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The only way to make housing more affordable is to increase the supply. That's not necessarily sufficient. From Für eine wirklich soziale Wohnungspolitik[1], c
by cygx 6y ago
The only way to make housing more affordable is to increase the supply.
That's not necessarily sufficient. From Für eine wirklich soziale Wohnungspolitik[1], citing empirical studies of rents in Germany:
Im Ergebnis muss demnach festgestellt werden, dass eine verstärkte Neubautätigkeit unter den gegenwärtigen Bedingungen nicht zu einer Ausweitung von bezahlbaren Wohnungsangeboten führt, sondern vielmehr die Ertragssteigerungen im Bestand beschleunigt.
As a result, it must be stated that increased new building activity under the current conditions does not lead to an expansion of affordable housing offers, but rather accelerates the increase in yields in existing buildings.
The reason for this is that the newly constructed housing tends to be higher priced, and when old housing gets freed, rents tend to get raised on the new tenants.
[1] https://zeitschrift-suburban.de/sys/index.php/suburban/article/download/411/585/ https://zeitschrift-suburban.de/sys/index.php/suburban/artic...
- goodcanadian 6y agoThe reason for this is that the newly constructed housing tends to be higher priced, and when old housing gets freed, rents tend to get raised on the new tenants. If they are able to do this, there still isn't enough supply to meet the demand.
- cygx 6y agoSpace in cities is a limited resource, and it might not even be in the markets interest to build enough housing to let prices drop.
- goodcanadian 6y agoI believe I acknowledged that in my comment, and suggested a possibility of building rapid transit to also increase the effective supply in such cases.
- deleted 6y ago[deleted]
- cygx 6y agoThe accompanying change in demographics (eg driving all but the most well-off families out of the city) might not be deemed acceptable.
- goodcanadian 6y agoSure, but isn't that happening anyway? At least this gives the less well off a reasonable option.
- cygx 6y agoSure, but isn't that happening anyway? Not necessaarily, no. The example of Vienna has already been brought up, where the city outright owns something like 1/4 of of all rented flats, and (as of 2017), about 2/3 of all citizen live in municipal or publicly subsidised housing. There are reason why it's considered one of the most livable cities in the world.
- jabl 6y agoIf you limit "markets interest" to people who already own property in the area, then yes. It's a sort of bad mixture of politics and markets. People who sit on zoning boards tend to own property in the area (or get money and support from such people), and thus it's not in their interest to increase the supply of housing, as that would decrease the value of their investment. OTOH, the people who'd like to move into the area are not represented in the zoning boards. One partial solution is to make zoning a national level decision rather than a municipal, like in Japan: https://urbankchoze.blogspot.com/2014/04/japanese-zoning.html https://urbankchoze.blogspot.com/2014/04/japanese-zoning.htm...