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> "Housing is only an investment asset in certain disfunctional housing markets (e.g., NYC, SF). The problem in these markets is that it's illegal to sell only

> "Housing is only an investment asset in certain disfunctional housing markets (e.g., NYC, SF). The problem in these markets is that it's illegal to sell only housing" What's the reason for dysfunction in the UK housing market then? It's perfectly legal to sell only housing over here (note that this graph is adjusted for inflation, people are spending roughly 4x the amount for a house compared to 1952 after correcting for inflation): http://www.jackpeppercampbell.com/wp-content/uploads/2014/07/UK-real-house-prices-since-1952.png http://www.jackpeppercampbell.com/wp-content/uploads/2014/07...

yummyfajitas 11y ago
I'm confused by your link, which describes the price of a speculative investment rather than a consumption good. What dysfunction are you referring to?
- ZenoArrow 11y ago
  Property prices in the UK have risen rapidly at least in part because they are seen as a long term investment. You previously implied that housing 'is only an investment asset in certain disfunctional housing markets (e.g., NYC, SF). The problem in these markets is that it's illegal to sell only housing'. I am providing a counter-example.
  - yummyfajitas 11y ago
    "Only housing" means a rental of a flat to live in for a fixed term. It's a consumption good. Buying property is a speculative investment. Similarly, buying an iPad is consumption while buying AAPL is investment.
    - ZenoArrow 11y ago
      I don't understand what you mean by '"Only housing" means a rental of a flat to live in for a fixed term.'. Are you referring to investment in the rental market?
      - yummyfajitas 11y ago
        I'm referring to consumption of housing. Renting a house to live in with no prospect of reselling it. You are discussing the purchasing of a long term stream of housing with the prospect of resale at some future point.
        ZenoArrow 11y ago
        > "I'm referring to consumption of housing. Renting a house to live in with no prospect of reselling it." If you rent then you don't have the rights to sell, renting a property isn't an investment anywhere in the world (as far as I know), how is that different in NYC and SF? Is this some sort of freehold/leasehold issue (leasehold may be a UK-only arrangement, not sure if it exists elsewhere)?
        yummyfajitas 11y ago
        In NYC and SF, you can't generally rent for a fixed term: "Can my landlord evict me and use my stabilized apartment for his or her family, and how many apartments in the building can the landlord take? One of the advantages of being a rent stabilized tenant is the statutory right to renew your lease." http://www.nycrgb.org/html/resources/faq/rentstab.html http://www.nycrgb.org/html/resources/faq/rentstab.html Once you lease a unit you essentially hold weakly transferable long term property rights to the unit. You also own, via local zoning regulations, the partial right to prevent neighbors from doing new things with their property.
grandinj 11y ago
I would guess the severe restrictions on building new homes which leads to a dramatic undersupply of new housing stock. Which in turn pushes up the price of existing stock and feeds an asset bubble.
- ZenoArrow 11y ago
  That's part of the issue, the but another part is bankers seeing property mortgages as safe ways to invest money, which has led to higher lending over time.

yummyfajitas 11y ago

I'm confused by your link, which describes the price of a speculative investment rather than a consumption good. What dysfunction are you referring to?

ZenoArrow 11y ago
Property prices in the UK have risen rapidly at least in part because they are seen as a long term investment. You previously implied that housing 'is only an investment asset in certain disfunctional housing markets (e.g., NYC, SF). The problem in these markets is that it's illegal to sell only housing'. I am providing a counter-example.
- yummyfajitas 11y ago
  "Only housing" means a rental of a flat to live in for a fixed term. It's a consumption good. Buying property is a speculative investment. Similarly, buying an iPad is consumption while buying AAPL is investment.
  - ZenoArrow 11y ago
    I don't understand what you mean by '"Only housing" means a rental of a flat to live in for a fixed term.'. Are you referring to investment in the rental market?
    - yummyfajitas 11y ago
      I'm referring to consumption of housing. Renting a house to live in with no prospect of reselling it. You are discussing the purchasing of a long term stream of housing with the prospect of resale at some future point.
      - ZenoArrow 11y ago
        > "I'm referring to consumption of housing. Renting a house to live in with no prospect of reselling it." If you rent then you don't have the rights to sell, renting a property isn't an investment anywhere in the world (as far as I know), how is that different in NYC and SF? Is this some sort of freehold/leasehold issue (leasehold may be a UK-only arrangement, not sure if it exists elsewhere)?
        yummyfajitas 11y ago
        In NYC and SF, you can't generally rent for a fixed term: "Can my landlord evict me and use my stabilized apartment for his or her family, and how many apartments in the building can the landlord take? One of the advantages of being a rent stabilized tenant is the statutory right to renew your lease." http://www.nycrgb.org/html/resources/faq/rentstab.html http://www.nycrgb.org/html/resources/faq/rentstab.html Once you lease a unit you essentially hold weakly transferable long term property rights to the unit. You also own, via local zoning regulations, the partial right to prevent neighbors from doing new things with their property.

grandinj 11y ago

I would guess the severe restrictions on building new homes which leads to a dramatic undersupply of new housing stock. Which in turn pushes up the price of existing stock and feeds an asset bubble.

ZenoArrow 11y ago
That's part of the issue, the but another part is bankers seeing property mortgages as safe ways to invest money, which has led to higher lending over time.