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The rich world needs cheaper housing. Fix that and the average family can allocate more resources to other things like health and education instead of diverting

The rich world needs cheaper housing. Fix that and the average family can allocate more resources to other things like health and education instead of diverting more resources to rent seekers.

Synaesthesia 8y ago
Economist Michael Hudson often writes about this. The housing bubble is mostly beneficial to banks, as they get more interest. They know that house prices will go as high as they are willing to lend out.
- qaq 8y ago
  Right if only there ever was an event when this strategy backfired ...
- paxys 8y ago
  And to existing homeowners, who also conveniently get to drive housing policy in their neighborhoods.
IkmoIkmo 8y ago
How though? I mean, houses themselves haven't really gotten much more expensive. Two things have happened. One, we're all living much larger than before. i.e., our average home sizes have doubled in about 50 years, while the number of people per household dropped. [0] That's a sign of wealth more than anything else. And two, we've all decided to live next to each other. That's a choice. It's a choice coerced by reality, e.g. jobs being in population centres like cities, but it's a tradeoff between affordability and proximity to an economic, cultural, political and social centre. Housing in and of itself is not unaffordable, only in certain conditions. Affordable housing today would become unaffordable if we decided we wanted homes twice as big with fewer people living there. Or it'd be unaffordable if we all decided to want to live on the same tiny piece of land. For a little context, if you look at population density in the US, it's 33 per km2 on average. That's about 5.5 football fields per person, or in other words, about 22 football fields of space for parents with two kids. Compare that to a city block in in Washington which holds 38.000 people per km2, more than 1000x the population density of the US. It looks like this [1]. This shows how concentrated we really live in some places we call unaffordable. Most of the cost of housing actually isn't the home itself. Homes are pretty cheap to build. A 1200 square feet home for two people costs on average about $150k to build, or $75k per person. That's about 2 years of the median personal income in the US. The big expense is in the land, but only in some places. It's unaffordable because we choose to live at 1000x the population density of the average in the country. If you've got 1000 plots of land, and we all decide to live on one of them, and across 50 years double our home size and reduce number of people we share our homes with, no wonder it's unaffordable. The solution in part has to do with building more homes, zoning laws, construction red tape. But mostly, it has to do with the fundamental fact that we live larger and more concentrated. We need an economic and cultural shift against that. Urbanisation is great, I live in a city, but we have to do away with the model of a few hotspots and decentralise more, invest more in smaller cities, remote working, and infrastructure that connects cities. There's no zoning law that keep ultra-concentration affordable. [0] https://2static1.fjcdn.com/comments/House+size+and+family+size+_2361315d6c40da1177fee62a7aae80bb.jpg https://2static1.fjcdn.com/comments/House+size+and+family+si... Plenty of similar sources. This occurs in many countries outside the US, too. It occurs in many countries outside the US, too. [1] https://ggwash.org/images/posts/201608-031125-3.png https://ggwash.org/images/posts/201608-031125-3.png
- rdlecler1 8y ago
  There are plenty of cheap houses in Reno. I’d love to move there but even though it’s only a half hour flight from Silicon Valley I need to be based here for my job. Maybe the solution to housing is just much better teleconferencing technology.

The rich world needs cheaper housing. Fix that and the average family can allocate more resources to other things like health and education instead of diverting more resources to rent seekers.

Synaesthesia 8y ago

Economist Michael Hudson often writes about this. The housing bubble is mostly beneficial to banks, as they get more interest. They know that house prices will go as high as they are willing to lend out.

qaq 8y ago
Right if only there ever was an event when this strategy backfired ...
paxys 8y ago
And to existing homeowners, who also conveniently get to drive housing policy in their neighborhoods.

IkmoIkmo 8y ago

How though? I mean, houses themselves haven't really gotten much more expensive. Two things have happened. One, we're all living much larger than before. i.e., our average home sizes have doubled in about 50 years, while the number of people per household dropped. [0] That's a sign of wealth more than anything else. And two, we've all decided to live next to each other. That's a choice. It's a choice coerced by reality, e.g. jobs being in population centres like cities, but it's a tradeoff between affordability and proximity to an economic, cultural, political and social centre. Housing in and of itself is not unaffordable, only in certain conditions. Affordable housing today would become unaffordable if we decided we wanted homes twice as big with fewer people living there. Or it'd be unaffordable if we all decided to want to live on the same tiny piece of land. For a little context, if you look at population density in the US, it's 33 per km2 on average. That's about 5.5 football fields per person, or in other words, about 22 football fields of space for parents with two kids. Compare that to a city block in in Washington which holds 38.000 people per km2, more than 1000x the population density of the US. It looks like this [1]. This shows how concentrated we really live in some places we call unaffordable. Most of the cost of housing actually isn't the home itself. Homes are pretty cheap to build. A 1200 square feet home for two people costs on average about $150k to build, or $75k per person. That's about 2 years of the median personal income in the US. The big expense is in the land, but only in some places. It's unaffordable because we choose to live at 1000x the population density of the average in the country. If you've got 1000 plots of land, and we all decide to live on one of them, and across 50 years double our home size and reduce number of people we share our homes with, no wonder it's unaffordable. The solution in part has to do with building more homes, zoning laws, construction red tape. But mostly, it has to do with the fundamental fact that we live larger and more concentrated. We need an economic and cultural shift against that. Urbanisation is great, I live in a city, but we have to do away with the model of a few hotspots and decentralise more, invest more in smaller cities, remote working, and infrastructure that connects cities. There's no zoning law that keep ultra-concentration affordable. [0] https://2static1.fjcdn.com/comments/House+size+and+family+size+_2361315d6c40da1177fee62a7aae80bb.jpg https://2static1.fjcdn.com/comments/House+size+and+family+si... Plenty of similar sources. This occurs in many countries outside the US, too. It occurs in many countries outside the US, too. [1] https://ggwash.org/images/posts/201608-031125-3.png https://ggwash.org/images/posts/201608-031125-3.png

rdlecler1 8y ago
There are plenty of cheap houses in Reno. I’d love to move there but even though it’s only a half hour flight from Silicon Valley I need to be based here for my job. Maybe the solution to housing is just much better teleconferencing technology.