6 ms·

There is no evidence that building more housing has ever reduced housing prices or that it will do so into the future.

Guest42 5y ago
I agree. To me it seems as though a small handful of corporations owns a large percentage of multi-tenant housing and an increasing percentage of single tenant houses and is able to set prices algorithmically and that other landlords price similarly.
- TulliusCicero 5y ago
  A handful of corporation own most of the grocery stores, but grocery prices remain reasonable, nowhere close to as insanely priced as rent. The difference is real competition: there's only so much land that exists, and localities only allow so much housing on that land. Demand goes way up, supply goes up only feebly, the result is predictable.
  - austincheney 5y ago
    Rent is not ownership.
    - TulliusCicero 5y ago
      ...okay?
TulliusCicero 5y ago
This is the opposite of true. The evidence that building more housing decreases prices is overwhelming: https://www.lewis.ucla.edu/research/market-rate-development-impacts/ https://www.lewis.ucla.edu/research/market-rate-development-... > To be clear, this debate is not about whether new housing can reduce housing prices overall. At this point, that idea isn’t really in doubt. There’s good reason to believe that in regions with high housing demand, building more housing can help keep the prices of existing housing down. In their Supply Skepticism paper from 2018, Vicki Been, Ingrid Gould Ellen, and Katherine O’Regan offer an excellent introduction to the broader question of how market-rate development affects affordability. Citing numerous individual studies and reviews of dozens more, they conclude that “the preponderance of the evidence shows that restricting supply increases housing prices and that adding supply would help to make housing more affordable.” Because of course it does. Demand doesn't exist in a vacuum, it's a number judged against supply. If you want to see the real world impact, look at rents where the rules make it easy to build housing. For a city of its size and national importance, Tokyo has dirt cheap rent compared to the states: https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=United+States&country2=Japan&city1=New+York%2C+NY&city2=Tokyo&tracking=getDispatchComparison https://www.numbeo.com/cost-of-living/compare_cities.jsp?cou...
- austincheney 5y ago
  Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. The prices increase directly proportional to the current velocity of new housing availability at any given moment. If they continue to build new housing at this rate my city will become one of the 10 largest US cities within the next 15 years and the value of my house will boom to more than 3x what I paid for it. Why? Fixed assets exist outside the supply/demand cycle of high school economics. You can’t make more land but you can always build more houses irrespective of demand. Aside from conjecture and speculation there is no evidence (data) linking house price reduction (not rent) to new housing availability.
  - TulliusCicero 5y ago
    > Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. Yes, because rules in the US handicap new housing growth. > The prices increase directly proportional to the current velocity of new housing availability at any given moment. Yes, because they have the same cause: demand increasing. Imagine that every car maker was heavily constrained in how many cars they could make. As demands for cars rise, they find every angle to try and produce more cars, but the price keeps going up. Did the new supply cause the price to rise? No, they just have the same cause. There have been myriad studies on this, almost every economist finds that new housing in booming areas makes housing prices less bad than they would be otherwise. > You can’t make more land but you can always build more houses irrespective of demand. This isn't true. Zoning severely handicaps more housing in the places people want to live. Well, except for Houston (sorta), and indeed, rent there seems substantially lower than other major cities in Texas like Dallas and Austin.
    - austincheney 5y ago
      None of that is evidence of houses going down in price.
      - TulliusCicero 5y ago

I agree. To me it seems as though a small handful of corporations owns a large percentage of multi-tenant housing and an increasing percentage of single tenant houses and is able to set prices algorithmically and that other landlords price similarly.

TulliusCicero 5y ago
A handful of corporation own most of the grocery stores, but grocery prices remain reasonable, nowhere close to as insanely priced as rent. The difference is real competition: there's only so much land that exists, and localities only allow so much housing on that land. Demand goes way up, supply goes up only feebly, the result is predictable.
- austincheney 5y ago
  Rent is not ownership.
  - TulliusCicero 5y ago
    ...okay?

TulliusCicero 5y ago

This is the opposite of true. The evidence that building more housing decreases prices is overwhelming: https://www.lewis.ucla.edu/research/market-rate-development-impacts/ https://www.lewis.ucla.edu/research/market-rate-development-... > To be clear, this debate is not about whether new housing can reduce housing prices overall. At this point, that idea isn’t really in doubt. There’s good reason to believe that in regions with high housing demand, building more housing can help keep the prices of existing housing down. In their Supply Skepticism paper from 2018, Vicki Been, Ingrid Gould Ellen, and Katherine O’Regan offer an excellent introduction to the broader question of how market-rate development affects affordability. Citing numerous individual studies and reviews of dozens more, they conclude that “the preponderance of the evidence shows that restricting supply increases housing prices and that adding supply would help to make housing more affordable.” Because of course it does. Demand doesn't exist in a vacuum, it's a number judged against supply. If you want to see the real world impact, look at rents where the rules make it easy to build housing. For a city of its size and national importance, Tokyo has dirt cheap rent compared to the states: https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=United+States&country2=Japan&city1=New+York%2C+NY&city2=Tokyo&tracking=getDispatchComparison https://www.numbeo.com/cost-of-living/compare_cities.jsp?cou...

austincheney 5y ago
Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. The prices increase directly proportional to the current velocity of new housing availability at any given moment. If they continue to build new housing at this rate my city will become one of the 10 largest US cities within the next 15 years and the value of my house will boom to more than 3x what I paid for it. Why? Fixed assets exist outside the supply/demand cycle of high school economics. You can’t make more land but you can always build more houses irrespective of demand. Aside from conjecture and speculation there is no evidence (data) linking house price reduction (not rent) to new housing availability.
- TulliusCicero 5y ago
  > Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. Yes, because rules in the US handicap new housing growth. > The prices increase directly proportional to the current velocity of new housing availability at any given moment. Yes, because they have the same cause: demand increasing. Imagine that every car maker was heavily constrained in how many cars they could make. As demands for cars rise, they find every angle to try and produce more cars, but the price keeps going up. Did the new supply cause the price to rise? No, they just have the same cause. There have been myriad studies on this, almost every economist finds that new housing in booming areas makes housing prices less bad than they would be otherwise. > You can’t make more land but you can always build more houses irrespective of demand. This isn't true. Zoning severely handicaps more housing in the places people want to live. Well, except for Houston (sorta), and indeed, rent there seems substantially lower than other major cities in Texas like Dallas and Austin.
  - austincheney 5y ago
    None of that is evidence of houses going down in price.
    - TulliusCicero 5y ago