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> Land is expensive due to artificial scarcity created wholly by regulation. This is a bit of a strawman. I suggest you broaden your perspective and don't only

> Land is expensive due to artificial scarcity created wholly by regulation. This is a bit of a strawman. I suggest you broaden your perspective and don't only rely on narrow US anecdotes in order to try to explain global phenomena. I live in Asia where there are essentially, especially from a Western perspective, zero regulations. (I've never seen a house with a smoke detector, for instance.) And land is still expensive. In a country where the per-capita GDP is under $3,000 a year, the houses in my neighborhood still cost over $500,000 and most of that is the value of land (parts & labor for building a house of that size are only about $150,000). And the city I live in has a population over 13,000,000. "Building up" doesn't happen magically. It takes investors willing to put up tens to hundreds of millions of dollars for an uncertain payoff many years in the future. That kind capital simply isn't trivially available here. The road to my house is wide enough for a single car -- and it is in quite poor condition. The roads flood every year (up to about half a meter) during the monsoon and "flooding" means sewers are backed up so it isn't pristine water we're talking about. All of that infrastructure needs to be improved to increase density by "building up". In a developing country, those things are in the condition they are because the local city has an insufficient tax base to fix things in the short term. Again, it doesn't happen magically, easily, or instantly. What's more, there are constraints to "build up". Every house in my area is already four stories tall. Because of the high water table, there's no such things as "foundations", so every house is built on top of dozens of steel piles driven 20 meters into the ground. Construction of new houses regularly causes damage to adjacent houses, due to the unstable land. Construction here is primarily of brick, which has height limits due to weight. You can use other materials but then you have additional costs of needing to import materials and not having workers with experience in it. Sure, it is possible to take all those four story houses and turn them into eight story houses. It just takes an extra level of complexity of architecture and construction.

vsskanth 6y ago
What about Japan ? I read somewhere that they have manageable housing costs even in Tokyo. If true, how did they achieve it ?
- staticman2 6y ago
  They have a declining population, which I imagine helps.
  - presentation 6y ago
    The country is in decline but cities like Tokyo and Osaka continue to experience significant growth - it’s the large number of small rural towns that are getting eviscerated.
- primrose 6y ago
  The affordable housing is not in Tokyo but outside the city with a decent commute. Also, Japanese national debt is 258% of GDP. I don't know how much incentives are put into housing but I got to imagine the government is spending it everywhere. The housing is also built poorly and houses are rebuilt every few decades.
  - bleepblorp 6y ago
    Do you know to what extent the short life of Japanese housing is a cultural or geographic issue? I've read that the Japanese simply don't like living in older buildings, so their housing stock is built with the understanding that it will be torn down and rebuilt on fairly short timescales. I've also read that the frequency of small earthquakes in Japan makes building for the long term very difficult (earthquake damage to structures is cumulative) so it's easier to build housing with a short design life. However, I don't read a word of Japanese so I have no idea if either of these stories are accurate.
    - presentation 6y ago
      It is accurate - I live in Japan, it’s a city that’s been destroyed pretty much every few decades either by war or natural calamity - houses beyond 30 years are generally worthless beyond their land value, probably negative since the next tenant will just demolish them. People feel unsafe about earthquake safety of buildings built before the earthquake code changed around 40 years ago and generally wary of older houses in general. Plus people just want creature comforts of better soundproofing, climate control and so on.
jjeaff 6y ago
It's not a strawman at all. I'm not talking about regulations like requiring fire alarms. I'm talking about zoning regulations as well as environmental regulations that are usually well meaning, and maybe even necessary, but are more frequently used as a kudgel by local landowners to keep out any newcomers. You can buy land in rural middle America for $2,500 an acre and build a nice house on it for $100k. And no, not the middle of nowhere. These areas have water and electric utility service as well as major highway access. Much of Asia has a much higher population density than the U.S. Land prices are likely higher their due to actual scarcity.

vsskanth 6y ago

What about Japan ? I read somewhere that they have manageable housing costs even in Tokyo. If true, how did they achieve it ?

staticman2 6y ago
They have a declining population, which I imagine helps.
- presentation 6y ago
  The country is in decline but cities like Tokyo and Osaka continue to experience significant growth - it’s the large number of small rural towns that are getting eviscerated.
primrose 6y ago
The affordable housing is not in Tokyo but outside the city with a decent commute. Also, Japanese national debt is 258% of GDP. I don't know how much incentives are put into housing but I got to imagine the government is spending it everywhere. The housing is also built poorly and houses are rebuilt every few decades.
- bleepblorp 6y ago
  Do you know to what extent the short life of Japanese housing is a cultural or geographic issue? I've read that the Japanese simply don't like living in older buildings, so their housing stock is built with the understanding that it will be torn down and rebuilt on fairly short timescales. I've also read that the frequency of small earthquakes in Japan makes building for the long term very difficult (earthquake damage to structures is cumulative) so it's easier to build housing with a short design life. However, I don't read a word of Japanese so I have no idea if either of these stories are accurate.
  - presentation 6y ago
    It is accurate - I live in Japan, it’s a city that’s been destroyed pretty much every few decades either by war or natural calamity - houses beyond 30 years are generally worthless beyond their land value, probably negative since the next tenant will just demolish them. People feel unsafe about earthquake safety of buildings built before the earthquake code changed around 40 years ago and generally wary of older houses in general. Plus people just want creature comforts of better soundproofing, climate control and so on.

jjeaff 6y ago

It's not a strawman at all. I'm not talking about regulations like requiring fire alarms. I'm talking about zoning regulations as well as environmental regulations that are usually well meaning, and maybe even necessary, but are more frequently used as a kudgel by local landowners to keep out any newcomers. You can buy land in rural middle America for $2,500 an acre and build a nice house on it for $100k. And no, not the middle of nowhere. These areas have water and electric utility service as well as major highway access. Much of Asia has a much higher population density than the U.S. Land prices are likely higher their due to actual scarcity.