36 ms·
I’m not sure that it’s as simple as that. If you think about the sample metro areas in tfa you see sources of high income potential as corporate headquarters an
by rubyfan 5y ago
I’m not sure that it’s as simple as that. If you think about the sample metro areas in tfa you see sources of high income potential as corporate headquarters and high paying jobs are centered around those metros. That in effect creates high demand for housing and thereby drives up housing prices.
The increase in housing price is probably a derivative of shifting or shrinking opportunity to earn a high income outside of centers of commerce and population growth x scarcity in metros. The rise in home prices is just a premium on income opportunity.
- onlyrealcuzzo 5y agoHigh demand doesn't mean high prices. You can increase supply - but we don't do this. We don't want more supply! Houses are investments. They're supposed to to go up in value! So we limit supply.
- rubyfan 5y agoI agree scarcity is the issue but I think income scarcity is the greater macro driver but made worse by artificial housing scarcity. I think that’s why the divide between housing prices and income is growing. Without income scarcity I don’t believe housing prices would outpace income growth.
- onlyrealcuzzo 5y agoIncome is essentially the medium. I'm having trouble imagining how income is scarce - in the same way money can't really be "scarce" - the value would just adjust. If there's too much demand for money (because there's not enough) - the value goes up. Do you mean income is distributed extremely unequally?