It’s Time to Build

Re: Housing

Housing is about the least desirable form of real-estate development for land owners. That's why low cost market housing is built in former cow pastures outside of town and in town market rate housing development tends to be built for upper income and luxury buyers. That's why affordable housing has been done with public subsidy. First as public housing. Then as tax credit financing and housing vouchers. Recently as a condition of building market rate housing.

Real-estate is where wealth is parked with long time horizons. Pension funds and life insurance reserves and intergenerational personal wealth preservation. When wealth preservation is the goal or the investment horizon is thirty years or more, sitting on under-utilized land waiting for a commercial use on a triple net lease provides higher returns than selling houses. Even better if the land is producing rent off the sunk cost...and there's always a market for used car lots. Housing competes with every other use and most uses are much more profitable and stable.

Even leaving land vacant is better than converting to housing when the goal is wealth preservation. In wealth preservation, if you sell, you have to find someplace else to put the money. When real-estate is the wealth preservation vehicle, that means finding another parcel of greater value for equal cost. E.g. a more valuable parcel than the valuable one already in hand.

Germany having top pharma factories for things like testing and other medical stuff seems a good reason

More people have died from mining accidents than nuclear accidents.

You realize he’s one of the main players in your enjoyment of the internet as we see it today right?

Then you somehow proceed to say “well why is Michael Jordan talking about how X player isn’t performing!? He should be out there playing right now”... uh what?

So a player moves to becoming a coach or some support character after decades in the game and that’s your great comment?

> ... The things we build in huge quantities, like computers and TVs, drop rapidly in price. The things we don’t, like housing, schools, and hospitals, skyrocket in price. What’s the American dream? The opportunity to have a home of your own, and a family you can provide for. We need to break the rapidly escalating price curves for housing, education, and healthcare, to make sure that every American can realize the dream, and the only way to do that is to build.

What if building in itself isn't the answer to increasing affordability and ensuring supply of things that matter? What if incentives are the key?

Things the author says drop rapidly in price:

- computers

- TVs

Things the author says skyrocket in price:

- housing

- schools

- hospitals

The former group includes small-ticket items that are often bought with "cash." These are also items with an inherently low regulatory burden.

The latter group includes big-ticket items bought on credit, or paid for by someone else (health insurer). Often, there's a government backstop involved. And these industries have a very heavy regulatory burden.

What if the key to making necessities like housing and education more affordable was to get the federal government out of the business of guaranteeing loans and backstopping reckless investors?