4 ms·

> Housing is a free market I would encourage you to attend some planning hearings, city council meetings, and so on before asserting that. Because it really,

by davidw 9y ago

> Housing is a free market I would encourage you to attend some planning hearings, city council meetings, and so on before asserting that. Because it really, really isn't. Look at a zoning map of your city.

kbenson 9y ago
I mean the buying and selling of existing houses, not the building of new houses. Those comments are primarily with respect to what could happen to the housing market for existing homes in a city that implements large changes housing policy.
- kjksf 9y ago
  If you believed in principles of free market you wouldn't start by explaining how bad it is for person X that their investment dropped in value. They made a bet, they lost it. Someone else made a different bet and won. That's how free market works. People are free to make bets and they loose or win based on how right they were. Trying to enact policies that mess with market forces because you want to protect that person who lost the bet is the opposite of free market and also a bad economic policy. Economists estimate that lack of housing in California is costing us all a lot. From https://www.wsj.com/articles/californias-housing-costs-hurt-economy-increase-poverty-report-finds-1426623141 https://www.wsj.com/articles/californias-housing-costs-hurt-...: > California’s high housing costs are crimping economic productivity, increasing poverty rates, lowering homeownership, increasing crowding and lengthening commute time This is the cost of protecting the investment of your hypothetical family not paying "unfair" prices. Not to mention that your hypothetical scenario wouldn't happen if we had reasonable zoning policies to begin with. The only reason price of a house could significantly go down due to new construction is that we allowed to prices to go up 10x in the past. If we were building enough to meet the demand, everyone would be paying roughly the same price and price increases would roughly match inflation, not exceed it by miles.
  - davidw 9y ago
    I kind of get his point though: what if all this is pushed to the breaking point, and things snap suddenly? First of all, I just don't think that will happen. Regulations aren't changing quickly, houses aren't that fast to build, and if prices start to go down, building is going to slow down too. Second of all, if "the dam breaks", it's only because of years and years of doing the wrong thing, so yeah, it still sucks for whoever gets caught out, but the longer you put off fixing things, the worse it's going to be.
  - kbenson 9y ago
    > If you believed in principles of free market you wouldn't start by explaining how bad it is for person X that their investment dropped in value. Houses are bought and sold on a free market. Houses are so much more than just an investment to the majority of people that purchase them. If you disagree with that, fine. Feel free to work towards changing many decades, if not centuries, of culture. > They made a bet, they lost it. There many are reasons why the government, whether it be local, state or federal might not want to punish people that tried to set down roots to establish stability just because other people decided that was a good market to play in, even if the latter group's thinking has infected the former to some degree. > That's how free market works. People are free to make bets and they loose or win based on how right they were. Yes. The problem here is that while a free market is agreed upon by many people to be an effective way to make sure the housing market is somewhat fair, it's also a very dangerous way to allow a very important resource to be handled if there are no controls. Would you argue that bread and meat should be allowed to reach 1000% or more the current price in a short period, or should the government step in to stabilize the market because these are essentials for many people? What about electricity? Housing isn't quite on the same level, but it's important and is not some abstract fungible product to the majority of people. > Trying to enact policies that mess with market forces because you want to protect that person who lost the bet is the opposite of free market and also a bad economic policy. No, providing stabilizing controls to markets is not bad economic policy. If you think so, perhaps we should abolish the Federal Reserve, and just let the market do what it wants? How bad can it get? Geez, why did we even start the Fed anyway... > If we were building enough to meet the demand, everyone would be paying roughly the same price and price increases would roughly match inflation, not exceed it by miles. Then let's do that, and let's look to make sure we're actually doing that by tracking demand, and prices, and trying to make sure we make informed decisions. Has a single thing I've said lead to you believe I'm not for that? Because I'm pretty sure I've advocated for exactly that type of thing in every comment.

by davidw 9y ago

kbenson 9y ago

I mean the buying and selling of existing houses, not the building of new houses. Those comments are primarily with respect to what could happen to the housing market for existing homes in a city that implements large changes housing policy.

kjksf 9y ago
If you believed in principles of free market you wouldn't start by explaining how bad it is for person X that their investment dropped in value. They made a bet, they lost it. Someone else made a different bet and won. That's how free market works. People are free to make bets and they loose or win based on how right they were. Trying to enact policies that mess with market forces because you want to protect that person who lost the bet is the opposite of free market and also a bad economic policy. Economists estimate that lack of housing in California is costing us all a lot. From https://www.wsj.com/articles/californias-housing-costs-hurt-economy-increase-poverty-report-finds-1426623141 https://www.wsj.com/articles/californias-housing-costs-hurt-...: > California’s high housing costs are crimping economic productivity, increasing poverty rates, lowering homeownership, increasing crowding and lengthening commute time This is the cost of protecting the investment of your hypothetical family not paying "unfair" prices. Not to mention that your hypothetical scenario wouldn't happen if we had reasonable zoning policies to begin with. The only reason price of a house could significantly go down due to new construction is that we allowed to prices to go up 10x in the past. If we were building enough to meet the demand, everyone would be paying roughly the same price and price increases would roughly match inflation, not exceed it by miles.
- davidw 9y ago
  I kind of get his point though: what if all this is pushed to the breaking point, and things snap suddenly? First of all, I just don't think that will happen. Regulations aren't changing quickly, houses aren't that fast to build, and if prices start to go down, building is going to slow down too. Second of all, if "the dam breaks", it's only because of years and years of doing the wrong thing, so yeah, it still sucks for whoever gets caught out, but the longer you put off fixing things, the worse it's going to be.
- kbenson 9y ago
  > If you believed in principles of free market you wouldn't start by explaining how bad it is for person X that their investment dropped in value. Houses are bought and sold on a free market. Houses are so much more than just an investment to the majority of people that purchase them. If you disagree with that, fine. Feel free to work towards changing many decades, if not centuries, of culture. > They made a bet, they lost it. There many are reasons why the government, whether it be local, state or federal might not want to punish people that tried to set down roots to establish stability just because other people decided that was a good market to play in, even if the latter group's thinking has infected the former to some degree. > That's how free market works. People are free to make bets and they loose or win based on how right they were. Yes. The problem here is that while a free market is agreed upon by many people to be an effective way to make sure the housing market is somewhat fair, it's also a very dangerous way to allow a very important resource to be handled if there are no controls. Would you argue that bread and meat should be allowed to reach 1000% or more the current price in a short period, or should the government step in to stabilize the market because these are essentials for many people? What about electricity? Housing isn't quite on the same level, but it's important and is not some abstract fungible product to the majority of people. > Trying to enact policies that mess with market forces because you want to protect that person who lost the bet is the opposite of free market and also a bad economic policy. No, providing stabilizing controls to markets is not bad economic policy. If you think so, perhaps we should abolish the Federal Reserve, and just let the market do what it wants? How bad can it get? Geez, why did we even start the Fed anyway... > If we were building enough to meet the demand, everyone would be paying roughly the same price and price increases would roughly match inflation, not exceed it by miles. Then let's do that, and let's look to make sure we're actually doing that by tracking demand, and prices, and trying to make sure we make informed decisions. Has a single thing I've said lead to you believe I'm not for that? Because I'm pretty sure I've advocated for exactly that type of thing in every comment.