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Because it works better in practice. Consider other markets where supply is not artificially constrained. There are no laws specifying how many cars can be manu

by skewart 11y ago

Because it works better in practice. Consider other markets where supply is not artificially constrained. There are no laws specifying how many cars can be manufactured, or how they can be priced. Manufacturers are able to make cars at a wide range of price points. And the used car market let's people buy at incredibly low prices. Or consider soap. We "let the market decide who is worthy" of soap, and yet there is no soap affordability crisis. Sure, you can spend $12 on a bar of soap, but you can get one for $0.49 too. Imagine if we applied SF housing laws to the car market. Only allow a few thousand new cars to be made every year. Then say manufacturers have to pay a $10,000 fee per car they sell, in addition to taxes on their revenues. Of course the super wealthy start bidding up the price of cars - they're hard to get, and becoming expensive, so it's a status symbol to have one. Existing car owners are happy to see that their current car is going up in value, so they don't want to change anything. Since cars are now so expensive people decide to mandate affordable cars. So a lottery is set up where a handful of new cars get sold at bellow market rates to some very lucky people. This does nothing to make good cars more affordable to the vast majority of people who can no longer afford them. But it lets the people contendedly driving their valuable BMWs and Volvos pat themselves on the back for having done something. Also, going back to housing, fast-growing metropolitan areas that have fewer zoning restrictions tend to have more affordable housing than ones that are anti-housing-construction. Houston, Dallas, and Atlanta have all seen incredible population and job growth but have housing that is far more affordable than in California.

maxerickson 11y ago
Those metros are considerably less geographically constrained. Atlanta is famous for being sort of crappy for that reason (they just keep building more metro rather than doing any consolidation).
Klinky 11y ago
Apples and oranges. The new car market dealership model actually obfuscates the price so much that prices can vary wildly by thousands of dollars for the same model and package options. It is a very consumer unfriendly process. You could even make a claim that regulation is partially to blame for this. The used car market is full of scams, and has the used-car salesmen ever been seen as a trustworthy individual? The independent used-car inspector I went through had a disclaimer that they charge extra to inspect cars on lots out on 82nd ave in Portland because of how notoriously bad they are at selling people lemons. There are many salvage sellers on Craigslist, who fail to mention how badly the car was damaged before being repaired, and those repairs are usually poorly done. Some of the cheapest options are cars with recalls that the seller never mentions in their ad. Soap? The raw materials, use cases and costs involved with soap are so out of align with that of housing, I can't see "it works for soap" being a viable argument. In many poor neighborhoods there are "food/grocery deserts", so access to cheap soap can be an issue.
- maxsilver 11y ago
  > The new car market dealership model actually obfuscates the price so much that prices can vary wildly by thousands of dollars for the same model and package options. It is a very consumer unfriendly process. This is even more true for housing, where prices vary wildly by tens of thousands (or occasionally hundreds of thousands) of dollars for very similar quality/space/location housing. A used car can usually purchased in a single day. A used house can take anywhere from 3-6+ weeks to purchase (from initial offer to actual possession). And housing purchases are so unwieldy that both parties must hire their own agents and insurances (at a cost of thousands of dollars, each) to represent each of them through the entire transaction. Purchasing processes don't get any more unfriendly than that. > The used car market is full of scams, and has the used-car salesmen ever been seen as a trustworthy individual? This is even more true for housing, where scams are so common that they're just automatically factored into housing costs by default as "maintenance". It's even more insane because "multiple things quickly failing" is expected even for brand new housing. To the extreme that brand new cars typically carry a 36 months "everything" warranty, but new houses usually only carry 11-12 months of similar guarantee, despite costing 10-20x more. --- If anything, I wish the housing market was more like buying a car. Because despite all car-buying's flaws, it's at least possible for me to get something I'm fairly content with, at a price I can reasonably afford.

by skewart 11y ago

maxerickson 11y ago

Those metros are considerably less geographically constrained. Atlanta is famous for being sort of crappy for that reason (they just keep building more metro rather than doing any consolidation).

Klinky 11y ago

Apples and oranges. The new car market dealership model actually obfuscates the price so much that prices can vary wildly by thousands of dollars for the same model and package options. It is a very consumer unfriendly process. You could even make a claim that regulation is partially to blame for this. The used car market is full of scams, and has the used-car salesmen ever been seen as a trustworthy individual? The independent used-car inspector I went through had a disclaimer that they charge extra to inspect cars on lots out on 82nd ave in Portland because of how notoriously bad they are at selling people lemons. There are many salvage sellers on Craigslist, who fail to mention how badly the car was damaged before being repaired, and those repairs are usually poorly done. Some of the cheapest options are cars with recalls that the seller never mentions in their ad. Soap? The raw materials, use cases and costs involved with soap are so out of align with that of housing, I can't see "it works for soap" being a viable argument. In many poor neighborhoods there are "food/grocery deserts", so access to cheap soap can be an issue.

maxsilver 11y ago
> The new car market dealership model actually obfuscates the price so much that prices can vary wildly by thousands of dollars for the same model and package options. It is a very consumer unfriendly process. This is even more true for housing, where prices vary wildly by tens of thousands (or occasionally hundreds of thousands) of dollars for very similar quality/space/location housing. A used car can usually purchased in a single day. A used house can take anywhere from 3-6+ weeks to purchase (from initial offer to actual possession). And housing purchases are so unwieldy that both parties must hire their own agents and insurances (at a cost of thousands of dollars, each) to represent each of them through the entire transaction. Purchasing processes don't get any more unfriendly than that. > The used car market is full of scams, and has the used-car salesmen ever been seen as a trustworthy individual? This is even more true for housing, where scams are so common that they're just automatically factored into housing costs by default as "maintenance". It's even more insane because "multiple things quickly failing" is expected even for brand new housing. To the extreme that brand new cars typically carry a 36 months "everything" warranty, but new houses usually only carry 11-12 months of similar guarantee, despite costing 10-20x more. --- If anything, I wish the housing market was more like buying a car. Because despite all car-buying's flaws, it's at least possible for me to get something I'm fairly content with, at a price I can reasonably afford.