post #789

Earlier quoted context omitted.

Except they cannot increase rents when there is enough supply for a market to actually work.

The market will remain irrational longer than… Of course they can when they own them all. See De Beers diamonds. Buy them all, keep the price artificially high.

Diamond prices are famously crashing now due to artificial lab made diamonds (increased supply)

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

#817

Post by idbnstra » Thu, Mar 19, 2026, 3:32 PM UTC

testing22321 wrote: post #774

exabrial wrote: post #741

Earlier quoted context omitted.

Build more housing

If investment companies that already own tens of thousands of homes buy them and keep increasing the rent, the problem has not been solved.

land value tax would fix this

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

#818

Post by triceratops » Thu, Mar 19, 2026, 3:33 PM UTC

7speter wrote: post #413

triceratops wrote: post #302

Earlier quoted context omitted.

Unless all of the housing is owned by non-residents prior to gentrification, some residents always benefit from their neighborhood going upscale. Either through increased home values, allowing them to sell and improve their lives. Or because it's now a more pleasant area to live in. Even renters in gentrifying areas may profit if housing construction outpaces population growth. Yes, they may have to move, but also th…

When people in NYC are driven out of their neighborhoods because of gentrification, they generally move down south. There isn’t some magical part of town that they can afford with their “current budget”

> There isn’t some magical part of town that they can afford with their “current budget”

Literally impossible unless:

1. People are living in multiple houses

2. New construction hasn't kept up with population growth

We're commenting on an article that says the exact same thing.

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

#819

Post by BobbyJo » Thu, Mar 19, 2026, 3:34 PM UTC

chmod775 wrote: post #681

pinkmuffinere wrote: post #376

Earlier quoted context omitted.

I'm confused by this objection, if you draw a stereotypical supply and demand curve, you can see how prices settle to an equilibrium point. Of course reality has more complications, but I think your objection is 95% answered by a supply and demand curve. You keep building houses when it is profitable. You stop when it is not. This naturally keeps everything in balance.

Free markets for housing are likely to settle into an "optimum" where some percentage of people cannot afford housing at all, because while construction/rental of housing for them would net a return, it's not worth the opportunity cost. Plus you should not wait for the market to respond to a lack of housing: people will be homeless in the meantime. Supply/demand is mostly reactive, because building for anticipated fu…

> Free markets for housing are likely to settle into an "optimum" where some percentage of people cannot afford housing at all, because while construction/rental of housing for them would net a return, it's not worth the opportunity cost

You provide no basis for the idea that the returns on housing have to drop below the point at which its financially viable to build before housing becomes affordable. You just say "because" then restate your premise.

> Markets don't optimize for "everyone gets some", yet that's precisely what you need for housing.

Just because markets don't optimize for it, doesn't mean it doesn't achieve it.

> You'll always need the government to come in at some point to provide for those left behind by the free market.

Disagree.

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

#820

Post by underlipton » Thu, Mar 19, 2026, 3:37 PM UTC

pclowes wrote: post #176

Its wild how the solution to housing costs is really just: Build more housing. Keep law and order. No it doesn’t need to be “affordable”. Yes rent control is a terrible idea. Just build more housing. Note: that the US already has plenty of housing and housing costs basically go up in areas of low crime relative to economic opportunity. If you build housing, but allow crime to rise, you have wasted everybody’s time.

I don't know how much I buy this. Washington, DC added about 60,000 units between 2015 and now, so a little less proportionally to Austin (with 1 million residents vs 650k). Metro area, 160k more in DC, with a population of 3 million (vs 2.5 million in Austin). Even if DC's unit add is slower than Austin's, you'd expect median rent changes to be within the ballpark, right? Maybe only a slight increase instead of the small decrease Austin saw?

No. Rent doubled.

I don't know if Austin or DC is an outlier, but considering how many states sued property managers and their rental management software providers over price-fixing, I'm leaning toward Austin. In the rest of the country, building more doesn't lower rents. Lowering rents lowers rents. And you have to force landlords to do so.