28 ms·

The profit/investment motive is fundamentally behind the scarcity of affordable housing.

by jahaja 6y ago

pksebben 6y ago
There's also the "protect-my-pie-ism" that skilled labor unions engage in. We have cheap alternatives to heavy metal pipes, but they're outlawed in a lot of places because of the pipefitters' lobbies. Same goes for a lot of other building codes under the guise of safety - the system is deliberately made inefficient to protect jobs. Personally, I blame the system of incentives created by late-stage capitalism. It's more beneficial to litigate your job to a safe place than to learn a new or more efficient method of accomplishing the same job.
- ben_w 6y ago
  > We have cheap alternatives to heavy metal pipes Wait, are you saying America uses lead pipes, not PVC or copper?
  - pksebben 6y ago
    That is precisely what I am saying. It's not everywhere, but there are places (like NY) where it is illegal according to building codes to use pvc. Because any old schmo can work with pvc (although, the law is written as if it's a safety hazard)
- jahaja 6y ago
  But that would just make it somewhat more expensive to build. The problem is that the supply is always kept insufficient. If, for example, the government would build good quality housing according to need, the housing market would implode. To build according to need was the default in here in Sweden before ~1990.
  - pksebben 6y ago
    Making it more expensive translates to a lack of supply - the government has far more limited resources than huge real estate development firms. The pipes thing is just an example. Of course, this is one of a great many factors that make it nigh-impossible to get affordable government housing built. Not the least of which is the actual expense of land vs. cash-strapped local governments (who are broke because our tax system sucks and we spend what little money we do have on subsidies for businesses.) It's a systemic issue - the incentives that we have lead to a governmental inability to function at all levels. Pick any random piece and you can find a reason that it's hard to do meaningful work.
    - jahaja 6y ago
      Sorry but to imagine that labour costs and unions are somehow responsible for the housing shortage is just a strange distraction. We had labour unions in Sweden with good working conditions & benefits etc etc all along that period. The goal to inflate the price of housing is the main issue.
      - pksebben 6y ago
        You're absolutely right - that is the main issue. I'm not suggesting for a moment that fixing labor union litigation would fix housing. It wouldn't. I was using the pipes as an accessible example of what is a single piece of a very, very large mosaic. The assertion I intended to make was precisely this: That it is impossible to point to a single bad actor (although, you are likely correct in pointing out the most egregious of them). The core issue (IMO, the thing to fix) is that the system of incentives that surrounds the developers, contractors, politicians, homeowners, and everyone else involved rewards slicing the pie over making more pie. Adding value, when it's easier to litigate your way into aquiring a larger share of existing value, is pointless from any individual's standpoint. Take a look at the debacle that surrounded the Stuyvesant Town housing projects - this is a case where this sort of pie-slicing quite nearly made it through, but was struck down by the courts. I use this example because due to it's failure the techniques involved are clearly visible: https://www.theatlantic.com/business/archive/2010/01/america-s-most-expensive-real-estate-deal-goes-bust/346884/ https://www.theatlantic.com/business/archive/2010/01/america... ...my central assertion is that the pipes and deals like this are motivated by the same underlying socioeconomic factors. And too many lawyers.
Kalium 6y ago
Do you have a good example of removing the profit/investment motive and the result being enough housing for everyone?
- jahaja 6y ago
  Yes, Sweden ~1990. There was an agency responsible for adapting housing availability after need. If there was a shortage, it was acted upon. Then the whole homeownership wave, markets etc came.
  - Kalium 6y ago
    That's fascinating! Is there anything I could read about this? I would love to hear more about a rich first-world country being able to meet literally everyone's housing needs fully and in a timely manner without using a market economy.
    - jahaja 6y ago
      This is a good start: https://en.m.wikipedia.org/wiki/Million_Programme https://en.m.wikipedia.org/wiki/Million_Programme
      - deleted 6y ago
        [deleted]
      - Kalium 6y ago
        Reading the description there, it seems to rest heavily on profit motives. Perhaps I have missed something? I would love an example of housing for everyone in locations that meets their needs, achieved in a timely manner, in a way that removes profit and investment motives.
        jahaja 6y ago
        > it seems to rest heavily on profit motives What part are you referring to? > I would love an example of housing for everyone in locations that meets their needs, achieved in a timely manner, in a way that removes profit and investment motives. Well, on the other hand, is there something inherent in housing that requires those motives?
DubiousPusher 6y ago
This is why I focused my point around the cost of the structure. The costs of land (made expensive by policy) and capital (made cheap by policy) are much more complex. But regardless of that, even if you buy cheap land in a low regulation county/state and use all non-union labor, the building cost is still more expensive than it would be if buildings had the reduction of costs that other durable goods have had over time. Some of this is clearly regulatory, i.e. codes. Some is clearly consumer choice, note the failure of prefab and tilt up to catch on. Some is clearly ecology, note the disappearance of native large timber from most residential construction. Many architects and builders have tried their hand at designing homes and construction processes that reduce the costs of buildings but if they have to build to modern codes, expectations and ecological standards they mostly see marginal improvements. There are just a lot of fundamental costs involved with site constructed buildings that meet modern standards.
- jahaja 6y ago
  Sure, there's additions. But I would be careful to deduce consumer choice from what is most risk-free/profitable, a.k.a. the market. Cheap, decent quality "projects" would also be rented out in no time. But the profit margin and risk assessment isn't in favour of that.

The profit/investment motive is fundamentally behind the scarcity of affordable housing.

by jahaja 6y ago

The profit/investment motive is fundamentally behind the scarcity of affordable housing.

There's also the "protect-my-pie-ism" that skilled labor unions engage in. We have cheap alternatives to heavy metal pipes, but they're outlawed in a lot of places because of the pipefitters' lobbies. Same goes for a lot of other building codes under the guise of safety - the system is deliberately made inefficient to protect jobs. Personally, I blame the system of incentives created by late-stage capitalism. It's more beneficial to litigate your job to a safe place than to learn a new or more efficient method of accomplishing the same job.

ben_w 6y ago
> We have cheap alternatives to heavy metal pipes Wait, are you saying America uses lead pipes, not PVC or copper?
- pksebben 6y ago
  That is precisely what I am saying. It's not everywhere, but there are places (like NY) where it is illegal according to building codes to use pvc. Because any old schmo can work with pvc (although, the law is written as if it's a safety hazard)
jahaja 6y ago
But that would just make it somewhat more expensive to build. The problem is that the supply is always kept insufficient. If, for example, the government would build good quality housing according to need, the housing market would implode. To build according to need was the default in here in Sweden before ~1990.
- pksebben 6y ago
  Making it more expensive translates to a lack of supply - the government has far more limited resources than huge real estate development firms. The pipes thing is just an example. Of course, this is one of a great many factors that make it nigh-impossible to get affordable government housing built. Not the least of which is the actual expense of land vs. cash-strapped local governments (who are broke because our tax system sucks and we spend what little money we do have on subsidies for businesses.) It's a systemic issue - the incentives that we have lead to a governmental inability to function at all levels. Pick any random piece and you can find a reason that it's hard to do meaningful work.
  - jahaja 6y ago
    Sorry but to imagine that labour costs and unions are somehow responsible for the housing shortage is just a strange distraction. We had labour unions in Sweden with good working conditions & benefits etc etc all along that period. The goal to inflate the price of housing is the main issue.
    - pksebben 6y ago
      You're absolutely right - that is the main issue. I'm not suggesting for a moment that fixing labor union litigation would fix housing. It wouldn't. I was using the pipes as an accessible example of what is a single piece of a very, very large mosaic. The assertion I intended to make was precisely this: That it is impossible to point to a single bad actor (although, you are likely correct in pointing out the most egregious of them). The core issue (IMO, the thing to fix) is that the system of incentives that surrounds the developers, contractors, politicians, homeowners, and everyone else involved rewards slicing the pie over making more pie. Adding value, when it's easier to litigate your way into aquiring a larger share of existing value, is pointless from any individual's standpoint. Take a look at the debacle that surrounded the Stuyvesant Town housing projects - this is a case where this sort of pie-slicing quite nearly made it through, but was struck down by the courts. I use this example because due to it's failure the techniques involved are clearly visible: https://www.theatlantic.com/business/archive/2010/01/america-s-most-expensive-real-estate-deal-goes-bust/346884/ https://www.theatlantic.com/business/archive/2010/01/america... ...my central assertion is that the pipes and deals like this are motivated by the same underlying socioeconomic factors. And too many lawyers.

Kalium 6y ago

Do you have a good example of removing the profit/investment motive and the result being enough housing for everyone?

jahaja 6y ago
Yes, Sweden ~1990. There was an agency responsible for adapting housing availability after need. If there was a shortage, it was acted upon. Then the whole homeownership wave, markets etc came.
- Kalium 6y ago
  That's fascinating! Is there anything I could read about this? I would love to hear more about a rich first-world country being able to meet literally everyone's housing needs fully and in a timely manner without using a market economy.
  - jahaja 6y ago
    This is a good start: https://en.m.wikipedia.org/wiki/Million_Programme https://en.m.wikipedia.org/wiki/Million_Programme
    - deleted 6y ago
      [deleted]
    - Kalium 6y ago
      Reading the description there, it seems to rest heavily on profit motives. Perhaps I have missed something? I would love an example of housing for everyone in locations that meets their needs, achieved in a timely manner, in a way that removes profit and investment motives.
      - jahaja 6y ago
        > it seems to rest heavily on profit motives What part are you referring to? > I would love an example of housing for everyone in locations that meets their needs, achieved in a timely manner, in a way that removes profit and investment motives. Well, on the other hand, is there something inherent in housing that requires those motives?

DubiousPusher 6y ago

This is why I focused my point around the cost of the structure. The costs of land (made expensive by policy) and capital (made cheap by policy) are much more complex. But regardless of that, even if you buy cheap land in a low regulation county/state and use all non-union labor, the building cost is still more expensive than it would be if buildings had the reduction of costs that other durable goods have had over time. Some of this is clearly regulatory, i.e. codes. Some is clearly consumer choice, note the failure of prefab and tilt up to catch on. Some is clearly ecology, note the disappearance of native large timber from most residential construction. Many architects and builders have tried their hand at designing homes and construction processes that reduce the costs of buildings but if they have to build to modern codes, expectations and ecological standards they mostly see marginal improvements. There are just a lot of fundamental costs involved with site constructed buildings that meet modern standards.

jahaja 6y ago
Sure, there's additions. But I would be careful to deduce consumer choice from what is most risk-free/profitable, a.k.a. the market. Cheap, decent quality "projects" would also be rented out in no time. But the profit margin and risk assessment isn't in favour of that.