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This is reasonable, I guess affordable housing requirements and rent control could be considered a form a redistribution, because they take an already existing

This is reasonable, I guess affordable housing requirements and rent control could be considered a form a redistribution, because they take an already existing supply of housing and force them to be accessible to the poor. Good point. It does sound a bit circular though - if developers are unwilling to build new housing if they're forced to make some of it affordable, why would they ever build any affordable housing at all if left alone by the government? I guess it depends on the details of the specific policy, so maybe too big a discussion for this thread.

NineStarPoint 5y ago
The general the idea is that even if new housing isn't affordable, the existence of more housing overall lowers demand on older housing and therefore lowers prices. If you can encourage enough production of even luxury apartments, this forces the older apartments to lower rent as people capable of paying the old prices move to new locations. If enough houses are built, eventually you drive the price of the lower tiers of housing down far enough for the poor to afford (or at least the government to more easily fund access to.) Unfortunately, this is not a problem that can be solved quickly. The problem took us decades of under building new housing to get to, so it's not surprising it will take us time to get out of it either. One big caveat here is it requires people to actually live in the housing. If real estate is being bought and sat on as a speculation tool (or used as something like an air B&B instead of a rental), it won't actually meet the demand for habitation. As such, some sort of regulation is needed to ensure that housing is actually either lived in or rented out. Second issue is that, of course, NIMBYism is at least as big a threat if not more as price regulation. If things aren't allowed to be built due to local authorization either being impossible or the approval process taking ages to complete, requiring affordable housing be included is the least of your worries. Getting into the many flavors of NIMBY would indeed be too big a topic for this thread, but the overall effect on housing creation is definitely awful. Edit: As a note, there is a massive incentive for those who currently own property to not want housing to be affordable. Lack of supply drives the prices way up, and the people who have seen the worth of their housing double in the last decade don't want prices to go back down to a reasonable level. Since homeowners generally make up a sizeable portion of voters in a given area...it's not too surprising that people constantly vote in ways that make building harder, no matter how hard that makes life for the next generation.
cronix 5y ago
> if they're forced to make some of it affordable How much does government regulation itself play in increasing the price of building a home to begin with? Some estimate 20-25%. Obviously we need some rules, regulations and standards, but I think we're also causing some of this issue and not factoring it in. https://www.constructiondive.com/news/nahb-regulatory-costs-account-for-243-of-new-home-price/418745/ https://www.constructiondive.com/news/nahb-regulatory-costs-... https://www.forbes.com/sites/scottbeyer/2016/09/30/the-verdict-is-in-land-use-regulations-increase-housing-costs/?sh=4623969a4162 https://www.forbes.com/sites/scottbeyer/2016/09/30/the-verdi... https://www.seattletimes.com/business/uw-study-rules-add-200000-to-seattle-house-price/ https://www.seattletimes.com/business/uw-study-rules-add-200...
8note 5y ago
Rent control seems like avoiding redistribution, since people aren't kicked out of their home to make way for someone richer. Neither does it kick a rich person out of their home to give it to a poor person. The distribution of the resource stays with the same people

NineStarPoint 5y ago

The general the idea is that even if new housing isn't affordable, the existence of more housing overall lowers demand on older housing and therefore lowers prices. If you can encourage enough production of even luxury apartments, this forces the older apartments to lower rent as people capable of paying the old prices move to new locations. If enough houses are built, eventually you drive the price of the lower tiers of housing down far enough for the poor to afford (or at least the government to more easily fund access to.) Unfortunately, this is not a problem that can be solved quickly. The problem took us decades of under building new housing to get to, so it's not surprising it will take us time to get out of it either. One big caveat here is it requires people to actually live in the housing. If real estate is being bought and sat on as a speculation tool (or used as something like an air B&B instead of a rental), it won't actually meet the demand for habitation. As such, some sort of regulation is needed to ensure that housing is actually either lived in or rented out. Second issue is that, of course, NIMBYism is at least as big a threat if not more as price regulation. If things aren't allowed to be built due to local authorization either being impossible or the approval process taking ages to complete, requiring affordable housing be included is the least of your worries. Getting into the many flavors of NIMBY would indeed be too big a topic for this thread, but the overall effect on housing creation is definitely awful. Edit: As a note, there is a massive incentive for those who currently own property to not want housing to be affordable. Lack of supply drives the prices way up, and the people who have seen the worth of their housing double in the last decade don't want prices to go back down to a reasonable level. Since homeowners generally make up a sizeable portion of voters in a given area...it's not too surprising that people constantly vote in ways that make building harder, no matter how hard that makes life for the next generation.

cronix 5y ago

> if they're forced to make some of it affordable How much does government regulation itself play in increasing the price of building a home to begin with? Some estimate 20-25%. Obviously we need some rules, regulations and standards, but I think we're also causing some of this issue and not factoring it in. https://www.constructiondive.com/news/nahb-regulatory-costs-account-for-243-of-new-home-price/418745/ https://www.constructiondive.com/news/nahb-regulatory-costs-... https://www.forbes.com/sites/scottbeyer/2016/09/30/the-verdict-is-in-land-use-regulations-increase-housing-costs/?sh=4623969a4162 https://www.forbes.com/sites/scottbeyer/2016/09/30/the-verdi... https://www.seattletimes.com/business/uw-study-rules-add-200000-to-seattle-house-price/ https://www.seattletimes.com/business/uw-study-rules-add-200...

8note 5y ago

Rent control seems like avoiding redistribution, since people aren't kicked out of their home to make way for someone richer. Neither does it kick a rich person out of their home to give it to a poor person. The distribution of the resource stays with the same people